REI Names Former Sephora Exec as Marketing Boss to Revitalize the Outdoors Stalwart

[Pivo]

In April, REI reported a net loss of $311 million for 2023, which it ascribed partly to raises for hourly employees and its dividend for co-op members. Sales decreased 2.4% to $3.76 billion from 2022, when it reported a loss of $164.7 million.

https://www.wsj.com/articles/rei-names- ... _permalink

[Jim]

Did the other thread get locked?

Jacobs, who will lead REI’s 225-person marketing team remotely from San Francisco, will be responsible for REI’s entire marketing effort, including brand strategy, advertising and its customer-retention strategy.

225 people to market things at a Co-Op? Maybe REI ought to get back to basics and sell things to people that want to buy at a fair price so they can use them outdoors, and not be a brand retailer that caters to brand people? I liked the REI for people who do things, not the REI for status seekers.

I know nothing of the other companies this woman worked at, but maybe luxury brands is not what REI needs? They all sound like retailers an outdoorsy man (or woman) would never shop at, unless they shop at REI to see and be seen. Almost sounds like they might be doubling down on what got them to the place the are, regardless of any political or ideological bent.

[Pivo]

Did the other thread get locked?

I couldn't find it.

[TooOld2Hike_EP]

In April, REI reported a net loss of $311 million for 2023, which it ascribed partly to raises for hourly employees and its dividend for co-op members. Sales decreased 2.4% to $3.76 billion from 2022, when it reported a loss of $164.7 million.

Without going into politics or ideology, while I'm not surprised that there was a net loss in this economy, I am surprised that it had sales of $3.76 billion in this economy.

The metric that I use for inflation is the price of Geyser Spring water at the grocery store. It jumped from $1 to $1.70 immediately after Biden took office and only now is occasionally on sale for $1.50. The cost of the water at the spring didn't change. So that leaves everything else.

I have heard that backpackers are a crazy lot. I guess it must be true if they're willing spend so much money on equipment.

[chumley]

I am surprised that it had sales of $3.76 billion in this economy.

Driven nearly exclusively by seasoned citizens buying pricey high-margin ebikes.

[Alston_Neal]

Without going into politics ...... immediately after Biden took office..

[overthehillsfaraway]

I was getting REI gift cards from family members for bday/holidays for a few years but now I've almost run out of anything reasonable to buy. Stopped over before a recent backpacking trip to check out a few items and everything was 5-10x what I wanted to spend. Fiddled with it, set it down, and left with my gift card balances intact. They don't even carry shoes in my size anymore. Fortunately there's a sort of generic "Sportsman's warehouse" or something like that right next to REI, has some better options.

[xsproutx]

@Alston_Neal
I'm sure said poster will post evidence of such a ridiculous claim. I am certain. No way someone would lie about such a thing or let there own clearly non-biased opinions shape their memory. I know in my personal discussions with the SVPs and EVPs of Kroger that they were really just sitting there and went, "AHA! Biden is in office, let's get even more greedy!"
Spoiler alert. That didn't actually happen. Their suppliers did a cash grab. Surely a corporation would never take advantage of a global disruption. Surely. A disruption and price increase that, empirically, started under the previous administration with an increase that was similar (but less) than the rest of the western world before slowing and performing better than the rest of the world. Was Biden in charge of Germany...? France...? Australia...? UK...?
I'm amazed at how people with a lot of lived life experience try and simplify things so much. Yes, things are more expensive than when REI started out. It's been a few decases. Yes, part of that is typical corporate greed. Crazy idea, a lot was also due to a global disruption that led to increases globally and 'murica performed better than it's peers in the same time period. If a product is 5-10x of what you were expecting to spend, then you probably weren't in the market anyway for anything of quality. To be fair, I have stupid wide feet and most places don't carry things for my dumbass feet and I have to order online which sucks, but is what it is.

[overthehillsfaraway]

@xsproutx
I dunno man I stopped over there and asked about a bear bag and REI rep told me the one they had was 200+ dollars. It's a bag and a rope, how much quality do ya need? So I got one off Amazon for 19 bucks instead Similarly got a puffy blanket for 70 off Amazon, REI's were all heavier and at least 50% costlier. I feel like their selection is limited to specific pricey brands, and they present the co-op brand as the cheaper alternative. Since they don't carry shoes in my size I have to go to the local shoe store for trail shoes too.

[xsproutx]

@overthehillsfaraway
No disrespect intended, but that's a user/buyer problem. If you're talking something to do a bear hang with, they sell stuff for 10-20 bucks all day long. I mean, this is a big "brand" bag as people here say and you can get a 20l for 28 bucks (and 20l of food is... a lot of food.) https://www.rei.com/product/218049/ospr ... t-dry-sack

Now, if you said "bear bag" they probably thought you meant a bear proof bag like an ursack, which you can get for 110 bucks (half of what you said...). So even with that, the story doesn't add up. 19 bucks off amazon will be similar to a dry/wet osprey bag, not an ursack, so roughly the same price. For the puffy blanket, you say it's heavier and more expensive... well, that generally means warmer. Without more details I can't really expand more. Could be that you're just comparing apples to pineapples based on weight/warmth/price/etc. Beats me. But yes, you're correct: the store brand is presented at the more budget friendly alternative that gets you 90% of what some bigger brands get you for 60% of the price. The same way I'm good with the store brand for black beans but I gotta get that name brand for aluminum foil because it's worth the price difference on same things but not always.

