|The Reverb team celebrated hitting ten figures in total sales since the platform's founding.|
Reverb Passes $1.0 Billion Milestone
Fast-growing music enthusiast marketplace draws praise from sellers and buyers alike with mix of merchandise and engaging content
MORE THAN $600 MILLION worth of music gear will be sold on the Reverb.com site this year. If it were a stand-alone music products retailer, it would rank as the second or third largest in the country. But as an online platform that allows thousands of individuals and businesses to connect with buyers, it falls into a different category. This “marketplace structure” explains why the site has been able to transact such an enormous volume without incurring the ire of either the retail distribution channel or the industry’s leading suppliers. That’s just the way founder David Kalt wants it. When he launched Reverb in 2013 he saw it as a complement rather than a competitor to the existing distribution channel. He envisioned a vehicle that would enable musicians to convert unwanted gear into cash and help even the smallest retailer develop multi-channel selling capabilities. Five years later, after some 250,000 sellers have moved more than $1.0 billion in merchandise on the Reverb site, it’s safe to say that those goals have been met.
For anyone with an interest in making music, the Reverb.com site is both a reference source with regularly updated articles and videos, and an “endless aisle” flea market with thousands of items offered for sale. This mix of merchandise and engaging content attracts approximately 12 million unique visitors a month. “It’s become an obsession with some enthusiasts,” states Kalt. However, it’s more than just an engaging place to while away a few hours.
For musicians, Reverb offers a solution to the age-old problem of what to do with unused gear. In a “pre-Reverb era,” Kalt says, a player would offer a guitar, keyboard, or drumkit to a pawnshop or advertise it in a local classified section. The best-case outcome in either scenario would be “50-cents on the dollar or less.” In many cases, low-ball offers would prompt the seller to stuff the gear back in a closet and forget about it. But thanks to the global reach of Reverb, Kalt says, a musician can get “full value for whatever they’re selling.”
“A lot of the dollars in used gear
generated on Reverb are re-cycled
back into new products.
We help musicians convert
under-used or unwanted stuff
into cash they can spend.”
Some argue that the used instruments sold on Reverb cut into the sales of new products. They contend that used guitars in pristine condition represent a compelling value, especially given the timeless nature of the most popular guitar designs. Kalt acknowledges the appeal of used products, but counters that a used sale on Reverb is not just a zero-sum proposition that cancels the sale of a new item. “A lot of the dollars in used gear generated on Reverb are re-cycled back into new products,” he says. “We help musicians convert under-used or unwanted stuff into cash they can spend.”
For retailers, Reverb has provided a valuable additional revenue stream. Listing on the Reverb site enables even the smallest operator to sell effectively online without a major investment in creating a website or heavy spending on search engine optimization or key search words. The Reverb staff even provides useful advice on how best to present individual products. “We really hold their hands,” says Kalt. This retail-centric approach has generated praise at numerous association gatherings from retailers who state that Reverb has added anywhere between 5% and 50% to their top line.
From Kalt’s standpoint, helping retailers present products more effectively is a benefit to users. A staff of ten in the Chicago headquarters reviews all product listings, checking to make sure that pictures and descriptions match, that pricing isn’t “too good to be true,” and that the presentation is “credible.” This time-consuming review is part of Kalt’s larger strategy to make Reverb what he calls a “trusted brand, a place where consumers feel confident making a purchase.” He adds, “a customer that has a good experience with a seller is more likely to buy from them again or recommend them.”
“There’s still a lot of untapped opportunity.”
Given the volume of business done on the Reverb site, the occasional disputed transaction is inevitable. Management takes a carefully even-handed approach in resolving disputes and unlike other sites doesn’t start from the assumption that the consumer is always right. “We’re not seller- or customer-centric,” Kalt says. “We review each case and make a decision based on the facts. Sometimes we rule for the customer; sometimes we rule for the seller, but we work hard to be fair.”
The appeal of Reverb’s trove of well presented products, musician-centric search tools that help users sift through thousands of guitars, and a musical vibe transcend national boundaries. The site is available in five languages—English, French, Germany, Spanish, and Japanese—and sales volumes outside the U.S. are growing at a brisk clip. There’s even a new section that offers used LP records, and Kalt is exploring the possibility of including a booking agency function for musicians. “We understand the enthusiast market,” he says. “There’s still a lot of untapped opportunity.”