Trinka Dyer, Beyond.com's marketing director, will replace Brian Sroub as vice president and general manager of the consumer division, according to an internal email to Beyond.com employees sent yesterday and obtained by News.com. Dyer, who previously worked at Quaker Foods and Dreyer's Grand Ice Cream, has led the company's branding efforts, including advertising and marketing research, according to the email.
As Dyer steps up to the plate, Sroub, who joined the Sunnyvale, California-based company in May 1998, is being reassigned to work with Beyond's chief executive Mark Breier on special projects.
Beyond.com spokeswoman Lise Olson would not comment on the executive changes, saying only that internal matters are "proprietary" and that the company makes "decisions on a daily basis on who's right for a particular position."
Since Beyond.com changed its name from Software.net about a year ago, the company has banked on a national advertising campaign to transform the new brand into a household name, a tough sell in a crowded market, analysts say. While spending millions on advertising, the company has faced widening losses to $21.9 million last quarter compared to $5.1 million a year ago.
The site has been built up to offer more than 48,000 software titles with 6,600 available for immediate electronic download. Yet in the highly competitive realm of consumer software sales--dotted by companies including Buy.com, the recently merged Egghead and Onsale, Cyberion Outpost, Amazon.com, and even PC makers such as Dell--the Internet has become a particularly tough arena.
Some retailers have complained that aggressive pricing measures by rivals such as Onsale and Buy.com are shrinking already slim margins.
While unaware of this week's management changes at Beyond.com, Warburg Dillon Read analyst Sara Zeilstra said something is "clearly amiss" within the consumer division, which has spent much money on marketing and a high-profile television advertising campaign targeting consumers without great results.
About $20.6 million of second-quarter operating expenses--which were roughly $26 million--was spent on sales and marketing, she said. Yet consumer sales comprise just a third of Beyond.com's revenues, while the rest of its business comes from the company's sales to other companies and government clients, such as the Internal Revenue Service, Zeilstra said.
"The consumer business has really been the drag on the rest of the achievements of the company," Zeilstra said. "It's really been one area that hasn't been able to make a big turnaround. Overall sales, while good, aren't growing as quickly as people might have anticipated," she said.
Market research has found that Beyond.com isn't drawing the traffic that the analyst community had expected as a result of the marketing campaign, she added.
CNET, the publisher of News.com, holds an equity stake in Beyond.com.