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REI Marketing Environment Worksheet
List the current characteristics of each environmental factor as they relate to REI.

U.S. Economy
How does the current U.S. economy affect REI retail operations?

The U.S. spent the years 2007 – 2009 in a period of serious recession. This caused consumers to seek out lower prices for the goods and services they need and caused a significant decrease in spending for anything other than necessity items (Charles W. Lamb, 2013). Since REI is in a broad sense in the entertainment industry, spending for the type of items REI sells would have been reduced. Yet, it seems that, according to the outdoor industry association, that more than 140 million Americans place outdoor recreation in a position of high priority in their lives. Therefore, though they may search competitors to find the best prices, Americans have not significantly lowered the amount they are spending on outdoor recreation (Outdoor Industry Association, n.d.). So it seems the current economic conditions are forcing REI to face losing sales to competition and not simply losing sales to lack of spending due to economic conditions.

Global Economy
How does the current global economy affect REI retail operations?

The global economy, which had shown signs of recovery, has weakened (Wessel, 2012). Therefore, any market REI had outside of the U.S. will be reduced. This can have a dual effect. Any competitors that REI in terms of U.S. exports will be suffering the same reduced market. That may force some competitors out of that export market, giving REI a greater share of the market. If competitors are not forced out, however, REI will face the same competition for a reduced market.

An additional challenge for REI is that “almost every country in the world is trying to increase its exports at the same time” (Wessel, 2012), which could effectively increase competition within U.S. market for REI products.

Legal and Regulatory Environment
What types of legal and regulatory forces affect REI in the U.S.?

With REI sales comes the possibility of collecting private and personal information on its customers. In doing this, REI must comply with a legal responsibility to properly secure or dispose of this information (Bureau of Consumer Protection, n.d.). REI’s website details its privacy policy and how personal/private information can or will be used and gives consumers an opportunity to opt-out of receiving emails and having information used by third-parties (REI, n.d.).

As a business covered under the Fair Labor Standards Act, REI has the responsibility of ensuring appropriate wages, overtime, and time off for its employees (United States Department of Labor, n.d.). REI takes its compliance with this regulation further by ensuring its manufacturers, whether domestic or international, are also compliant with this regulation (REI, n.d.).

Socio-Cultural Forces
What types of social and culture trends affect REI?

The trend toward “green” products and activities can be a major social/cultural trend affecting REI. “Consumers want to act green, but they expect businesses to lead the way” (Sheila Bonini, 2008). It seems that REI is already trying to lead the way with green products like their lines of eco-conscious gear and initiatives such as the ability to add on “carbon-neutral options” to their vacation packages (Matthew Feldman, 2007). Green products need to overcome five barriers to increase consumer sales: lack of awareness, negative perceptions, distrust, high prices, low availability (Sheila Bonini, 2008). REI appears to be ready, willing, and able to overcome these barriers from the appearance of their website and their 100% satisfaction guarantee.

REI is also answering the social/cultural trend toward a work/family balance with their employee challenge grant, time off, discount, work/life employee assistance, adoption assistance, gym/fitness discounts, flexible schedule, and sabbatical programs (REI, n.d.). The target market for REI products is also the targeted employee, it appears from the website, and the offered benefits appeal to the need for work/life balance.

Technological Forces
What type of technology changes affect REI?

REI takes full advantage of internet technology and social media through its website. The website advertises all the products available for sale; gives its customers access to discounts, gifts cards, financing options, and membership; and prominently displays its 100% satisfaction guarantee. The ability to connect to the store through facebook, twitter, youtube and other social media as well as mobile phone applications is displayed in an eye-catching spot to enhance convenience (REI, n.d.).

The REI website also provides learning opportunities to its customers through its REI outdoor school. This section lists events, expert advice, a blog, and two modes of outdoor school: in person and by web videos (REI, n.d.). All these options make it very convenient for a consumer to learn new modes of outdoor recreation and provides the opportunity for new sales by bringing customers into new forms of outdoor recreation.

Competitive forces are also a part of the marketing environment, and we will review those in this unit’s second assignment.
Works Cited
Bureau of Consumer Protection. (n.d.). Privacy and Security. Retrieved from Federal Trade Commission: http://business.ftc.gov/privacy-and-security

Lamb, C. W. (2013). MKTG 6. Mason: South-Western.

Matthew Feldman, M. J. (2007). Looking Down From the Top of the Mountain. Retrieved from McAfee.cc: http://www.mcafee.cc/Classes/BEM106/Papers/2007/REI.pdf

Outdoor Industry Association. (n.d.). The Outdoor Recreation Economy. Retrieved from USDA: http://www.fs.usda.gov/Internet/FSE_DOCUMENTS/stelprdb5389204.pdf

REI. (n.d.). Fair Labor and Factory Compliance. Retrieved from REI: http://www.rei.com/stewardship/workplace.html

REI. (n.d.). Privacy Policy. Retrieved from REI: http://www.rei.com/help/privacy-policy.html

REI. (n.d.). REI. Retrieved from REI.com: http://www.rei.com/

REI. (n.d.). REI Jobs/Benefits. Retrieved from REI.com: http://www.rei.com/jobs/pay-benefits.html

Sheila Bonini, J. O. (2008). Cultivating the Green Consumer. Retrieved from Stanford Social Innovation Review: http://www.ssireview.org/articles/entry/cultivating_the_green_consumer

United States Department of Labor. (n.d.). Handy Reference Guide to the Fair Labor Standards Act. Retrieved from United States Department of Labor: http://www.dol.gov/whd/regs/compliance/hrg.htm

Wessel, D. (2012, August 20). How Will Gloomy World Economy Affect U.S. Exports. (D. Greene, Interviewer)

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