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Thousands Of Visitors And Thousands Of Assessments

...panned it as “a big waste.” Opinions on the state of the industry expressed at the show were equally divergent, running the gamut from “sales are poised to take off this year,” to “we’re in a tailspin.” Beyond dispute was the fact that for four days in January, the Anaheim Convention Center housed the world’s most comprehensive selection of music and sound gear, and the extravagant displays served as a magnet for buyers and enthusiasts from around the world. To put it in numeric terms, the show pulled in a record 106,928 visitors and a record 1,779 exhibitors.

Through the cacophony of endless drum solos and guitar riffs, a few common themes emerged during the course of the show. Industry sales seemed to enjoy a positive post-election bump, although it’s not clear whether the gain was the beginning of a trend or merely a short-term spike. The retail distribution channel remains in a state of flux. Brick-and-mortar operations continue to evolve in response to online competition. But, the online world is hardly settled either. Rising shipping and online search costs, coupled with competition from the likes of Amazon, are challenging more specialized online merchants. The “I want it my way” generation that demands 200 variants on a simple cup of coffee from Starbucks has spurred the music industry to continually expand its offerings; thus in every product category from guitars to grand pianos and synthesizers to cymbals, the number of available models on display was at an all-time high. In short, the NAMM show was a continuation of recent trends.

Given the diversity of participants, the show was different things to different people. For the nearly 400 first-time exhibitors, it was a launching platform for getting their products into the market. Social media, email, and websites may be powerful marketing tools, but nothing yet compares with the persuasive power of face-to-face trade show meetings. That’s why David Koltai, of Absara Electronics, lavished praise on NAMM for helping him launch a new line of Supro guitars. “The show put us on the map,” he said. “The results were well beyond our expectations.” Petar Chekardzhikov, another first-time exhibitor and head of Cling On Tuners, was equally enthusiastic. “The show was fantastic,” he said. “We pretty much sold out our inventory just during the four days, and we signed up several international distributors. The thing that most surprised us was the appreciation and interest we got from guitar, ukulele, and banjo manufacturers here in the U.S. and abroad. We will be partnering with several of them.”

Making Strong Connections
More established companies that aren’t looking to establish distribution also found the event of value. Andy Mooney, CEO of Fender Musical Instruments, noted, “When I was at Nike, we pulled out of some trade,shows and it was a mistake. You have to be here to show your products and gauge the reaction of the market.” Craigie Zildjian, CEO of Zildjian Cymbals, expressed a similar opinion, stating, “The connections we make and the energy we feel at NAMM is nothing like any other place we go.” For Michael Skinner, president of DANSR, the U.S. distributor of Vandoren Reeds and Dennis Wick brass products, “NAMM allows us the ability to address the needs of our clients and customers in one place, and having the international companies here allows us to meet and have face-to-face conversations under one roof.”

A frequent observation at the NAMM show is that “dealers don’t place orders at the show anymore.” There’s a large degree of truth to that. Thanks to better communication, news of new products and special offers gets broadcast well before the show, and retailer groups like the Alliance of Independent Music Merchants (AIMM) encourage members to come to the show with a plan and avoid making “impulse” buys. Yet, order writing remains an important component and an effective indicator of retailer sentiment. Mark Terry, president of KMC Music, observed, “I know this isn’t supposed to be an order writing show, but we still wrote a lot of business over the past four days, and it’s encouraging as we make our plans for the coming year.” Guy Coleman of VocalBooth was even more direct. “We wrote so many orders at the show, we’re scrambling to increase our production,” he said. “It was a great show.”

Publications running the gamut from Rolling Stone to Forbes have prominently declared that rock ’n’ roll and the guitar are dead. However, you’d never know it from the activity at the NAMM show. Guitars and guitar-related products continued to dominate the exhibition floor, and prominent guitarists, from John Mayer at the Paul Reed Smith exhibit to Dwight Yoakam at Martin Guitar and John Petrucci at Music Man, drew enormous crowds. By our count, there were at least 24 new guitar brands introduced into an already crowded market. 

Electric Guitar Rebound
Two fretted instrument trends were apparent at the show, one somewhat surprising, one pretty obvious. The surprise: after nearly a decade of decline, the electric guitar is staging something of a comeback. Electric guitar makers at the show reported an uptick in business, and the shift in consumer preferences was confirmed by Michael Doyle, vice president at Guitar Center, and Sammy Ash, vice president of Sam Ash Music, both of whom said electrics were “up.” The not-surprising trend was the continued strength in the effects pedal market. The low barrier of entry for new pedal makers has led to dozens of new entrants in the marketplace, which seems to have spurred consumer demand. As one pedal maker noted, “It’s kind of like the craft beer market: More choices create more interest.”

