By Rick Aristotle Munarriz (TMF Edible)
March 29, 2000

Bears, there's a place for us. Somewhere. The dreadful West Side Story ads have done little to ease my concerns. It's definitely a more alienating campaign than past all-encompassing efforts. That is not good. As a matter of fact, I feel a medley coming on...

"Tonight, Tonight, I'll short this stock tonight. Tonight there will be no mourning scars."

"Bacteria, I just met a fate named Stockholderia."

And, while Barbara's clan sings "I like to be in America," let me take this opportunity to tackle my worthy Fool's points.

"Long-term stock market value correlates very highly with brand recognition."
Not really. If we take a look at the list, we find Gap at 29. Nice. But let's look at some of the names that ranked higher. Shares of Gillete <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: G)") else Response.Write("(NYSE: G)") end if %>, Nike <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: NKE)") else Response.Write("(NYSE: NKE)") end if %>, and Philip Morris <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: MO)") else Response.Write("(NYSE: MO)") end if %> are fetching half of what they did during last year's highs. Kodak <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: EK)") else Response.Write("(NYSE: EK)") end if %> and Coke <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: KO)") else Response.Write("(NYSE: KO)") end if %> aren't faring much better.

You see, it's not the rank, it's the momentum behind the rank. After all, fellow retailers Sears <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: S)") else Response.Write("(NYSE: S)") end if %> and K-Mart <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: KM)") else Response.Write("(NYSE: KM)") end if %> once probably ranked high and we know how they ended up.

"As the trend toward more casual clothing in the workplace becomes the norm, Gap stands to be a huge beneficiary."
Maybe it's just me, but wider acceptance of casual wear at the workplace will result in more self-expression -- not a reliance on Gap's overpriced, cookie-cutter basics.

But, even if that is not the case, it's a mistake to assume that the trend toward casual days will always include Gap at all. Retail = fickle. It's like saying America's growing consumption of red meat spells good things for Planet Hollywood's celeburgers. Does anyone remember when Merry-Go-Round and the Edison Brothers chains ruled the 1980s mall scene? Both chains filed for bankruptcy in the 1990s. Gap had a great run, but was Sears unstoppable? I'm not saying Gap is about to buckle under, but as a long-term investor shouldn't one be concerned that history has shown a consistent changing of the guards at the retailer helm.

"My bulls-eyes brighten as I contemplate the benefits of international expansion."
Benefits? With no concern of the heightened risks? For starters, save for James Dean Levi's or Jerry Lewis fake teeth, fashion has been more of an import than an export. Domestic juggernauts like Wal-Mart <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: WMT)") else Response.Write("(NYSE: WMT)") end if %> and Toys "R" Us <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TOY)") else Response.Write("(NYSE: TOY)") end if %> haven't had a cakewalk overseas. Cultural adaptation and country-specific marketing are no easy feats to master.

"Gap's marketing is so prevalent that it has been credited with starting or encouraging many of the recent fashion trends."
Aerosmith has been putting out hits as long as the Gap has, but does that mean I want to buy in? Dream on, Fools. That Sears catalog used to nail it every year way back when. There is a big difference between buying a one-product company (like, say, Coke) and buying a company whose very survival depends on perpetual reinvention. The whole Chrissie Hynde debacle has me wondering if the right side of Gap's brain is wrong. The Dread Side Story campaign has me wondering if the left has, in fact, left.

"Gap has the bullish edge on the Internet."
The convenience of Gap's online return policy means that the company has to tack local sales tax onto every order. Today, the online shopper is more interested in finding deals, not the convenience of the act itself. So I'll bank on the chances of Bluefly.com with its free shipping and tax-free status (in 48 states) over Gap. A bricks-and-mortar presence has proven to be a liability in the online world. Is it mere coincidence that pure online storefronts like Amazon.com <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: AMZN)") else Response.Write("(Nasdaq: AMZN)") end if %>, CDNow <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CDNW)") else Response.Write("(Nasdaq: CDNW)") end if %>, and eToys <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ETYS)") else Response.Write("(Nasdaq: ETYS)") end if %> lead their niches?

Sorry, Officer Krupke, Gap shares just don't arrest me.

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