CompUSA Rethinks E-Strategy

Retailer Dismisses Mullen, Assumes’s Advertising
BOSTON–Computer retailer CompUSA has pulled advertising for its struggling Internet commerce division from Mullen and placed the agency on 90-day notice.
CompUSA took the action two weeks ago after an estimated $10-15 million television campaign launched in October failed to stimulate strong holiday sales for
The retailer is trying to sell remaining Cozone broadcast time to other advertisers, or if unsuccessful, to substitute its spots for Cozone placements, said CompUSA official Suzanne Shelton.
Executives with the agency, which was hired in April, referred calls to the client.
“We won’t need their services,” Shelton said of the Wenham, Mass., agency, though she did not go so far as to blame Mullen for failing to drive sales.
Cozone’s debut TV campaign from the shop starred celebrities including basketball player David Robinson, Donald Trump and Dr. Joyce Brothers. The spot with Trump featured the “The Donald” ogling attractive young women in a pottery class.
Though the humorous ads were well received in creative circles, Cozone’s sales grew only $1.5 million–from $6 million in the third quarter to $7.5 million in the fourth quarter, said David Goldstein, president of Channel Marketing, a research company in Dallas.
For its second quarter, ended Dec. 25, CompUSA reported a $16.8 million loss for Cozone. It noted in a statement: “The sales results at were well below the company’s expectations and the company is re-evaluating the role of in the company’s overall e-commerce strategy.”
Analysts who follow CompUSA said a lack of synergy with the parent company doomed Cozone from the start. “There’s no brand leverage and no brand recognition,” said Goldstein.
It is unclear if the Cozone brand will continue, Shelton said.
In a related development, Stephen Polley, who helmed Cozone operations, has resigned. No successor has been named. CompUSA has also shifted Cozone’s marketing and advertising operations from Cozone’s Marlborough, Mass., office to CompUSA’s Dallas headquarters.
CompUSA is currently being purchased by Grupo Sanborns, a Mexican conglomerate, for $798 million. The transaction is expected to be completed by month’s end. K