At points in the recent past when the fretted, technology, or audio segments were enjoying rapid growth, there was a tendency to speak dismissively of the school music business as “sleepy” and “slow growth” because of limited product innovation and a predictable market. In the aftermath of the recent market upheavals, though, the stability of the school market has become an object of envy. After four days of the NAMM show, indications are that 2017 will be another strong year for school music. Conn-Selmer President John Stoner said, “Everything was positive at the show. We are looking forward to a strong year.” Voicing a similar opinion, Yamaha’s Tom Sumner of said, “Yamaha had its best NAMM show ever. We exceeded every goal we set for the show and were happy to see our dealers’ positive mood.”

Fickle Buying Public
The music products industry, like clothing or home décor, is subject to abrupt changes in the preferences of a fickle buying public. Nowhere was this more apparent than in the realm of electronic musical instruments, where the renewed interest in analog tone generation continues to gain strength. Analog pioneers Sequential Circuits and Moog, both of which were driven into bankruptcy in the 1980s by digital technology, experienced a surge of interest at NAMM. Simultaneously, companies that introduced digital technology to the industry were proudly displaying new analog instruments. In the case of Korg, it was a reissue of the early 1970s-era ARP Odyssey. For Roland, it was an expanded offering of its top-selling analog synths from the early 1980s. Riding the wave, NAMM sponsored a special exhibit space that housed more than a dozen boutique analog synth firms.

NAMM has effectively displaced the Frankfurt Fair as the industry’s primary global showcase, and this year, the international participation continued to grow. 17,964 representatives, up 13% from last year, from 125 countries were present. However, for American suppliers in particular, export markets were challenging on a number of fronts. The strength of the dollar forced 8% to 20% price increases in markets around the world, prompting complaints from distributors. The sluggish economies in much of Europe, as well as steep declines in former growth markets such as Brazil, added further pressure to export sales. To top it off, tough new CITES regulations on the export of rosewood left guitar makers struggling to figure out how to export legally. (See stories elsewhere in the issue.) Interestingly enough, one of the beneficiaries the tightened export market may well be the independent retailer. As one prominent supplier explained, “There’s no growth in export markets. Guitar Center, with its focus on private brands, has become more of a competitor than a customer. So, we are placing more emphasis on working with independents to create growth.”

NAMM CEO Joe Lamond aptly describes the annual show as a “stable, reliable platform for growth, both in business and in professional development,” and based on the amount spent to participate, attendees are clearly looking for some type of commercial return. But, the show isn’t all about business: it’s also a celebration for those who have made a career of serving the world of music. The value of this affirmation isn’t easily quantified, but is significant nonetheless. NAMM Management contributed to the celebratory environment with a series of compelling performances on the Nissan NAMM Grand Plaza Stage in front of the Convention Center. The show kicked off with a Thursday jam featuring rock guitarists RSO: Richie Sambora and Orianthi. On Friday night, The NAMM Foundation’s Celebration for Music Education welcomed former New York Yankees center fielder and Turnaround Arts music education advocate Bernie Williams and his All-Star Band, plus special guests legendary percussionist Poncho Sanchez and fellow Turnaround Arts artist Keb’ Mo’. On Saturday, The NAMM Foundation and The John Lennon Educational Tour Bus presented R&B songstress Ronnie Spector and The Ronettes, with a special introduction from Jackson Browne.

Even Bigger Next Year
NAMM management is confident that increased international interest will fuel continued growth for the trade show. By next year, construction on a 200,000-square-foot addition to the Anaheim Convention Center will be complete, allowing for an expansion and reconfiguration of the show. Exhibitors will be organized into nine “communities:” fretted instruments, percussion, orchestral strings, band and orchestra, keyboards and synthesizers, pianos, lighting, software and technology; and DJ and pro audio. Lamond says that the new format will be consistent with previous shows, but should provide a more comfortable setting for visitors and a more effective showcase for exhibitors. 

Four days of total immersion with industry peers is supposed to facilitate clear-eyed forecasting for the coming year. However, the unexpected events of the recent past, ranging from the continued popularity of the ukulele to the surprising results in the recent Presidential election, led to a tempering of bold predictions. Here’s one safe bet though: given the profusion of high quality products on display at NAMM, and the intense competition at retail, the buying public will be increasingly selective when opening their wallets. In this environment, there is little room for “average.” Excellence is now the cost of market entry.

For much more coverage of the 2017 Winter NAMM Show – including exhibitor news, educational forums, and post-show survey data – see the March issue of Music Trades.

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