Costello Quits Sears To Sell Used Cars

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Written by Jimmy D. Moody
Monday, 09 February 2009

Republic Industries, taking another step to sharpen marketing of its AutoNation USA brand, has hired Sears, Roebuck & Co. turnaround guru John Costello as its president.

Mr. Costello, 52, who worked for Procter & Gamble Co. and Pepsi Cola USA, joined Sears in 1993 as an outsider whose task was to revitalize marketing at the ailing retailer. One of his first tasks on the job was to hire Young & Rubicam and Ogilvy & Mather as Sears' two advertising agencies and point them in the direction of Sears' "Softer side" campaign, pushing its higher profit apparel merchandise, in addition to its well developed hard goods businesses, such as Craftsman Tools.

SEARS' EMPHASIS ON WOMEN

The focus on women as the retailer's key customers, to the point that employees always referred to its target audience and customers as ``she,'' helped drive Sears' performance during Mr. Costello's tenure.

In recent months, however, Sears, like other department stores, has been losing sales to discounters and specialty stores.

In replacing Mr. Costello, Sears has turned to a retailing insider and industry veteran, Mark A. Cohen, 50, to be exec VP marketing. Mr. Cohen formerly was Sears' senior VP merchandising, full line stores. Previously, he was CEO of Bradlees and CEO of Federated Department Stores' Lazarus chain.

Mr. Cohen wasn't available for comment on whether he plans to make changes in Sears' advertising or its agency lineup. But the company's declining sales need a boost, which might presage some shifts.

NEW AND USED CARS

At Republic, Mr. Costello will oversee the company's two major business units: new and used automotive retail and its automotive rental brands, Alamo Rent A Car, National Car Rental Systems and CarTemps USA, reporting to co CEO Steven R. Berrard. Mr. Costello becomes the third marketing heavyweight snared by Republic recently. Bob Thomas, formerly CEO of Nissan Motor Corp. USA, joined Republic in October 1997 as exec VP strategic marketing. John Bradley, director of media and planning at Best Buy Co., also joined Republic as director retail.

The addition of Mr. Costello has led some advertising executives with competitive auto marketers to sit up and take notice of Republic.

"The perception of Republic has been one of a Wall Street play" profiting from market gyrations instead of actual business success, said one ad executive. But the ``investment in key people'' is leading him to perceive the company more seriously, he said.

AutoNation, with a one price, no haggle policy, is attempting to reinvent the automotive industry's scarred marketing reputation, one where the automotive buying experience is considered an attempt by a slick salesman to out negotiate his customer. AutoNation's goal is to become a brand customers will stick with for their lifetime.

Last Updated ( Monday, 09 February 2009 )