December 26, 2000, 9:55 AM

The cyber side of Sears

Don Davis

Editor in Chief

Not to be outdone by discounters Wal-Mart and Kmart, Sears Roebuck & Co. recently let fly with e-commerce news faster than you can say Craftsman tools.

Late last month, the nation’s #2 retailer linked up with America Online in a partnership that will market AOL products to Sears customers and launch a cobranded version of AOL’s Internet service with links to Sears.com. Days earlier, Sears announced an online venture with home improvement guru Bob Vila, a pitchman for its Craftsman tools since 1989. Their third-quarter launch, BobVila.com, will offer products, services and content for the do-it-yourself set, with links to the Tool Territory section of Sears.com.

The deals position Sears squarely on a home improvement track online-and away from general merchandise, where the marts are engaged in a virtual slugfest. Analysts say Sears can build its brand strength in select categories into comprehensive Internet-based solutions, starting with the home. “The only thing that separates Sears from the rest of general retail today is their tool and appliance business,” says David Cooperstein, senior analyst at Forrester Research, Cambridge, Mass. “Using that as their lead-in to expanding online is a smart move.”

The AOL partnership dovetails with these moves. “It’s not your average portal deal,” adds Cooperstein. “Sears also will develop broadband content for home improvement and jointly develop Internet-enabled devices.” R&D, he notes, spells a deeper relationship.

Sears launched its Web site with Craftsman tools in 1997. Online sales of home appliances, automotive parts and its Wishbook Christmas catalog came next. Moves into consumer electronic and lawn and garden products are in the works.

Yet another e-commerce venture announced last month by Sears should keep the supply lines flowing. Sears joined with French retail giant Carrefour and Oracle Corp. to form the first global business-to-business exchange serving retailers. Job one for the so-called GlobalNetExchange will involve moving the retailers’ $80 billion in supply chain purchases to Oracle’s e-business platform on the Web. The trio plan to invite other retailers into the exchange, which they expect to begin operating by the end of March.

The latest moves by Sears emerge from an Internet division where leadership has been in a state of churn. Jane J. Thompson, president of Sears Direct, which includes Web operations, left last year. Most recently, Alice M. Peterson, vice president and general manager of Sears Online, left in February for other e-commerce opportunities. For now, her duties will be handled by Dennis Honan, who comes from the company`s information technology ranks. A Sears spokesperson says the company is “rethinking” its online leadership and wasn’t sure Peterson’s will be filled. Peterson, previously the company’s treasurer, headed Sears Online for less than 18 months. “Welcome to the world of Internet recruiting,” says one headhunter. “It happens all the time.”

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