If you don't know what you want or the right questions to ask, that's mostly on you. I would hope the employee might ask you clarifying questions but some employees interests might be kayaking or rock climbing or paying their rent vs backpacking and there is no reasonable way you can expect someone making a small wage to know everything about every outdoor activity.

[Jim]

I'll take any unused REI gift cards. My Altras are nice and all, but they just don't last.

I still can't get over REI having a 225 person marketing department! WTF do they even do? I'm an REI member, why are we paying for these people to do whatever it is they do, there. Are the TPS reports really that important?

Unless that team is a lot of student interns or really poorly paid (doubtful), that department costs REI members over $22 million per year. I think REI doesn't need a new marketing head, they need an entirely new C-suite and they need to cut out the bloat, the fat, the waste, and the upper level staff who pat themselves on the back and contribute little of value in the way of real product or service to REI members. Replace them with an AI. I'm sure Chat GPT can market as well as an over paid Ivy League Luxury consumer. I don't mind obvious mistakes if the shoes are all discounted and the back packs on sale all the time.

[LindaAnn]

I can think of a lot of reasons REI is struggling financially...

Across retail as a whole, brick and mortar stores have been in a decline for years, and REI is no exception. I think getting foot traffic into any store is an uphill battle for a lot of retailers.

Pricing. REI is often more expensive than their competitors. In a quick look online a few minutes ago--a MSR Hubba Hubba 2p tent is $299 on amazon. It is on the REI website on "sale" for $385. A 15l Ursack is $115 from Walmart, and $125 from REI. Those are pretty big differences in literally the first two items I looked up.

REI had a nice bump in the early days of covid, when lots of people were recreating outdoors vs indoor activities. Obviously that waned. Some people lost interest and went back to their old hobbies. Other people continued with their outdoor activities, but still have the original gear they bought a few years ago. Most gear for casual users can last for many years before needing to be replaced.

A lot of the more avid outdoor enthusiasts shop at their preferred retailers besides REI, or only use REI as a backup option. There is nothing REI sells that I can't get elsewhere for probably a better price.

Inflation/economy. At a time when a lot of people are just struggling to buy food at the grocery store, recreational purchases get postponed, or are purchased cheaper elsewhere.

Left leaning corporate stance. Like it or not, REI's corporate messaging leans pretty far left. They devote a lot of retail space to brands that also turn off a lot of shoppers. That alone discourages about half of their potential or former customer base. That nonsense a few years ago about not selling Camelbak because they fell under an umbrella of companies that sell firearms and ammo??? Yeah, things like that cost them customers. That's when I stopped shopping there. In the years since that happened, I used my last remaining dividend on a pair of Tevas, which REI had to replace twice. And last Christmas, I bought one of my former stepsons a few pairs of Darn Tough socks because apparently that's what all the Army Rangers prefer and my daughter wanted to buy some for her brother, and it was late on Christmas Eve, and REI is close to my house. I went from spending thousands of dollars a year at REI to less than $100 in more than six years.

Rude employees. Many years ago, I took a girlfriend into the old location in Tempe to buy a pair of hiking shoes. The guy helping us was rude from the start, then started losing his mind at the pair of socks she was wearing to try on the shoes. Started yelling at her that she needed wool socks. Dude, she is just trying on shoes wearing a pair of athletic crew socks, I'm pretty sure she'll be fine. She got mad, found the pair of shoes she liked, ordered them on amazon directly in front of the guy, and handed the shoes back to him.

[xsproutx]

I still can't get over REI having a 225 person marketing department!

Yeh, that part is a bit odd for the size of the company and the number of stores/employees/etc for sure. For context, Walmart has roughly 1700 marketing employees for 10,500 stores that employ a lot more people and carry a lot more SKUs (REI has a 190 stores or so).

Sometimes orgs will put "product managers" under the marketing umbrella even though they aren't marketing in the traditional sense of the word, perhaps that is what's going on here a bit but it does make you raise your eyebrow a little. You mention a c-suite change and I'm pretty sure most of that HAS turned over in the last couple of years. They lost 4 in an 8 week period a year or two ago

[trekkin_gecko]

i still buy shoes there when i can get 20-30% off
rei doesn't carry much ultralight backpacking gear
my last few big ticket items have been from cottage companies
rarely need any gear these days
when they moved from southern and priest to 56th and ray, it is no longer convenient to shop there

[chumley]

Make outdoor shopping great again.
February 2006. RIP Popular.

[LosDosSloFolks]

@chumley
I remember shopping at the original store in Glendale. Also the Yellow Front Store on Thomas. Great stuff!

[CannondaleKid]

Also the Yellow Front Store on Thomas. Great stuff!

I lived a few blocks away from that store the first few years after I moved to AZ so I bought all my outdoor gear there.

[rwstorm]

Let's not forget Yate's Army/Navy Surplus back in the day.

[LosDosSloFolks]

@rwstorm
I remembered incorrectly... Yates was the one on Thomas I referred to earlier. Yellow Front was on Indian School. The mind is the first thing to go.

[rwstorm]

The mind is the first thing to go.

As if that really matters.