Last month, outdoor outfitter REI sent shock waves through the retail world when the company announced it will close all of its 143 stores on one of the biggest shopping days of the year – Black Friday. The post-Thanksgiving shopping spree is one of REI’s top 10 sales days of the year. But this November 27th, the member-owned co-op will endure short-term pain for what could turn out to be long-term gain.
The decision to opt out of Black Friday was made earlier this year. According to Ben Steele, REI’s chief creative officer, “We came together as a group and asked ourselves what we wanted to do this holiday season and as we looked around at what Black Friday was and what it had become, we knew what we didn’t want to do – we felt it had gotten out of hand."
For those of you worried about REI workers losing a day of wages, don’t fret! The company has it covered. They will be paying employees and encouraging them to spend the day in nature. Taking it a step further, REI has launched a micro-site for its #OptOutside campaign and there are currently over 900,000 people (and counting!) who have made a public commitment to opt for the great outdoors rather than spend the day battling long lines at the mall. (Sounds like a great way to walk off the Thanksgiving turkey and mashed potatoes!)
When I first read the news, my jaw dropped and I got chills. I experienced what psychologist Jonathan Haidt calls “moral elevation”, which he describes it as a warm uplifting feeling that people experience when they witness unexpected acts of human goodness, courage, or compassion. Haidt argues that we are wired to be inspired and that these feelings are contagious. They motivate others to do good themselves. In other words, REI has activated a powerful force: the warm and fuzzies. Those of you rolling your eyes right now will want to read on.
Kickstarting a virtuous cycle
Since the announcement there have been many to follow REI’s lead and join the #OptOutside movement. Outdoor Research, a Seattle-based retailer, plans to close its corporate offices, distribution center, local factory and retail store. The company is using the opportunity to raise money for the organization Paradox Sports, a nonprofit that helps people with disabilities explore the outdoors. For each 100 submissions of photos to #OptOutside, the company will donate $1000 to Paradox Sports, up to $5,000. Other companies that have decided to close on that day include Clif Bar, Giro, Baltimore’s Joe’s Bike Shop, Ohio’s True Heights Equipment Outfitters, and Washington’s Bicycle Adventures.
To support the cause and make it easier for people to opt outside, California and Minnesota state parks announced earlier this month that their collective 125 state parks will be open and free of charge to the public on Black Friday. This was made possible in part by an anonymous $50,000 private donation to the Save the Redwoods League. On the east coast, The Trustees of Reservations, the largest conservation organization in Massachusetts, will waive entrance and parking fees at 144 of its properties.
All of this all has me thinking: is REI onto something big here? Does #OptOutside have the potential to drive Black Friday to extinction? Not likely. But will this be a game changer for the future of the shopping Super Bowl and could it prompt other brands to start thinking differently? Absolutely.
REI has its finger on the pulse
REI’s decision has been heralded by many as “brilliant”, “unprecedented”, “perfect”, “courageous”. Others have taken the conspiracy theory stance, speculating that the reverse psychology of telling people not to shop coupled with the creation of a scarcity mentality will actually bring in more shoppers. This isn’t exactly a new idea. In a similar campaign launched by Patagonia in 2011, the company placed a full-page ad in the New York Times with an image of their best-selling jacket along with the message, “Don’t buy this jacket.” Bloomberg reported that in the following two years, annual sales grew by nearly 40%.
The cynic within me suspects REI is only doing this to boost profits. The optimist in me wants to believe that REI truly cares about the wellbeing of its customers and employees. Whatever the case, here’s hoping this inspires other companies to bring their higher values more clearly into focus.
It’s not as if the move is completely out of step with who REI is as a company. #OptOutside aligns perfectly with REI’s brand and its mission to “inspire, educate, and outfit for a lifetime of outdoor adventure and stewardship.” In terms of social and environmental responsibility, the company has a long history of treating employees well and caring for the environment. Since 1998, REI has consistently ranked among Fortune magazine’s “100 Best Companies to Work For”. When it comes to environmental stewardship, REI has ambitious goals to achieve carbon neutrality and become a zero waste-to-landfill company by 2010.
So why aren’t more companies like REI? For one, REI is a co-op or cooperative. Co-ops are owned by members, not shareholders, so they are able to think in longer time horizons than most publicly traded companies. According to Erbin Crowell, executive director for the Neighboring Food Co-op Association, “That basic structure frees up the business to do things that don't really make sense in conventional market terms.”
To understand this a little better, we turn to one of the most influential economists in history, Milton Friedman. In his book Capitalism and Freedom published in 1962, Friedman argued that private companies have no "social responsibility" to the public because its only concern is to maximize profits for itself and its shareholders. Friedman writes:
"There is one and only one social responsibility of business – to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game."
While this may be true, it flies in the face of recent consumer trends that show 87% of consumers in the United States believe companies should value the interests of society at least as much as strict business interests.
REI sees what’s coming down the pike. It knows that the feel-good-purchasing-phenomenon is only going to continue to grow. Because of this, companies that want to thrive in the future will have to give a damn about people and the environment. Not solely because it is their “social responsibility”, but because the rules of the game have fundamentally changed.
Happy Thanksgiving! Please also read our related holiday articles:
Buy Nothing! That’s Right, Nothing!
Small Business Saturday: The business case for local holiday shopping