Sears eyes systems as pitch lingers

Even as three shops await their fates on one major piece of business from Sears, Roebuck & Co., the giant retailer is about to embark on a major overhaul of its expansive, but outdated, marketing system.
Hal Riney & Partners/S.F., Young & Rubicam/N.Y. and Wells Rich Greene BDDP expect to hear next week which one won the retailer’s $40-million apparel division. The decision was supposed to have been made last week, but top Sears executives were meeting at a three-day marketing summit in Phoenix to discuss the presentations.
A spokesperson said the delay was due to scheduling problems.
Y&R was thought to have had the early lead, according to insiders, because of personal ties Y&R president Peter Georgescu has to Sears Merchandise Group head Arthur Martinez. Sources now say the review has turned into a two-way battle between Hal Riney and WRG in the final weeks.
The loss of a $40-million business from Chicago is a blow to the community. Leo Burnett also missed out on the $20-million Hyatt Hotels business.
Meanwhile, insiders said that newly named marketing head John Costello is in the process of revamping the way Sears approaches its marketing. He is expected to play a major role in bringing the store marketing together into one cohesive message, something O&M has been pushing Sears to do in the past. Costello also will be responsible for opening up the Sears credit system, taking advantage of a huge database that has been left relatively untapped, and allow the use of other credit cards beyond Sears and Discover cards. Sears is testing the use of Visa in some of its stores.
“That’s the key for them right now,” said one Sears insider. “His job now is to supply an advertising product. He has to build Sears as a brand, while maintaining the strength of the brands within the store.”
Costello is also expected to back away from the .reliance of the regular weekly pre-prints–the one area where Sears spends a major part of its huge advertising budget.
Sears spent close to $150 million in magazines, and newspapers last year, according to Leading National Advertisers.
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