Last week, while Warner Bros. Records was merging the WB and Reprise promotion staffs into one, WEA was also letting go about 25 staffers, including longtime employees Paul McDermott and Paul Solce.
According to sources, those cuts were largely from the field sales staff, which services smaller accounts.
The cuts were made after the company began experimenting with a new online ordering system in January that allows smaller accounts to put product in their baskets and order online directly from WEA, instead of waiting for a WEA sales rep to call on them. "What we found is that those accounts ordered more frequently and ordered more product," says one Warner Music Group insider. So WEA So decided to roll it out to more merchants, which resulted in the staff downsizing. Stores now ordering online will still see the occasional WEA staffer, but from the marketing side of the company. The WEA national account team was unaffected by the move.
Another WMG source says that the both the WEA cuts and the Warner/Reprise promo consolidation are part of the planned $50 million-$65 million in cuts Warner disclosed to bondholders in July that it said it would make over the next 27 months.