The State Of The DJ Market

Pioneer DJ President John Powell opens up on what’s hot, why EDM will continue to grow, and where the market opportunities are in a wide-ranging interview.

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WHAT'S THE CURRENT STATUS of the electronic music market? Has EDM peaked, or is there still room to grow? What’s the most popular format for DJs? We put these and other questions to John Powell, who as president of Pioneer DJ US has a unique industry perspective. His outlook is also informed by his career stints at other top professional audio firms.

Pioneer DJ traces its roots back to 1937 when Nozumu Matsumoto opened a radio and speaker repair shop in Tokyo. Within a year, he was manufacturing small speakers for radio manufacturers. The Pioneer trademark was adopted in 1946, and the company expanded into a broad range of consumer electronics products including hi-fi systems, tape players, headphones, and televisions. Pioneer innovations include the Laser Disc and the first recordable DVD. In 1994, the company entered the DJ market with the first CD DJ player.

Pioneer’s consumer electronics business struggled to adapt to the seismic technological and market changes of the early 2000s, prompting a major restructuring. The company exited the consumer audio and television business to focus on automotive electronics. In 2015, the thriving DJ division was sold for $550 million to KKR, a leading private equity firm. At the time of the transaction, Hirofumi Hirano, CEO of KKR Japan, said, “Pioneer has built a leading global DJ equipment business based on its powerful brands and excellence in matching product development to market requirements. KKR will work together with Pioneer DJ’s innovative management team to support further long-term growth of the business.”

In the past nearly five years, Pioneer has maintained its dominant position in the global DJ market with a consistently innovative product line. That tradition of innovation continues at NAMM, where the company will unveil a slew of new products, including the XDJ-XZ, a powerful “all-in-one” controller. Herewith, John Powell’s take on the DJ business.

You bring a lot of pro audio experience to your new post at Pioneer. What led you to the audio industry in the first place?

I have always loved a wide variety of music and audio technology. My first real job after college was with JBL, and it allowed me to bring together my enthusiasm for music with my sales and business degree. I love everything about the industry, including the fact that I come to work every day, and we’re essentially selling creativity in entertainment.

My job is exciting and dynamic and is always evolving and changing. It’s thrilling to hear something that was well recorded being replayed and reinforced as perfectly as possible. Listening to a pristine sound system after you spent many hours designing and setting it all up, seeing hundreds if not thousands of people enjoying the music—it’s so cool.

I’ve had the opportunity to meet producers like Quincy Jones, and recording engineers like the late Ed Cherney. Meeting people of this caliber and discussing the importance of music and quality recording and reproduction were amazing experiences.

How would you characterize your management style, and what strengths do you think you bring to the new job?

My management style is very collaborative. I like to have a team where everyone has a voice—as a music professional, I like harmony. My style is rooted in mentoring and guiding and encouraging. I want people to think for themselves, and I don’t want to micromanage. Good ideas can come from anyone, so you need to make sure the entire team feels free to speak up and explore new ideas.

"I think electronic music has a bright future.
Today’s younger audiences that are
experiencing music in a live, ambient atmosphere
are definitely more inclined to electronic music
than previous generations."

Can you give a little background on how a consumer electronics company like Pioneer ended up in the DJ market in the first place, and what has made it so successful?

Sure, back in the mid-1990s, Pioneer Electronics was trying a lot of different things. They were making plasma TVs, home theater systems, home and car stereos and such, and in ’94, they made the first DJ product and arrived at something new and successful that continued to grow. Pioneer DJ split off from Pioneer Electronics completely five years ago, and they have no participation in our business now.

Based on the price paid for Pioneer DJ five years ago, KKR management obviously thinks the DJ/electronic music products market has a bright future. Could you share their perspective, or perhaps your own thoughts on the market’s future potential?

Investment companies like KKR typically look for a valued asset that’s distressed, and maybe they can clean it up, or, in the case of Pioneer DJ, a valuable asset within a larger organization that they can separate off and allow it to find greater success. That’s what happened with Pioneer DJ.

We’re a relatively small part of KKR’s business—they handle multi-billion-dollar companies—but you know, we’re very, very successful, our business is growing, we’re paying the loan back quickly. Our company is far more valuable now than when they acquired us, so it has been a very mutually beneficial relationship.

