REI sells a lifestyle. The loss-leader hypothesis feels right. If I had to guess I'd say they make more money from style than gear. And so much of the gear they sell is of low quality, probably dating back to the decision to change the return window from lifetime guarantee to one year. They are not good stewards of the ecosystems from which they profit, and I do hold them to a higher standard. These glamping trips are also antithetical to LNT ethos.
🤔I wonder if their finances are slipping in this economy. Although hiking camping isn't the most expensive hobby it's still a luxury unless you're going dirtbag.
That's true. Many of the employees I spoke with said the "adventures" (which were third party) sold very well. The day trips (which REI ran) did not. I wonder if REI was trying to consolidate so that it could take on more of the profit margins of these experiences... and then just realized for some reason that wouldn't be possible.
A few more employees have reached out to me, and if I can convince one of them to go on the record, there may be an interesting follow up to all this...
I am a little shocked REI was losing money in Experiences. Every time I priced one I was shocked at how expensive it was vs DIY, or even contacting a local guide directly.
I talked to a fellow Tour du Mont Blanc hiker several years ago who went through REI for the hike planning. I don’t recall the exact numbers but I think it was $2-2.5k more than what I paying - I did all my own booking and logistics. I know he had daily luggage transfer and probably some additional handholding, but that’s *a lot* of money. Someone was either taking a big profit on that, or else there was a lot of non-value-add labor being done. I think REI should have been able to at least break even on this business unit of they’d bothered to try.
REI sold a culture and endorsed a lifestyle. It was an entry-level outdoor promoter, not high-end like some of the others. Sad for those who rely on the camps for guidance as they enter the outdoor culture. Even worse for the guides who partnered with REI in good faith… not a good look for REI.
Also sucks for organizations like the BSA (or scouting America, who knows what they call themselves these days) that used REI sponsored classes to get certified for trips.
I've been on several REI Adventures and just had a 7 day Grand Canyon trip cancelled for this year. If someone had reached out about transferring the trip to another outfitter I would've jumped on it (it involved a stay at Phanton Ranch which can't be secured easily). I'm very disappointed and truly sad for all the guides. My last trip had guides who worked directly for REI. Thanks for the reporting.
I don't see an option to PM... but no. REI didn't send any information other than the initial cancellation email and then a refund. I figured maybe the trip was run by REI and not contracted.
Great article Cole! I’ve been an REI Co-op member since 1991 and, while the quality of REI gear still earns high marks, the direction of the company seems to have changed several years ago. I’m curious to see if there was a change in company leadership that coincides with this shift away from expanding the outdoor community to just selling high-end gear to outdoor posers. Thanks for highlighting REI’s unfortunate decision to eliminate their Experiences program. Maybe I’ll switch to a company like Nemo who is still heavily invested in the true outdoor community.
It's not even high-end gear at REI. The best marketplace for excellent hiking and backpacking stuff is Garage Grown Gear. May GGG and REI last forever.
Thank you for reading! Another reader suggested that the retail side of things has also slumped so dramatically, the co-op needs to reduce its footprint.
Experiences may have been worth subsidizing in the long term. But short term, they might not have been able to justify it. I think this will hurt their future long-term, but I suppose only time will tell.
Rei's 40 years Experience is a huge marketing investment.and it is very diffcult to track whether the participants contribute to future sales. With nowadays, it is very easy for prospects to purchase gears on Amazon or other E shops,instead of being retained by REI.
I am managing an outdoor brand in China,and most of the brands or retailers is trying to grab the sales,too few companies can afford for educating outdoor lifestyle.
This makes sense. I think REI also lost a bit of its appearance of quality; a few commenters have pointed out that the co-op stopped stocking some really good brands. If it feels like you can get the same gear at Walmart, why not just go and get it for Walmart prices?
Oh man this is such a bummer - thanks for the reporting! I live in the LA area and I’ve noticed the stores definitely pivoting more toward every day lifestyle clothing stores than outdoor activity gear. Makes sense, I guess, and aligns with this switch. I’ve taken a class at the store and done two half day kayak trips and really enjoyed both and they had great guides. Sad to see that stuff leave.
Interesting to hear the experience of someone who's taken an experience, as I personally haven't. There was one I'd been eyeing for a while... guess I'll have to find a local tour company on my own.
My husband also did a short backpacking trip w his mom bc a coworker highly recommended it and he said it was truly really great and the guides were amazing.
So maybe the CEO is right and only .4% of customers participated in experiences. But it's so easy to lie with statistics. If that percentage rises amongst returning customers or if experiences generates new customers, then this could be a loss for REI. That said, you must also ask how many Boomer and elder Gen X folks are aging out of REI purchases or not introducing Gen Z to the hobby.
