NEW YORK (CNNMoney.com) - No. 1 apparel seller Gap Inc. on Tuesday announced that all of its namesakes U.S. stores are getting a substantial makeover this July and the retailer will also relaunch its TV ads in a bid to win back customers and revitalize its sagging sales.

Cynthia Harriss, president of Gap (Research) U.S., addressing a gathering of investors and analysts at the annual Piper Jaffray Consumer conference in New York, said the new store setups, which will debut on July 20, are based on a "shop within the store" concept whereby merchandise will be arranged into four distinct sections or "shops," each representing a specific product category supported by its own in-store advertising.

The "denim shop" will sell jeans, denim skirts, trousers, vests and jackets. The "T-shirt" shop will feature all styles in one area of the store. The "clean shop" will feature more sophisticated urban upscale clothing such as cashmere sweaters, jackets, trousers while the "hoodies shop" will showcase a collection of fleece activewear clothing such as sweatshirts and casual cargo pants.

"These are the four categories that we are absolutely committed to and what we stand for," Harriss said adding that the idea behind the strategy was to "keep it simple" and make it easier for people to shop and find products in the store.

Moreover, the merchandise in each section will be continuously updated rather than refreshed only seasonally, Harriss said.

Gap will also reinstate its TV ads beginning mid-July. "Our fall marketing will be a comprehensive campaign to create buzz and generate traffic," Harriss said. Gap surprised many industry experts last holiday season by announcing it would not support the brand with any TV commercials during the one of the most critical shopping periods of the year.

Marketing experts subsequently chastised the retailer, calling the move a marketing "blooper" for a company known for its iconic TV ads which often cast celebrities such as Madonna and Sarah Jessica Parker. The new ads, however, will use models and individual "stylemakers" rather than celebrities.

Harriss acknowledged that these moves are an effort by the company to get things back on track. Sales at Gap stores open at least a year - a key retail measure known as same-store sales - have declined for 17 out of the past 19 months as the retailer struggles to correct its merchandise mistakes.

"We've been in a bind for a couple of months and we've been selling more at markdowns. We're not very pleased with our numbers but we think we're starting to get some momentum," she said.

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