So the saying goes, "When one door closes, another door opens."
Gap is hoping that's the case as it looks to build the Athleta brand, with a little help from its growing Athleta Girl line. And this goal is a key piece of the growth strategy that investors cheered Wednesday, pushing the stock to close nearly 8 percent higher.
Lululemon earlier this year announced it would be pulling the plug on its standalone Ivivva stores and is expected to close all of those doors by the end of the third quarter. Ivivva, launched in 2009, is Lululemon's line designed exclusively for younger girls.
Lululemon's closest competitor in the market for children's athleisure could be considered Gap's Athleta Girl.
With Lululemon scaling back and offering Ivivva primarily online, it may come as a surprise that Gap is not only doubling down on Athleta — calling the brand one of its two "growth brands," with Old Navy — but is expanding its line for girls. Beginning this fall, all Athleta stores will feature Athleta Girl, which was previously only on display in select locations.
"We're responding to customer demand for our Athleta Girl business ... and will now have an expression of the girl collection in every store this fall, just as our competition is closing all of their girl stores," Gap CEO Arthur Peck said on a recent call with analysts and investors.
Athleta is a "great brand" with "terrific runway," Peck added.
On Wednesday, Gap announced that it expects net sales at Athleta to exceed $1 billion during the next few years. To build on this, Gap is planning to open more Athleta stores over the next three years.