Given the broad range of products offered under the Pioneer DJ brand, it seems the company is aiming beyond just the DJ market. Who are the various customer groups you’re addressing, and how would you characterize them?

I think electronic music has a bright future. Today’s younger audiences that are going out to clubs and festivals and spending money on experiencing music in a live, ambient atmosphere are definitely more inclined to electronic music than previous generations. So, I think that has a bright future, and we just saw that even in an uncertain economy, we’ve been able to grow our business. The market is strong, and the music itself is evolving, which drives interest, innovation, and, ultimately, business.

Electronic music is definitely becoming more mainstream. Modern DJs are now at the top of the game and are the ones creating something new and exciting. There’s a lot of creativity involved to become a master DJ, just as it’s challenging to become a great guitar player, violinist, or anything else. The contemporary DJ stands on an equal footing with any other kind of musician.

So, beyond the core DJ market, where do you see the opportunities for growth?

For Pioneer DJ, our most significant growth opportunity is in pro audio. We currently offer a range of loudspeakers and we’re growing the line by leveraging a strong DJ following to adjacent markets such as clubs and lounges and electronic music festivals.
Electronic dance music is very dynamic and demanding. There are deep bass notes that are very quick and “get in and get out,” and you can’t have a bass that sits there and lingers like, say, a cinema speaker. It’s a very different kind of music, and we built our speakers for that dynamic.

Whenever there is dynamic music—be it a rock band, a DJ, or a jazz ensemble—our speaker will be very accurate, smooth, and responsive. We have a series of high-performance powered speakers and some amazingly high-quality passive speaker systems that perform very well with any style of music—much better through our speakers than with any of our competitors.”

"I don’t think there’s any bubble to burst;
the EDM genre is simply evolving.
It’s similar to how rock ’n’ roll
split up into many styles."

How do you view what may be called a fragmented DJ market, comprising performers, producers, and electronic musicians of various skill levels?

I don’t think it’s a fragmented market at all. DJs and electronic music performers represent a wide range of styles and tastes, but they are all just creating their art and music with the best tools for their craft. There is a lot of crossover with the technologies. I think it’s like anything else; you use the right tool for the job.

In the United States, we have many mobile DJs—who bring the equipment to wherever they’re going to perform. Some are laptop-based using DJ controllers as their interface. Others prefer to use DJ mixers and players, while others prefer an all-in-one solution.
The idea that the market is fragmented depends on which way you prefer to make your music; with vinyl, with USB drives, or with CDs as the source. We’re even starting to see streaming content come into play in smaller events. So, it’s just many ways to approach creativity.

Your thoughts on the distinctions between a DJ and a producer?

Many DJs certainly are producers, and it just depends on their craft and what is being produced. Some DJs work with existing content—much like a cover band—and some DJs write, create, and produce all their own original content. Like any creative industry, it’s a vast spectrum.

I think Avicii really was a pioneer. He was one of the first to write, create, and sing, producing a full-on performance. I admire him. He was not afraid to try new things. A DJ can also be a producer creating songs and music, but they don’t necessarily care to perform.

Initially, DJs were limited to vinyl records as a sound source. Now, they can use CDs, MP3 files, samples, streaming audio, electronically generated loops, and probably a lot more sources that I’m overlooking. How has this diversity of sound influenced your product development? Are users gravitating to any particular format, or is this diversity the new market reality?

Yes, originally, there were vinyl records, then CDs, MP3 files, samples, streaming audio—I think CDs are pretty much gone now. For manufacturers, optical drives are getting hard to find. Ironically, those were intended to replace vinyl. I think vinyl stays relevant, and it has a unique sound and that old-school coolness and cachet that keep it in the spotlight.

We have recording vinyl, which is a simulated version of vinyl. It’s a vinyl blank that is connected to a laptop through USB. It looks like a record that has nothing on it, so you use a computer electronically to kind of lay sound over that, so the DJ is moving that record back and forth with their hand—as you would the old-style records—but not actually destroying a vinyl record. Vinyl and simulated vinyl DVS are definitely one of the options and are quite popular.

