Dive Brief:

• REI Co-op is offering an expanded selection of gear and apparel online, the company announced on Thursday. Danner, ECCO and Salomon are among the first brands to participate by shipping orders directly to customers.

• The expansion allows customers to choose from a wider range of products. "This functionality opens up so many doors for our customers and gives them access to new sizes and styles of products that we could not stock previously," Curtis Kopf, chief digital officer at REI, said in a company release.

• REI is working with DSCO to provide dropshipping services. Orders fulfilled by brand partners can only be sent to home addresses.

Dive Insight:

REI's expansion allows it to increase its assortment without having to fit additional inventory into its warehouses. In addition, the outdoors co-op can glean new insights about its customers based on the orders placed via its partners. Partner products are listed in the same departments as ones shipped by REI, with some items from the initial partner brands bearing notes regarding shipping restrictions.

While dropshipping has gotten a bad rap from manufacturers in the past, many have found that it makes it easier to sell expensive or slower-moving items through more retailers. A recent Lehigh University survey of brands using dropshipping found that more than 80% of retailers said it increased their revenue, and more than 60% of retailers said it reduced their costs.

Among manufacturers who fulfill dropship orders, 53% said their profit margins increased. The practice also allows retailers to provide more options for their customers without taking a risk that they'll have to discount large orders that don't sell through as quickly as anticipated.

REI has been strategizing to provide more options for members, whether they shop online or in stores. In April, REI announced that it would expand the products available through its gear rental program, available in 115 stores, after a record sales year in fiscal 2018. The brand also offers the option to buy online, pick up in-store (BOPIS), and sells used gear as well, a piece of the business that has been expanded in recent years as consumers look to make more sustainable choices and brands consider the costs of refurbishing and reselling goods rather than dispensing with them.

The outdoor retailer in May decided to stick with its interim CEO, Eric Artz, as a replacement for former CEO Jerry Stritzke, and has also made changes recently in its marketing strategy. In June, the retailer introduced a print magazine and in September, announced increased credit card benefits for co-op member cardholders.