Deborah Baic/Globe and Mail/Canadian Press In the 40-plus years since Mountain Equipment Co-op (MEC) was founded, it has forged a reputation as an environmentally conscious supplier of outdoor and mountaineering equipment. But in an effort to keep up with changing tastes and expand its appeal, MEC recently completed the biggest inventory expansion in its history—and it did so without alienating its core customer base.
MEC got its start in 1971, when a group of six University of British Columbia students who were outdoor enthusiasts scraped together $65 to start a co-op to import and sell climbing and hiking gear. Today, MEC has three million members and 15 stores in six provinces, with annual sales of $269 million. But a year-over-year gross revenue tumble in 2010—the first since 2003—got management's attention.
"What we've really opened our eyes to in the past two years is that membership is changing," says Jeff Crook, vice-president of buying and design. "The way people want to spend their free time recreating is diversifying." While MEC members might be campers and kayakers on their backcountry vacations, most live and work in cities—where they do things like cycle, jog and do yoga. If that is where MEC's customers are going, explains Crook, it is incumbent upon the co-op to follow. Although some "tried and true" members have pushed back against the co-op's expansion into new product lines, says Crook, "Those are some of the areas that are growing the fastest for us right now."
MEC is responding to its changing member base, which needs yoga tops as well as outdoor gear
To keep those tried-and-true members happy, MEC leverages the credibility it has spent years building up. "We have one foot on the factory floor and one foot in the campground," says Crook. That means hiring people who are passionate about outdoor activities. That way, says Crook, "I get someone who can look at 10 new pieces of equipment and tell you which one matters most to climbers. And he knows why." Even as the store brings in urban-recreation gear, says Crook "We're adamant that we will still be the best technical provider of equipment in Canada."
MEC also stays connected to its hardcore, outdoor-enthusiast customer base by delivering a "one foot in the campground" in-store experience. Climbing walls, exposed wood and stone, and huge images of pristine wilderness evoke adventures in the wild rather than running in the suburbs. And while MEC stores are large, says Bruce Smith, a retail-design expert at Toronto-based consultancy dmd Ltd., they're built with energy-efficient features such as green roofs and composting toilets that reinforce the co-op's image as an environmentally conscientious brand "and bring authenticity to the store."
As for the yoga tops, they're tucked in right next to the backpacks and sleeping bags. The message is clear: this expansion is about "adapting to members' changing needs," says Crook. If customers trust MEC to provide them with tents and kayaks, the thinking goes, those same customers are likely to return when they are looking for running shoes. "For most of our existing members, they like to be able to buy all their recreational-product needs at MEC," explains Crook.
In that, the co-op is only staying true to its original mandate. All the founding members wanted, says Crook, was "access to really good products so they could continue going out to their adventures."
Read the rest of the retail report for more winning strategies.
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