Ah, see… he didn’t say customers. He said co-op members. That’s already misleading, IMO because I don’t know if REI ever clears its membership numbers. They could be counting a ton of “co-op members” who aren’t paying customers anymore. They may have moved on to different retailers, or even died.
I think your point about gen z is salient: most people learn about the outdoors from their family. Having fewer experiences in the outdoors will undoubtedly make younger generations care about it less.
Hi! Thanks for your interest. It took me a little bit of time to figure out the best way to sort and present all of this information. I also wanted to give readers a little time to submit.
I hope this message finds you well. We wanted to reach out to share an important update regarding REI’s Experience Program. As many have already heard, REI has announced its decision to discontinue this program. We understand that this news may have left many customers feeling uncertain about their future travel plans and experiences.
In response to this development, Colorado Mountain Expeditions has stepped forward to offer a special discount to clients who were part of the REI Experience Program. We are committed to providing exceptional outdoor adventures and want to ensure that everyone has the opportunity to continue exploring the great outdoors.
Join CME for a unique hiking experience with our guided slack-packing trips! Our expert guides will lead you through some of the most stunning landscapes of Colorado, Arizona, and Utah allowing you to immerse yourself in nature while we take care of your gear, food, water, and transportation. We also, offer backpacking in Rocky Mountain National Park and climbing in Penitente Canyon.
For more information about the discount we are offering and the various experiences available, please feel free to contact us at info@ColoradoMountainExpeditions.com. We encourage former REI Experience Program members to take advantage of this opportunity.
Thank you for your attention to this matter, and we look forward to continuing to serve the outdoor community.
REI sells a lifestyle. The loss-leader hypothesis feels right. If I had to guess I'd say they make more money from style than gear. And so much of the gear they sell is of low quality, probably dating back to the decision to change the return window from lifetime guarantee to one year. They are not good stewards of the ecosystems from which they profit, and I do hold them to a higher standard. These glamping trips are also antithetical to LNT ethos.
What perplexes me, even after all this, is what changed? Why now? If it's always been a loss leader, why now is the loss intolerable?
And yeah, the Signature camps seemed like a weird thing for the Co-op to hang its hat on.
Thanks for reading!
🤔I wonder if their finances are slipping in this economy. Although hiking camping isn't the most expensive hobby it's still a luxury unless you're going dirtbag.
That's true. Many of the employees I spoke with said the "adventures" (which were third party) sold very well. The day trips (which REI ran) did not. I wonder if REI was trying to consolidate so that it could take on more of the profit margins of these experiences... and then just realized for some reason that wouldn't be possible.
A few more employees have reached out to me, and if I can convince one of them to go on the record, there may be an interesting follow up to all this...
I look forward to reading it.
I am a little shocked REI was losing money in Experiences. Every time I priced one I was shocked at how expensive it was vs DIY, or even contacting a local guide directly.
It’s pretty expensive, yeah. I got the impression when speaking with REI employees that it was more for their big-spender customers.
I talked to a fellow Tour du Mont Blanc hiker several years ago who went through REI for the hike planning. I don’t recall the exact numbers but I think it was $2-2.5k more than what I paying - I did all my own booking and logistics. I know he had daily luggage transfer and probably some additional handholding, but that’s *a lot* of money. Someone was either taking a big profit on that, or else there was a lot of non-value-add labor being done. I think REI should have been able to at least break even on this business unit of they’d bothered to try.
An extra 2.5k is a whole lot, I hope your fellow hiker got white glove service for that much 😅
REI sold a culture and endorsed a lifestyle. It was an entry-level outdoor promoter, not high-end like some of the others. Sad for those who rely on the camps for guidance as they enter the outdoor culture. Even worse for the guides who partnered with REI in good faith… not a good look for REI.
Also sucks for organizations like the BSA (or scouting America, who knows what they call themselves these days) that used REI sponsored classes to get certified for trips.
Thanks for reading!
I've been on several REI Adventures and just had a 7 day Grand Canyon trip cancelled for this year. If someone had reached out about transferring the trip to another outfitter I would've jumped on it (it involved a stay at Phanton Ranch which can't be secured easily). I'm very disappointed and truly sad for all the guides. My last trip had guides who worked directly for REI. Thanks for the reporting.
Did REI message you with information to get in touch with the subcontractor?
I’ve been in contact with quite a few of these companies. PM me if you like, I might be able to get you in touch with the local guide
I don't see an option to PM... but no. REI didn't send any information other than the initial cancellation email and then a refund. I figured maybe the trip was run by REI and not contracted.
Great article Cole! I’ve been an REI Co-op member since 1991 and, while the quality of REI gear still earns high marks, the direction of the company seems to have changed several years ago. I’m curious to see if there was a change in company leadership that coincides with this shift away from expanding the outdoor community to just selling high-end gear to outdoor posers. Thanks for highlighting REI’s unfortunate decision to eliminate their Experiences program. Maybe I’ll switch to a company like Nemo who is still heavily invested in the true outdoor community.
