Old Navy enters a new category with the launch of its lingerie collection.
Old Navy says underwear was the most wanted merchandise on the Old Navy website that the company wasn’t already selling.
Priced at $ 4.99 to $ 24.99, the collection includes bras, bralettes, and underwear.
Old Navy is part of Gap Inc.’s GPS,
Gap, which is undergoing a turnaround, is set to benefit from a rise in spending on clothing after a year in which sales of clothing and accessories suffered from COVID-19, analysts said.
See: Gap ready for clothing comeback after COVID, sells Janie and Jack kids’ line
Old Navy has been the premier brand in the Gap line, with Athleta growing and the namesake and Banana Republic facing challenges.
Old Navy appears to be extremely well positioned to gain market share this year, Athleta has significant lead for continued growth and the Gap brand is showing greenshoots in its brand health initiatives, Wells Fargo analysts wrote in a report. March note after meeting with Gap executives.
Wells Fargo believes Gap’s stock is overweight with a price target of $ 40.
Gap stock has risen 52.2% in the past three months and has climbed almost 432% in the past year.
The benchmark S&P 500 SPX,
is up almost 64% in the past 12 months.
Women’s underwear is a crowded category, with a number of top brands including Victorias Secret, Aerie from American Eagle Outfitters Inc. AEO,
and digital native brands like Thirdlove and Rihannas Savage x Fenty.
L Brands Inc.s LB,
The Victorias Secret brand is also undergoing a commercial overhaul in order to keep up with changing trends. The company recently raised its forecast for the second time in weeks, with stimulus funds and other factors leading to what L Brands called unusual changes in consumer spending habits.
Also: Victorias Secret’s parent lifts forecast again, analysts believe stock could rise further
Women’s underwear, a category that increasingly includes items such as sports bras, loungewear, and shaping items like Spanx or Kim Kardashian Skims items, is turned into a $ 19.6 billion industry. It is expected to grow at a compound annual growth rate (CAGR) of 4.3% from 2020 to 2025, according to data provided by Coresight Research.
Since the category of women’s underwear is quite comprehensive, retailers may want to explore the options for men.
NPD data shows that men’s underwear sales rose 2% in the second half of 2020, while men’s clothing fell 12%. Boxers were up 64% and boxers 16%.
As we’ve seen in many clothing categories, consumers have focused on clothing that prioritizes comfort, and men’s underwear sales are no exception, said Kristen Classi-Zummo, director of apparel market information at the NPD Group, in a statement.