rei - crm improvements (case study)

REISatisfied customers is not the end!

Rob Loranger | Rohit Arora | Krishna Madhuvarsu

REI• Overview• Survey• Membership• Social Media• Google Trends• Mobile• Recommendations

Mission Statement“Our core purpose guides everything we do: we all work to inspire, educate

and outfit for a lifetime of outdoor adventure and stewardship.”

“Each year, REI donates millions of dollars to support conservation efforts nationwide and sends dedicated teams of volunteers to build trails, clean up beaches, restore local habitats and more.... Through responsible business practices across the company, we strive to reduce our environmental footprint.”

REI Overview“help outdoor enthusiasts acquire good quality climbing

gear at reasonable prices”

• Founded in 1938; Privately held; Co-op• selling outdoor recreation gear, sporting goods, and

clothes• 125 retail stores in 31 states, catalogs, and the Internet• 11,000+ employees; 11.6 million members

REI Financial Performance• 2011 sales of $1.80 billion• Operating income was $116.2 million• Net income was $30.2 million• REI welcomed nearly 842,000 new members in 2011.• REI Visa card holders will receive $37.4 million in rebates

from purchases made last year• $99.8 million in patronage refunds will be distributed to 4.7

million active members in March 2012– $21 / customer / year

Best companies to work for: #8*

* Source : Forbes 2012

1970s

• REI Co-Op• serious climbers, backpackers and mountaineering expeditions• Jim Whittaker, the first American to summit Mt Everest, was hired as the first

full-time employee of REI and served as CEO

1980s

• family camping and branched out into kayaking, bicycling, and other outdoor sports

• "sport casual" clothes• REI has diversified its offerings into global adventure vacations though the REI

Adventures branch

REI Formative Decades

http://en.wikipedia.org/wiki/Jim_Whittaker

REI store manager, Concord, CA“help people enjoy out door activities by providing education, a location to purchase the necessary gear, and stewardship opportunities“

• Full price retailer

• REI's goal – offer additional value to the customer by focusing on quality and service – ensure that employees have high product knowledge

• customers to build a high level of trust with REI– Convenient/hassle free shopping experience

• Regions are not necessarily treated differently– regions can choose how to use marketing dollars as they choose– sales, fliers, are decided at the corporate level

• Create customer loyalty via REI membership

Customer Sampling*• Bay Area, California• Age group : 20-45 years• Exposed to high-technology• Total of 76 respondents

* Not meant to represent entire REI customer segments, but provides a sample behavior of customers.

Never

1 time

2 times

3 times

4 times

5 or more times

3.90%

13.00%

20.80%

14.30%

13.00%

35.10%

Frequency of visits to REI (per year)

Yes62%

No25%

NA13%

Do you feel rewarded by REI ?

REI’s Top 5 Competitors1. Sport Authority 2. Sports Basement 3. Amazon 4. The North Face 5. Other Online

10% 3%3%

1%

83%

Social Media relevance to REI

YoutubeFacebookTwitterFlickerAllNot Applicable

64%

27%

9%

How customers access REI ?

Desktop/LaptopSmartphoneTablet

Top 5 attributes of Happy Customer

1. Quality Products 2. Easy Returns 3. Knowledgeable Staff 4. Dividend 5. Sale Deals / Discounts

Other results…• 72% of respondents never attended a

volunteer work with REI• 76% if respondents never attended a outdoor

or travel class by REI• 95% if respondents do not have a REI VISA

card

REI Membership• Benefits

– Annual dividend• Earn a refund of ~10% on eligible purchases• Active REI members receive their refund in the form of an annual dividend

notice.• Only active members receive annual dividend notices

– Discounts– Members only sales– Used gear sales– Board of directors voting privileges – Online community

Data collection • Contact information• Demographic information• Interests • Transaction history• Browser info• IP Address• Pages viewed • Device information• Location info (when possible)

REI Members Only

Social Media Efforts• Facebook

– Guest Posts– Interact with Customers– Share Videos– Photos and Nature Connection– Expert advice videos– Sales and Promotions

• Twitter – Cross posting from Facebook

• Youtube– Member stories– Expert Advice– Travel and Adventures– Featured Products

• Flickr– favorite photos of yourself or other REI members enjoying

the outdoors

Facebook & Twitter Effectiveness• Twitter

1. Walmart (Retweet #3,953 | 99.92 %ile)2. REI (Retweet #23,165 | 99.5 %ile)3. Amazon (Retweet #24,237 | 99.48 %ile)4. TheNorthFace (Retweet #37,771 | 99.19 %ile)5. Sports Authority (Retweet #112,516 | 97.58 %ile)

• Facebook1. Walmart (25,662,763 likes)2. Amazon (14,697,642 likes)3. The North Face (3,015,635 likes)4. Sports Authority (841,204 likes)5. REI (473,557 likes)

Facebook & Mobile

Facebook Engagement Facebook & Mobile Engagement

Sports Authority 6.15% 5.17%

The North Face 1.02% 0.38%

Walmart 2.77% 7.34%

Amazon 2.70% NA

REI 4.20% 14.6%

Google Trends

REI Mobile App (iOS)

Mobile App Comparison

Connecting the dots…

Customer Value

Mobile

Social Media

VISA Card

In-Store

Membership

Internet

Recommendations• Differentiation and customization• All members should not be treated the same

– Differentiate nature lovers and recreational buyers. Target the products based on the preferences.

• MVCs and MGCs should be identified• Create customer profiles from membership data

• Customer example: my recent purchases

Date Purchase Activity

10/14/12 Speedcross 3 Trail-running

7/15/12 Kingdom 6 tent camping

6/1/12 spork backpacking

2/12/12 Alpine Meadows lift tickets ski

Recommendations• REI personalized newsletters– Local classes and events based on customer profile

• Create the awareness using the social media and target the customer using the mobile device

• Educate in-store associates and managers on the mobile, social media and VISA programs

Recommendations• With a deep partnership, provide the VISA card as a

membership card (instead of customers applying for the VISA separately)

• Provide more point based sale links on the emails, Facebook and Twitter. Help customer to purchase immediately.

• Provide web based catalog customization based on the customer’s purchase habits. One catalog does not fit all.

Thank You

rei - crm improvements (case study)

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