On the other end of the spectrum, streaming media and cloud-based content and tools are getting popular. The content is being used similarly, but it’s coming through a wireless network rather than a directly connected device.

"Laptops, computers, software, technology—
they are just tools.
It’s the artist and performer who bring
any instrument to life."

Pioneer sells direct and through different retail channels. How do you manage this in a way that creates incentives and opportunities for all of your channel partners?

I think delivering great products and technologies that drive profit is a big incentive. But it comes down to different channels for different segments of the market. For the beginner who is new to the market, we connect online. Amazon, for example, meets the needs of many beginners. For the more advanced or the semi-professional, we connect through traditional brick-and-mortar locations such as Guitar Center and Sam Ash, as well as online retail outlets like AMS, B&H, Sweetwater and many others, all of whom have strong followings.

For the working professional, we have a network of performance and pro-audio partners in addition to those listed above, who can provide the design and guidance necessary for the artist’s specific needs. We have demo programs and internal teams and programs that cater to the high-end market.

Has the EDM bubble really burst, as some in the media are saying? Or is it just evolving? Any thoughts or concerns about how these trends might impact the DJ market?

I don’t think there’s any bubble to burst; the EDM genre is simply evolving. EDM is here, it’s popular, and has been growing consistently. I think it’s going to continue to evolve and adapt, and we’ll start to see sub-genres merge, morph, and develop their own audience and space within the industry.

A lot of EDM people are starting their own labels, especially with the streaming industry evolving. We see legislation starting to take notice of streaming and how electronic music is so prevalent at Spotify, SoundCloud, and other places. So, no, it’s not going to burst.

It’s similar to how rock ’n’ roll split up into many styles. It started with Elvis and the Beatles, and then it got heavier and heavier. Now there’s punk, prog rock, metal, death metal; there’s room for all tastes. EDM is doing something similar. It’s becoming more mainstream in many cases, and I think technology has a lot to do with the evolution by helping artists push the limits of what’s possible.

How do you respond to the critics who deride DJs as “glorified button pushers?”

I think it’s insulting, uninformed, and unnecessary. Like any discipline, there is a huge range of interests, tastes, and abilities, and it all just depends where you are and where you want to take the craft. Laptops, computers, software, technology—they are just tools. It’s the artist and performer who bring any instrument to life, whether it has strings, keys, or buttons.

Could you cite a few of the artists that you feel are creatively exploiting the potential of your products, and give a little insight into what makes them interesting?

Sure, Roger Sanchez comes to mind as someone who uses the CDJs as a tool, exceptionally well. When we’re thinking about turntablism, there are so many good freestyle artists out there. DJ Puppy is unbelievable. We’ve worked with Jazz Spinosa to develop equipment. Honestly, there are too many to name but we always solicit key artists’ opinions when designing new gear.

I think that today we’re empowering a new generation of performers with our DJ, Pro Audio, and Studio lines. Although at Pioneer DJ we don’t pick favorites, there are a few artists we have recently worked with in the U.S. that have been using our products in fresh and exciting ways.

When I think CDJ/DJM: artists such as Roger Sanchez, Trentino, and Golf Clap are pushing the boundaries of mixing and live mashups. For example, Roger mastered four-deck mashups, while Trentino has brought his Red Bull 3Style scratch performance from turntables to CDJs! When I think DJM-S9 and PLX-1000, I have seen K-Swizz, Buck Rogers, and A-Trak take our products to the next level. For example, K-Swizz won the 2018 DMC world championship at just 14 years old while rocking our S9 mixer! Lastly, within our TORAIZ category, Latroit, Michael Stein, and Sickick have really explored the creative potential of our music production line. Latroit used our AS-1 monosynth for a bassline that helped win him a Grammy for a Depeche Mode remix!

Pioneer has a history of innovation in the DJ market, having created the first CDJ. Could you shed any light on future products or technologies currently under development?

Actually, we will introduce a few exciting new products at NAMM this year. We’re always innovating our products, and we’re obsessed with looking at how DJs use our products and figuring out what features we add to help them be more efficient and effective in their work, and give them the tools and control to create the sound they’re looking for.

www.pioneerdj.com