Retailers follow REI’s lead for Black Friday shutdown

Jerry Stritzke’s desk is a hand-hewn slab of wood, cut near his second home in Colorado. His commute at least once a week is by bike, and last summer he summited Mount Rainier in Washington state with a team of employees in tow. As the president and CEO of REI, he seems to fit the stereotype associated with the outdoor supplies retailer. Lately, he’s been getting a lot of attention for sticking to the company’s mission: “To inspire, educate and outfit for a lifetime of outdoor adventures and stewardship”.

On Black Friday, the day after Thanksgiving that’s considered one of the biggest shopping days of the year, all REI stores will be closed. It’s part of a campaign called #OptOutside, and REI’s employees will have that day off with pay.

The campaign quickly sparked a trend: numerous other companies – such as Joe’s Bike Shop in Baltimore – said they would do the same, and state parks started offering free admission for that day. But when Stritzke held a Reddit Ask Me Anything (AMA) session shortly after REI’s announcement, several disgruntled employees took over the online chat to voice their dissatisfaction with the company’s sales and employee benefit programs.

Stirtzke became the company’s seventh CEO in August 2013 after Sally Jewell left that April to become the US Secretary of the Interior. Before coming to REI, Stirtzke had been the president and chief operating officer of Coach Inc. He’d been at Coach since 2008, and had nearly doubled sales from $2.6bn to $5.1bn.

Given his luxury good background, Stritzke initially seemed an unlikely leader for REI, especially on the boot heels of Jewell, who has a long history in the outdoor and conservation worlds. But Stritzke says he chased the opportunity: “I actually called REI when I heard that Sally was moving on because I have been a lifelong lover of the outdoors and wanted to work here for years.”

Jewell, who worked in banking before coming to REI, nearly doubled annual sales in her eight years there, from $1bn in 2005 to $1.9bn in 2012. Stritzke is working on growing the company further, branching out of the coastal cities where its stores are popular. “We now strongly believe we need the retail expertise, and we’re seeing that value from him already,” REI Chairman John Hamlin told the Seattle Times.

REI operates in an uncommon space. It’s a retail entity that’s closely associated with a dedication to the outdoors, and the company is set up as a member-owned cooperative, or co-op, so it has more latitude to look at nonfinancial goals. REI – which has 5.5 million members who buy into the membership program for $20 a pop – calls itself the nation’s largest consumer co-op. In 2015, the company has given $8m to nonprofits and other groups that provide outdoor access. But it’s also a business that has to make money.

In Stritzke’s tenure, REI has been opening stores in places like Columbus, Ohio, and Des Moines, Iowa. It’s trying to toe the line between digital and in-person sales – and is not alone in trying to broaden its strategy. Even Amazon, which Stritzke says is one of REI’s biggest competitors, is experimenting with brick and mortar locations; it just opened a book shop in Seattle, on the other side of Lake Washington from REI.

But Stritzke says his real strength is brand building – it’s what made him successful at Coach, and he sees it as a big opportunity for REI. That’s where the seed for #OptOutside came from. “We started looking at Black Friday nine months ago and wanted to do something that was more aligned with our co-op heritage and values,” he says.

Stritzke says the Reddit experience, which turned into an airing of grievances from former employees who took issue with the company’s focus on pushing memberships and the ways employees were rewarded, was another – albeit brutal – way to hone that brand. “What surprised me after the Reddit AMA was that the aspects of the conversation that actually became more heated were elevated hours after we had left the forum, which much of the press omitted,” he says. “I was encouraged that once we had the opportunity [to] respond to the elevated questions, we actually had a positive response to our commitment to have a substantive conversation.”

He says it’s important to him to keep the dialogue open, and that being present online promotes conversation and lets him stay on top of what’s culturally relevant.

In addition to #OptOutside, REI is finding other ways to engage its members and potential members digitally. Earlier this year, it launched an online stewardship program called Every Trail Connects, in which members could decide where the co-op would put its philanthropic dollars. According to Stritzke, 100,000 people participated in the first two days.

This sort of engagement is Stritzke’s idea of success, and goes a long way to explain why a quick profit fix during Black Friday isn’t a priority for the company. “We measure business health with a view on the long range rather than the short term,” he says. “We really just need to ensure that we have enough profit to pay our 10% dividend to members each year, to make good on our commitments to profit sharing across the co-op, have enough cash flow that the co-op can be a vibrant and compelling retailer, and to keep investing in nonprofits.”