Cover Story: REI Treks Ahead

Needless to say, the co-op memberships help drive incremental sales. REI paid out $105 million to members last year, and “a lot of those dividends come back to us,” Bowcut says, in the form of new product purchases.

Still, REI has gone to great lengths to determine who its best customers are, in frequency and monetary value, and in which channels they prefer to shop. The company got to this point because of two growing trends: the rising cost of printing and mailing catalogs, and the mounting environmental movement.