I took up guitar playing as an undergrad at Indiana University. As I recall, someone told me that if I strummed the guitar and brought along a six-pack of Bud, coeds would fall at my feet! Unfortunately, the latter didn’t happen, although they did down all my beer!I still play, and I’m sure all guitar pickers would agree when I say the C.F. Martin & Company is legendary for making exceptional hand-crafted all-wood guitars. If you can get a Martin for under $2,000 it’s a real bargain.
Not surprising, in this economy sales of expensive Martins has taken a hit. But a recent report in the Wall Street Journal is an intriguing look at how Martin has been dealing with the tough times. And, it raises some interesting questions for us to consider in the boating industry.
Martin has introduced a new line of solid wood guitars they call the “1 Series.” But the “1 Series” is selling for under $1,000! As might be expected, the marketplace has embraced the new guitars. After all, Martin guitars are luxury items and that makes them targets of cost-cutting by consumers during the recession. Sales of the high end models have taken a big hit. But, getting Martin quality for under $1,000 has made it affordable. That’s why the first production run of 8,000 guitars totally sold out.
Boosting company sales was, of course, a major objective in creating the “1 Series.” But, interestingly, one of Martin’s biggest motives was also to keep their skilled employees on the job. To Martin, following the usual business model of cutting payroll to compensate for reduced sales would mean the loss of expert woodworkers who hand-craft much of the luxury high-end instruments. While Martin also has a line of low-end laminated plywood guitars, the company opted to change and modify some of its processes and turn out the new all-wood “1 Series.”
Martin’s story raises some interesting questions about the future of the boat business. For example: While it’s likely the pent-up demand for large boats that has been building up during this recession will carry that segment into more prosperous times, there is no such certainty about small boats. Indeed, that segment may well need something to get people who otherwise won’t spend the money for the high-end rig to still buy an “affordable” one. In fact, it’s probable the industry will have to stimulate the small boat segment and our own version of a boating “1 Series” will be needed. But who will build them and who will be selling them?
The current recession, and the clear need for some innovative thinking as we look to come out of it, should have every dealer seriously asking his builder(s) how they are changing their business models for post-recession success? If a builder doesn’t even recognize a need for change, it’s the cue for a dealer to seek out other builders who do!
Enjoy today’s “How I Discovered Boating” video: http://www.youtube.com/watch?v=K5JhXXzP3bs