It's not even high-end gear at REI. The best marketplace for excellent hiking and backpacking stuff is Garage Grown Gear. May GGG and REI last forever.
You're the second person to mention GGG, and I'd never heard of them. I'll have to check them out now
Thank you for reading! Another reader suggested that the retail side of things has also slumped so dramatically, the co-op needs to reduce its footprint.
Experiences may have been worth subsidizing in the long term. But short term, they might not have been able to justify it. I think this will hurt their future long-term, but I suppose only time will tell.
Rei's 40 years Experience is a huge marketing investment.and it is very diffcult to track whether the participants contribute to future sales. With nowadays, it is very easy for prospects to purchase gears on Amazon or other E shops,instead of being retained by REI.
I am managing an outdoor brand in China,and most of the brands or retailers is trying to grab the sales,too few companies can afford for educating outdoor lifestyle.
This makes sense. I think REI also lost a bit of its appearance of quality; a few commenters have pointed out that the co-op stopped stocking some really good brands. If it feels like you can get the same gear at Walmart, why not just go and get it for Walmart prices?
Oh man this is such a bummer - thanks for the reporting! I live in the LA area and I’ve noticed the stores definitely pivoting more toward every day lifestyle clothing stores than outdoor activity gear. Makes sense, I guess, and aligns with this switch. I’ve taken a class at the store and done two half day kayak trips and really enjoyed both and they had great guides. Sad to see that stuff leave.
Interesting to hear the experience of someone who's taken an experience, as I personally haven't. There was one I'd been eyeing for a while... guess I'll have to find a local tour company on my own.
Thanks for reading!
My husband also did a short backpacking trip w his mom bc a coworker highly recommended it and he said it was truly really great and the guides were amazing.
So maybe the CEO is right and only .4% of customers participated in experiences. But it's so easy to lie with statistics. If that percentage rises amongst returning customers or if experiences generates new customers, then this could be a loss for REI. That said, you must also ask how many Boomer and elder Gen X folks are aging out of REI purchases or not introducing Gen Z to the hobby.
Ah, see… he didn’t say customers. He said co-op members. That’s already misleading, IMO because I don’t know if REI ever clears its membership numbers. They could be counting a ton of “co-op members” who aren’t paying customers anymore. They may have moved on to different retailers, or even died.
I think your point about gen z is salient: most people learn about the outdoors from their family. Having fewer experiences in the outdoors will undoubtedly make younger generations care about it less.
Hello there - have you published the Guide Service directory? I only see the input form and would love to see the result.
Thank you 🙏
Hi! Thanks for your interest. It took me a little bit of time to figure out the best way to sort and present all of this information. I also wanted to give readers a little time to submit.
Version 1.0 is slated for publication Thursday!
Awesome, thank you
I have never heard of REI. Now that I have, it sounds like it would be fun.
Why can't another group take over the day trips and scheduling? Or is REI the only company that can do it?
Other groups can, it’s just that all the guide companies will very quickly need to scramble to re-book their trips, and get in contact with customers.
I’m putting together a directory of all the companies… should be coming out next week!
Great take. Thanks for this detailed reporting.
Thanks for reading! I hope to have the guide index V1 done within the week. Hopefully some of these outfitters can reunite with customers
Wow! Nice work. Love seeing how others are working to help these important small businesses regroup and recover.
I hope this message finds you well. We wanted to reach out to share an important update regarding REI’s Experience Program. As many have already heard, REI has announced its decision to discontinue this program. We understand that this news may have left many customers feeling uncertain about their future travel plans and experiences.
In response to this development, Colorado Mountain Expeditions has stepped forward to offer a special discount to clients who were part of the REI Experience Program. We are committed to providing exceptional outdoor adventures and want to ensure that everyone has the opportunity to continue exploring the great outdoors.
Join CME for a unique hiking experience with our guided slack-packing trips! Our expert guides will lead you through some of the most stunning landscapes of Colorado, Arizona, and Utah allowing you to immerse yourself in nature while we take care of your gear, food, water, and transportation. We also, offer backpacking in Rocky Mountain National Park and climbing in Penitente Canyon.
For more information about the discount we are offering and the various experiences available, please feel free to contact us at info@ColoradoMountainExpeditions.com. We encourage former REI Experience Program members to take advantage of this opportunity.
Thank you for your attention to this matter, and we look forward to continuing to serve the outdoor community.
It's good that Plakanis responded to you. Her company never responded to questions I emailed them directly from their website last summer.
Also, it's Pisgah National Forest, not Pisa.
I'm an REI member and I had never heard of Experiences. They could have marketed it better.