MyPillow lays off 140 workers because of slower sales

A delay in new commercials and slower sales have led to an inventory glut for MyPillow, and the Chaska company has laid off 140 of its 1,600 employees, CEO Mike Lindell said.

"I was so devastated by having to do it, but we don't have room to make any more pillows," Lindell said. "When we get our advertising done we are going to be hiring back."

MyPillow does direct-to-consumer marketing, and new advertising drives consumer purchases. Lindell said he's been working on new commercials since January. The company hoped to release the new campaign in February, but it got delayed and now the commercials might not be ready until mid-May, he said.

"They are very complex, they are very exciting, they are very amazing," he said, but the complexity led to the delays. "There are going to be a lot of surprises for the public."

The layoffs came after Lindell and MyPillow added 500 new employees in October and November. In January, the company handed out $1-$2 per hour raises to its entire workforce.

"Commercials have to be fresh, or you don't make your number in direct advertising," Lindell said.

In January, the Better Business Bureau of Minnesota and North Dakota lowered its rating on MyPillow from an A+ to an F, citing the company's persistent "buy-one-get-one-free" promotions.

Lindell said the new commercials were planned before the BBB's rating change, but taking down the old advertising before the new ones were ready had a direct effect.

"I don't know if them coming out with an F rating, if that hurt our sales or whatever, but obviously we are not at the same sales level we were before they did what they did," Lindell said.

Some older ads were modified, he said, but aren't driving enough traffic.

Lindell said some of the new advertising will feature a promotion in which MyPillow will give away one new pillow to homeless shelters for every new pillow ordered.

"I want to give away four to five million pillows over the course of the next year," Lindell said.

Once new commercials come out, Lindell hopes they will jump-start sales and he'll be able to start hiring again.

Patrick Kennedy • 612-673-7926