REI’s New CEO Has a Plan to Turn Around the Beloved Retailer—By Going Back to Its Root

For decades, REI has stood apart in American retail. It wasn’t just a store—it was a movement. Founded in 1938 as a cooperative for outdoor enthusiasts, the company built its reputation on authenticity, sustainability, and community. But as the retail landscape changed and economic pressures mounted, REI faced growing challenges: shrinking margins, rising costs, and internal tension between its values and its business realities.

Now, with a new CEO at the helm, REI is embarking on a bold turnaround plan—one that looks less like a reinvention and more like a homecoming. The strategy centers on returning to what made the brand iconic in the first place: a focus on purpose, people, and the outdoors.

A Beloved Brand in a Tough Retail Climate

REI’s challenges mirror the broader struggles of the retail industry. Outdoor gear sales boomed during the pandemic, but post-2022 demand cooled sharply as consumers cut back on discretionary spending. Inflation increased operating costs, leases in prime locations became unsustainable, and online competition intensified.

At the same time, internal morale wavered. Layoffs, the closure of key stores in major cities, and growing tensions with unionized employees left staff questioning the company’s direction. The once-celebrated “co-op culture” was beginning to fray.

The new CEO, Mary Beth Laughton, knows that REI cannot simply cut costs to prosperity. Instead, her strategy hinges on restoring what made REI a trusted and emotionally resonant brand.

Returning to the Co-op Spirit

Laughton’s turnaround plan—known internally as “Back to the Co-op”—focuses on reviving REI’s founding principles: community, sustainability, and shared ownership. Her message is simple but powerful: REI must rediscover the emotional bond between the brand and its members.

That begins with the employees. REI has long referred to its staff as “co-owners,” reflecting its cooperative structure. But years of restructuring left many feeling disconnected from that identity. Laughton’s first priority has been rebuilding internal trust—through better communication, transparent leadership, and a renewed focus on the mission that defines REI: to inspire a life outdoors for everyone.

“Going back to our roots doesn’t mean resisting change,” she has emphasized internally. “It means making sure every decision—every product, every store, every policy—reflects who we are.”

Simplifying the Business to Strengthen the Brand

One of the CEO’s most controversial moves has been a series of store closures, including flagship locations in New York and Boston. While painful, these closures are part of a broader effort to realign REI’s physical presence with its most loyal customer base. The brand plans to focus more heavily on suburban and adventure-centric markets where outdoor participation remains high.

REI is also cutting non-core divisions and streamlining product assortments. Rather than competing head-to-head with mass retailers, the company is reasserting its niche as a premium, purpose-driven outdoor co-op—curating gear, apparel, and experiences that reflect authenticity over scale.

The idea is to shift from “being everywhere” to “being essential” wherever REI shows up.

A Renewed Focus on Sustainability

Sustainability isn’t just a buzzword for REI—it’s a foundational part of its DNA. The company was among the first major retailers to become carbon neutral and continues to prioritize circular commerce through used gear programs and repair services.

Under Laughton’s leadership, REI is doubling down on those initiatives. The brand is expanding its Re/Supply program, which encourages members to trade in gently used equipment. It is also investing in new materials and partnerships to reduce environmental impact across its supply chain.

By strengthening its sustainability credentials, REI is betting on a long-term differentiator: consumers’ growing preference for ethical, environmentally responsible brands.

Rebuilding Employee Trust

After years of organizational strain, rebuilding employee morale is at the core of REI’s new chapter. Laughton’s leadership style emphasizes empathy, communication, and empowerment—qualities designed to reconnect the workforce with the company’s cooperative roots.

She has instituted open town halls, increased listening sessions with store teams, and created new feedback channels for employees at all levels. Additionally, REI plans to invest in staff training, leadership development, and improved benefits to strengthen its culture of inclusion and well-being.

The company understands that its employees are not just retail associates—they are outdoor enthusiasts, storytellers, and the face of the REI community. Their engagement will determine whether the turnaround succeeds.

Building a Modern Outdoor Experience

REI’s future lies in blending its traditional strengths with digital transformation. The CEO’s plan includes expanding the company’s online and mobile presence, using data to personalize shopping experiences while preserving the sense of community that defines REI.

Members can expect enhanced digital tools for trip planning, adventure sharing, and gear rental, turning REI’s digital ecosystem into a hub for outdoor life—not just a marketplace.

The company also plans to reimagine its membership model. New benefits like sustainability credits, early access to local experiences, and exclusive adventure collaborations are being developed to make membership feel more like belonging than a transaction.

Balancing Purpose with Profit

For REI, profitability and purpose are no longer opposing goals—they are interdependent. The CEO’s turnaround plan seeks to demonstrate that focusing on values can strengthen, not weaken, business performance.

By aligning its strategy with its original mission, REI hopes to rebuild brand loyalty, attract younger members who prioritize sustainability, and differentiate itself in a crowded retail landscape.

In a world where consumers increasingly demand authenticity, Laughton’s “back to the roots” approach might be exactly what REI needs to regain momentum and cultural relevance.

The Road Ahead

The path forward won’t be easy. Restructuring always invites skepticism, and the outdoor retail industry remains unpredictable. Yet, REI’s enduring strength lies in its purpose-driven identity—a brand that stands for more than products.

If the company can reconnect its employees, members, and mission, the turnaround could become a case study in how purpose-led business can thrive in turbulent times.

As REI’s new CEO steers the co-op toward its roots, she’s betting that the way forward is not through constant reinvention.