• by Sarah Mahoney  @mahoney_sarah, February 2, 2011

Gap Inc. has named Seth Farbman -- currently a managing director at Ogilvy & Mather -- as its new CMO, and hired Ogilvy & Mather Worldwide as its new ad agency.

And Pam Wallack, currently president of its Gap Adult North America team, has been named head of something called Gap's new "Global Creative Center." That unit will be based in New York, and Farbman will report to her.

In its announcement, the San Francisco-based company was candid that the brand has been a disappointment. "I expect more from our Gap business in North America," said Glenn Murphy, chairman/CEO, in the release. "The changes we're making are intended to propel the brand to deliver the product and brand experiences our customers demand worldwide."

The moves are part of sweeping changes at Gap Inc.'s floundering flagship, which the company hopes will "kick-start" a new marketing direction. It ditched Marka Hansen, who has been president of Gap North America, naming Art Peck, a six-year company veteran, to fill the post.

Hansen may be best remembered for one of the most visible marketing gaffes of the decade, which happened last fall. Just four days after unveiling a new logo, the company yanked it, with this apology from Hansen: "We did not go about this in the right way. We recognize that we missed the opportunity to engage with the online community. This wasn't the right project at the right time for crowd sourcing."

But Gap's problems are much bigger: Comparable store sales have been declining steadily for the last six years, and despite a few good months this year, fell 8% in December. The company is scheduled to report January sales tomorrow, and fourth-quarter results later this month.

Farbman has developed marketing campaigns for consumer brands such as Coca-Cola, UPS, Unilever and Time Warner Cable, and founded OgilvyEarth, O&M's sustainability practice.

Gap is also merging its Outlet division with the Gap and Banana Republic brands.