Dive Brief:

• Gap Inc. CEO Glenn Murphy will step down as chief executive and chairman Feb. 1 after seven years leading the company, the retailer said Wednesday.

• Art Peck, Gap’s digital chief, will replace him as CEO. Bob Fisher, son of the retailer’s founders, will be non-executive chairman.

• Murphy became CEO in 2007 and is credited with turning the company around after faltering sales that were made worse by the economic downturn. Under his watch, the retailer improved its merchandise mix, acquired activewear brand Athleta and luxury brand Intermix, and expanded overseas.

Dive Insight:

Wall Street frowned at this news yesterday and sent Gap Inc.’s shares down, a sign of how well respected Glenn Murphy is and perhaps of how little known is his successor-to-be.

Indeed, although the retailer is still struggling to roar back, Murphy helped breathe new life back into the brand at an especially iffy economic time. For one, he brought on Athleta, which is now a key player in the fiercely hot activewear market. But Art Peck’s digital expertise will be key as web and mobile commerce become increasingly important, both separately and as part of a retailer’s brick-and-mortar strategy.