In the 2011 film Crazy Stupid Love, there is a scene where Steve Carrell’s and Ryan Gosling’s characters, Cal and Jacob, are shopping for jeans for Cal. They’re in a high-end denim boutique, and Cal thinks that he doesn’t need new jeans, that the pair he is wearing is fine. After Jacob tells Cal he has a mom butt in his jeans, Cal wonders aloud, “Why can’t we just go to the Gap?”

And like most American shoppers, Jacob looks up and rolls his eyes before walking out of the store. Once Cal catches up to him, Jacob grips his face with both hands and tells him “Cal, be better than the Gap.”

Be better than the Gap. Ouch.

The Golden Era of Minimal Cool

Gap, the namesake subsidiary of Gap, Inc. (GPS Quick QuoteGPS - Free Report) , used to be cool. It was so cool that actress Sharon Stone wore a classic Gap white buttoned shirt with a lilac Vera Wang skirt to the 1998 Oscars. It was a brand that was quintessentially American, boosting the popularity of simple staple wardrobe pieces like t-shirts and khakis.

In the 1990s, the retailer hired merchandising star Mickey Drexler as CEO, and under his leadership, Gap rose meteorically to become an iconic part of the decade’s pop culture. Back then, Gap held great power over American fashion. It not only followed trends, but also set them. Gap was the epitome of effortless chic.

Drexler shattered the myth that good taste had to be expensive. He gave the masses a way to look good and fashionable without going broke, and in the process, he both changed the way the world dressed and built Gap into a $14.5 billion behemoth.

Despite his retail finesse, as well as game changing advertising campaigns—think “Individuals of Style” and “Who Wore Khakis,” each starring cultural icons—Drexler was eventually fired due to a series of bad business calls. Increased competition from imitators like Abercrombie & Fitch (ANF Quick QuoteANF - Free Report) made Gap steer away from its well-known basics to cropped t-shirts, low-rise pants, and brighter colors, all in a disastrous effort to stand out.

Killer Promotions

The new decade saw Gap lose, or really, forget, its core brand identity, an identity in which it forged a retail empire. The company lost itself in the changing times and the struggling economy, and it failed to keep up with a market dominated by millennials. Instead of appealing to this new and incredibly influential consumer, Gap focused on its original Generation X customer base.

Their product, however, appealed to neither.

The number of retail choices shoppers have to choose from have increased exponentially over the past years, crowding the market enough that consumers began to look past Gap for their wardrobe basics, spending their money at popular fast-fashion chains like H&M, Zara, and Uniqlo where the product has good quality at a good price.

Which, funnily enough, is what made Gap so special back in the ‘90s.

As a result, Gap, as well as its other subsidiaries Banana Republic and Old Navy, have resorted to heavy promotions to get customers back in its stores. Eye-catching signs promoting 30%, 40%, or even 50% off your purchase dominate store windows and entrances on a daily basis.

Promotions can be useful tools for retailers. They are a relatively easy way to draw consumers into their stores in order to get rid of inventory or products that don’t sell well at full price. But Gap took promotions to an extreme level, and ultimately killed what was left of its brand.

With its constant discounting, the company taught its customers to never buy anything at full price. Because if you wait just one more day to buy that blouse or pair of jeans, there will most likely be some promotion online or in-store discounting those items.

This, more than anything, crushed Gap.

The Shaky Future of Gap

With this backdrop, Gap’s first quarter fiscal 2016 financial results were unsurprisingly disappointing. And like its rivals, Gap's sales have been getting slammed by decreasing foot traffic. During Q1, global Gap sales fell 3%, Banana Republic sales dropped 11%, and Old Navy sales were down 6%.

So what can Gap do differently?

Answered bluntly, literally everything. Gap is in a rut. They rely too much on promotions. Their product feels dated, boring even. They’ve become basic, but can’t figure out how to market the basic clothing items that made them famous. For Gap to win over and grow its consumer base again, it needs to dig deep into what once made its brand successful, but also keep in mind that times and retail strategies have changed.

More and more, fashion is turning digital, and connecting with technology is crucial for Gap going forward. The mobile experience needs to be a core focus for the company. Current CEO Art Peck knows this will be challenging, as Gap is much farther behind than many of its competitors. The retailer should take advantage of mobile-based apps like Instagram and Snapchat in order to promote their products, and even Amazon, which Peck says the company would consider utilizing to reach customers.

It’s imperative for Gap to connect with Millennials and even Generation Z, which are much different shoppers than those in Generation X. The retailer used to thrive because it understood who their core audience was. Gap can appeal to Millennial and Generation Z shoppers by not only increasing their social media presence, but also revamping its mobile app, building a “Buy Online, Pick-up In-store” option, and creating a loyalty program instead of pushing its store credit card.

Perhaps Gap is going through some growing pains. It’s heyday in the 1990s was the time of its carefree, buoyant youth. Now—actually, for the past 15 years or so—is Gap’s awkward, sometimes hard-to-watch teenage years, riddled with braces, acne, and a crippling case of self-doubt. If there was hope for any of us during our young adulthood, then there is certainly hope for Gap.

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