Outdoor Insight

s /UTDOOR )NSIGHT s *ULY outdoorinsightmag.com O utdoor vendors have a love-hate relationship with the Internet. On the one hand e-commerce is an avenue to a virtually unlimited audience. On the other, the Internet remains the Wild West of retailing — price discounting and customer service top the list of concerns for companies looking to establish and develop a brand strategy. Enter Gear Coop. Brand and price integrity are the foundation on which this eight-year-old California company is built. With 95 percent of its business derived from its e-commerce channel, it has succeeded in a relatively short time to carve a reputa- tion that makes it a favorite among the major outdoor brands. Today, Gear Coop is the leader in representing outdoor brands in the Amazon channel. It got that way by focusing relentlessly on brand integrity. "Companies like The North Face, Arc'teryx, Black Diamond, Smartwool and many more, trust our expertise in driving sales and marketing in the Amazon channel, while maintaining their brand integrity with ... full-price compliance," explains founder and owner Terry Lee. "Our vendor brands also value partnering with a true outdoor specialty retailer, one who shares many of the same values." Lee founded The Coop, as its customers affectionately refer to it (its formal name is Gear Co-Op) in 2009 in a tiny shack in Costa Mesa, CA. Even back then it had a three-tiered strategy that remains in place today — a small brick-and-mortar store, its own gearcoop.com and the Amazon channel. In 2011, it moved to its current store at the SoCo Center, where it builds its own brand locally by hosting numerous events. In 2016, Gear Coop joined the Grassroots Outdoor Alliance. With a merchandise mix of 35 percent apparel, 15 per- cent footwear, 35 percent gear and 15 percent accessories, Gear Coop's customer base trends on the younger side, primarily Millennials and Gen Xers. Its roots are in climb- ing, so it has a core audience of climbers, plus skiers and general outdoor enthusiasts. While its store does serve as the nerve center of the business, it is e-commerce, and specifically its business with Amazon, that drives the bottom line, as Lee explains: "While e-com drives most of our financials, our specialty outdoor brand and community events are a core part of our identity and who we are." But the Amazon business is certainly what sets it apart. "We are the number one Amazon Prime retailer in premium outdoor specialty," says Lee. "We help brands maintain their brand and price integrity in the Amazon channel." Its expertise in Amazon distribution makes it uniquely qualified in the outdoors as a partner for that channel. "That, combined with our authenticity as an outdoor brand ourselves, our great brick-and-mortar store, and our amazing local events really make us who we are," he says. Lee says this brand and price integrity is at the core of the company's success in outdoor specialty. "Independent outdoor retailers have been and continue to be under siege," he says, pointing out that REI has put hundreds of stores out of business and now brands selling direct to con- sumers are taking another pound of flesh from local retailers. "The biggest threat of them all is Amazon with their ultra aggressive pricing," he explains, pointing out that last year ap- proximately 600 retail doors closed in the outdoor industry. "We aim to reverse that effect by restoring pricing stability in the Amazon chan- nel for our partner brands by being fully compliant with their pricing and advertising policies." He compares outdoor specialty to the recent history of virtually extinct local bookstores. "The fate of independent outdoor retailers depends on the brands being able to manage their channels with integrity," Lee adds. Gear Coop's primary competition includes other Internet sell- ers such as backcountry.com and Moosejaw, and of course REI and other local outdoor specialty shops. And as it continues to make significant investments in its own gearcoop.com website, Amazon becomes both a marketplace partner and competition. "Of course, we leverage Amazon's tremendous customer base and in our other channels we work hard to be relevant to outdoor enthusiasts of all ages by pushing out unique content to social media and email," Lee explains, pointing out that Gear Coop has always provided a clear value proposition such as free two-day shipping and free returns, and was among the first to do either one in the industry. Gear Coop takes great pride in being the number one Amazon Prime retailer in premium outdoor specialty. "It means that we are trusted to represent more premium outdoor brands on Amazon than anyone else in the industry," Lee says. Of course, its retail store is part of its own brand, but with the revenue being driven by its Amazon business Gear Coop struggles to live in two worlds. Maintaining both of them is a constant challenge for Lee and his staff. "The store's needs are often overlooked and neglected," he admits. "The buyers are focused on what drives their bottom line, which today is Amazon." O 20 17 GEAR COOP LIVING IN TWO WORLDS BULLET POINTS The company name can be pronounced two ways, explains Terry Lee. It is formally /geer ko - op/, but it is called "The Coop" by its friends and family. Customers are GearCoopers and its staff members are Coopers. Gear Coop plans to roll out some major enhancements to gearcoop.com, making it, in Lee's words, "a superior shopping ex- perience and delivering even more value to the customer." TRAIL MIX Headquarters Costa Mesa, CA Stores One Website gearcoop.com Sales $20 million Gear Coop leverages its Amazon status to become an Internet trendsetter. Caption here and be never more than one line long Terry Lee has his feet in two worlds — e-commerce and retail.

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