CLOSINGS Halts Catalog, Web Operations The fat lady may not have sung yet for, but she has certainly cleared her throat. In January, after only 14 months in business, the Portland, OR-based women’s sports apparel cataloger/retailer laid off 57 of its 95 employees; it was scheduled to close its e-commerce and print catalog operations on Feb. 9. The company’s only remaining channel is its 900-sq.-ft. store at a Crunch Gym in New York.’s Achilles’ heel was no different from that of numerous other failed dot-coms: “The cost of customer acquisition for the Website and catalog channels was quite high,” says Vicki Reed, vice president of marketing. The company had planned to spend one-third of its $15 million-$17 million marketing budget on online ads, and the remainder on print advertising and sponsorships of athletic events such as tennis tournaments. But, Reed says, “We just don’t have the financial legs to keep [the Website and catalog] afloat until we come out of the red from our customer acquisition costs.”

Reed says that in addition to shortening its name to Lucy, the company will continue manufacturing its own clothing line and “plans to open three to five stores in the next six to nine months.” But that task could prove difficult with a skeleton staff. “There is a transition team of about 20 or so people that will be here only for the next several weeks,” Reed says. “After that, there will be only about 12 or so employees.”

Since its debut in fall 1999, the company launched a Website, mailed 1.5 million print catalogs, opened a store, and introduced a private-label line of clothing. The company hopes to eventually be able to relaunch its Website and catalog, though it hasn’t set a target date for doing so. But Reed says that the advantages of a multichannel operation are many – if those channels are solid. “We’re taking a step back to establish stores, which is less expensive than maintaining our Web business,” she says. “With the Website, our biggest challenge was just getting people to remember to go to the Website or shop our catalog. We didn’t have a retail presence for them to drive by and be reminded of. Now we want to establish the retail channel first.”

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