Gap's Athleta became a billion dollar brand last year. As the Gap and Banana Republic brands shrink, Athleta is expanding. This fall, Athleta will open its first two international stores in Canada – arch rival Lululemon's hometown. A core part of Gap's strategy is to double Athleta's sales by the year 2023, and it needs new markets to accomplish that. Canada is both a new market and a test market. And though Lululemon is a powerful force to be reckoned with, Athleta CEO Mary Beth Laughton thinks there is space – and demand – for more than one popular athleisure brand.
“We’ve obviously taken a look at the market and just feel like there is an appetite for new brands,” Laughton tells Fortune.