REI Case Study

Every day is better when you #OptOutside

For the past three years, REI (Recreational Equipment, Inc.) has skipped the Black Friday frenzy by closing their stores and giving employees the day off with pay.  Millions of people have joined them outside.  On REI’s website, they have included this link with pictures of outdoors submitted by customers under various hashtags - #getoutside, #utah, #pnw, etc. with the caption “#OptOutside is all about you.”  “Let’s get outside every day.  Join us.”  With the earned media attention they received for closing on Black Friday, REI keeps the adventure going.

REI is an outdoor sporting goods company founded in 1938 by a group of 23 Pacific Northwest mountain climbing buddies who wanted better ice axes.  It is now the nation’s largest consumer cooperative, meaning it is a company owned by its members.  Each eligible member is entitled to vote in the election of the Company’s Board of Directors.  Members receive dividends - approx. 10% off non-sale items, plus member-only discounts twice a year.  In 2016, the number of eligible voting members was 6.3 million.  They have 154 retail stores and sell online at rei.com.

REI’s value proposition is a life outdoors is a life well lived.  Quality outdoor gear and clothing - 100% satisfaction guarantee - and a cooperative that puts people first.  They gave 70% of profits to the outdoor community by funding grants for non-profit organizations to make the outdoors accessible to all.  Members, employees and customers volunteer together to build outdoor trails, restore local habitats, and clean up beaches.  Their core purpose guides everything they do:  “We all work to inspire, educate and outfit for a lifetime of outdoor adventure and stewardship.”

Advertising expense for 2016 and 2015 was $71.6 million and $72.6 million, respectively.  Interesting to see they spent $1 million less in 2016 than 2015.  Could it be because of their #OptOutside campaign?  In 2016, revenues grew 5.5 percent on 2015 to $2.56 billion.  REI invested $9.3 million in nonprofits (including one-time REI Foundation grants) and in 2016 gave back $193.7 million in dividends and credit card rebates to members.  They have been on FORTUNE magazine’s list of the “100 Best Companies to Work For” every year for the past 20 years.  

I think their marketing is strong with the continued use of social media and sweepstakes and have no recommendations to the marketing team.  Their website includes their blog with stories of life outdoors in addition to #OptOutside.  They are true to their mission and show consistently that they care about people.  Even their job descriptions begin with undeniable positivity “What’s cool about this job” and end with “Why you’ll love it here.”

Week 2 Social Listening & Marketing in the News

Topic 1:  Social Listening

I selected The Container Store with its value proposition of a happy, organized life; Life is better when you're organized. The Container Store sells storage solutions, shelving, and organizers for every room in your home. The challenge is to come up with new products to attract new consumers and give prior consumers a reason to return. I personally have organized all my closets with their help and have no more closets to do. Bringing in new products regularly keeps me coming back.

One theme of the comments on Instagram is that people love the products and want them even though they don't need them.

The second theme is that they want The Container Store to open one where they live.

 

The third theme is love for their wrapping paper and decorations in December.

As brand manager, I would let my team know that we are doing well at making our customers want our products. I would let customers know about new store openings, that we ship to where they are, and that we will give their suggestion on new store locations to our team. I would second the love of the December decorations.

Topic 2:  Marketing in the News 

Diet Coke has launched 4 new flavors of zero calorie drinks aimed at millennials in North America. Diet Coke dominates the diet soda category (26.3 percent dollar market share), but its sales have decreased in recent years as customers have chosen sparkling water or zero-calorie energy drinks instead.  The new flavors Ginger Lime, Feisty Cherry, Zesty Blood Orange and Twisted Mango were a result of a two-year process based on consumer research that showed younger Americans have an affinity for big, great-tasting flavors in their beverages.  More than 30 flavor combinations were tested.  

The challenge of this campaign is for Coke to reach their target audience, millennials, without alienating their loyal Diet Coke fan base, primarily women.  These new flavors will be packaged in "sleek" 12 oz cans, the same shape and size as DASANI.  The marketing campaign by Anomaly features the tagline "because I can."  Ads will start later this month and will feature actors like Karan Soni from "Deadpool" instead of A-list pop stars as in the past.  The new marketing campaign will be more gender neutral and diverse.  The article doesn't say where the ads will appear.  Since their goal is to reach millennials, I hope they will spend more time using social media to create interest in their product rather than the traditional methods of TV and print ads.

Diet Coke's value proposition is a thirst-quenching beverage with zero calories that's been around for 36 years.  The regular Diet Coke is unchanged.  This new Diet Coke will change flavors, but will still use aspartame, the sweetener that some feel are linked to health issues.  (When Diet Pepsi removed aspartame in 2015, consumers complained and sales dropped).  It is unclear from the article if Coke's focus groups addressed this issue.  It will be interesting to see what millennials think about the use of this sweetener in their beverage.  

BA 223 Topic 1 and 2

Week 1 Topic 1: About Me

I enrolled in this course to learn to market myself for jobs and to potentially teach business courses at high school.  I have taken a year off from teaching high school math to explore what I want to do as my career for the next 10 years.  I started LBCC last term by taking one accounting course.  I have degrees in statistics and am not interested in a degree, but I am taking accounting technology courses.

I know very little about marketing.  I want to learn how to best market my talents for prospective employers.  I want to learn more about social media.

I am passionate about my children.  We recently became empty-nesters, so I am looking for new hobbies or rediscover old ones.  I enjoy watching live musical theater.  Animated films are a favorite of mine as two of my 3 children are video game artists.  I plan to return to tap dancing after a 4 year hiatus.  I like to swim for exercise.

Week 1 Topic 2: Marketing in the News

"Peeing on this ad may change your life," is the caption at the top of the ad that shows an IKEA crib.  In IKEA’s latest magazine ad campaign in Sweden, the ad has a built-in strip similar to a pregnancy test that pregnant women can pee on and take to the Ikea store to receive a discount on an IKEA crib.  This ad supports IKEA’s value proposition of doing it a different way to create a better everyday life for people, but I’d hate to be the clerk who has to accept the “coupon” for purchasing the crib!  Even though this ad is only in Sweden in the Amelia magazine, it is remarkable as it is being talked about worldwide.

IKEA is a worldwide retailer of ready-to-assemble furniture and home furnishings, founded in 1943 by Ingvar Kamprad in Sweden.  IKEA’s vision is to create a better everyday life for many people.  They offer home furnishings with good design and function at low prices so that as many people as possible will be able to afford them.  

This crib ad is consistent with IKEA’s marketing campaign called “Where Life Happens,” created by Åkestam Holst in Stockholm.  The campaign uses emotional storytelling to show IKEA as part of our everyday lives that include divorce, adoption, raising teenagers, etc.  It was interesting to watch the videos associated with this marketing campaign.  I was surprised to learn that divorce is a taboo for advertisers which is surprising to me since 40-50% of U.S. married couples divorce (American Psychological Association, apa.org).  Upon reflection, I realize that I haven’t seen ads that show divorce.  After divorce, children live in two homes.  In this ad, the father has duplicated his son’s bedroom using the same IKEA products used in his former spouse’s home.  Having been through divorce, I found this ad to be authentic in helping a child transition to this new living situation.