Industry Sales Advance In The Face Of Strong Headwinds
...below the pre-financial crisis peak. On a positive note, however, retailers and suppliers seem to have finally finished with the arduous task of recalibrating their business to the more austere climate. The resulting stability has improved the outlook dramatically, enabling businesses to once again focus their energies on rekindling growth.
What we refer to as the “music products industry” is actually a collection of about a dozen product categories. Given this diversity, sales results varied significantly among the product categories due to the volatile combination of economic trends, evolving musical styles, and advancing technology. A rebound in the housing market bolstered acoustic piano sales, while shifting musical tastes contributed to strong gains in the acoustic guitar market. DJ and music production products rode the popularity of electronic dance music (EDM) to achieve robust sales gains. Unfortunately, the same trend may have adversely affected entry-level electric guitar sales.
While each of the product segments faced its own unique market dynamics, there were two emerging issues that confronted all of them: namely, growth in the sale of used products and the economic woes of the under 30-year-old demographic. As chronicled in the columns of Music Trades, for decades manufacturers and retailers have worried that there would be a calamity if all the unused instruments suddenly came on the market. Thanks to Craigslist and eBay, online marketplaces that traffic heavily in used gear, that day seems to have arrived.
Given these headwinds, it should be encouraging that industry sales held up as well as they have. The best explanation for their resilience is the ongoing advances in product value. Major strides in technology continue to improve the feature/price ratio of any product that contains a digital chip. However, the improvements have not been limited to the realm of high-tech. Human ingenuity has found ways to enhance the value and performance of acoustic guitars, wind instruments, and percussion products, yielding what can best be described as a “golden age.” This continued progress is the best hope for rekindling industry growth.
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