Marketing Lessons from Gibson Guitar’s Bankruptcy

business lessons

What can we, as business owners and builders, learn from the Gibson Guitar bankruptcy?

Some of you may know that I’m a musician. One-time member of AFM Local 580. And while I’ve never owned a Gibson, I do have some insights into what went wrong, and why they are now in the mess they are in. They are claiming acquisition debt, but they made other, more disastrous mistakes, and these, I believe, are the ones we can learn from.

What Gibson did wrong #1:
They messed with their signature model. The Les Paul was THE Gibbie to own. Until they started adding things customers didn’t want, like auto tuning machine heads. That’s NOT what a Les Paul WAS in most players’ minds. It was fine to add those ditties to OTHER models, but NOT to the Les Paul.

What we can learn #1:
Customers/clients come to expect certain things when it comes to “signature” products and services. Don’t disappoint or annoy them by changing these too much. Want to add some new shiny bit? Do it in a DIFFERENT package, or offer it as a supplemental service. Who knows? Your “new” creation may become tomorrow’s “signature” piece. But for now, until the new starts outselling the old, don’t kill the goose with the golden egg.

What Gibson did wrong #2:
They tried to become a “lifestyle” business – dabbling in all sorts of music related stuff like recording equipment, studio software, mixing boards, etc. – and making guitars took a backseat to all this. They went from 100% guitar making, 100% of the time, to 25% guitar making, 100% of the time. They gave up, in essence, the thing that made them great in the first place to try and woo more customers. And they did it so quickly that no one really had a chance to adjust. In 2015, Gibson made guitars. In 2018, Gibson made headlines by filing for bankruptcy.

What we can learn #2:
Expansion is great. Growth is wonderful. But make sure you are prepared for it, and take it a step at a time. Oh, and don’t leave behind the things that got you to the point where you CAN grow.

What Gibson did wrong #3:
They claim that the lack of “guitar gods” like Jimi Hendrix and Eric Clapton means that today’s newer players don’t often see or know who is playing and therefore have no true inspiration to draw from. So, no new audience for their signature products.

What we can learn #3:
Firstly, I call BS on Gibson’s excuse that they can’t sell guitars because there are no more idols out there. Country music, jazz, blues, alt/indie rock, folk – all have some pretty big names in the guitar strumming business. Gary Clark, Jr., Ray LaMontagne, Alan Doyle, the new guys in Greta Van Fleet, just to name a few. Gibson, to my knowledge, has never approached or featured any of the non-rock axers on the scene because they seldom looked outside US/UK rock music for inspiration. And, they are STILL selling over 170,000 guitars a year, making roughly $300 million off guitar sales.

So, first thing to learn, I guess – have a broad appeal because your niche can collapse on you or at least not be what it once was.

Secondly, if you DO find your niche isn’t what it used to be, or never was, find or make a new one. There are millions out there who need whatever you and I have to offer. They just don’t know we exist. (Like the 18 yar old I recently met who had never HEARD of a Gibbie, but knew all about Martins…)

Thirdly, we all want to be millionaires, but let’s be reasonable and real here – a decent living not only IS possible in our field, but maybe SHOULD be all we can ask for. You WILL tap out your market’s price range. (I mean really?? $300 mill isn’t ENOUGH??? $2000 for a BASIC model guitar??)

Like Jeff Goldblum’s character in Jurassic Park says, “they were so busy finding out if they COULD, they never stopped to wonder if they SHOULD” or something like that. I see so many new people in the business/digital marketing field that have been promised 6, even 7 figures, for following this or that guru. I see guys upping rates 6 times a year. And I see guys wondering why they can’t sell that 10K website development package to anyone. Keep your wits about you, gang, and business will be better than ever.

You won’t be hitting any sour notes, unlike our friends at Gibson.

Marketing Yourself to Main Street – Tips for Local Marketing

local marketing

A copywriter mentor of mine, Steve Roller of the Copywriter Cafe likes to say that he could be dropped in any city where he knows the language and find enough work to last him 6 months or more. Without internet, without knowing a soul when he arrives. He’d simply use his local marketing skills and find local shops and businesses on the streets around him that need his services.

Local Marketing is Different

Could your business survive without the Web? Could you make a living in a strange town or city? Could you make a living in your OWN home town? Do you know what it takes to market to local business owners?

Local marketing is different from online marketing. There are different ways to approach local businesses than you would use to approach an online prospect, even if USING online marketing to reach your locals. Local marketing is different, too, if you are in the B2B sector, as you will often find that many small local B2B guys simply AREN’T online.

Who Qualifies as “local”?

Now, I’m not talking about franchisees, here, like the Pizza Hut and Tim Horton’s. Or local agents for regional or national companies, like insurance agents and financial advisers. I’m talking about truly local businesses, owned and operated and innovated by folks in your city, town, maybe even neighborhood.

The little guy on the corner with the florist shop. The gal down the street at the cafe’. The auto mechanic who fixes your car. The CPA who does your parent’s taxes. Even a larger biz like the car dealer on the edge of town, and the construction firm that built the new town hall, and the law firm on the 6th, 7th, 8th, AND 9th floors of the bank building, as long as they aren’t a “branch” office of some larger firm, they are “local” and need local marketing.

And there’s no  reason why YOU can’t market your goods and services to them. You just have to know HOW. And it’s NOT how you market to the world at large on the internet. Here’s a few tips to help you market yourself to your own Main Street neighbors, wherever your Main Street might be.

You Need to Approach Local Marketing Differently, Even Online

Online, we have these wonderful things called by various names – free downloads, optin rewards, lead magnets (my personal favorite), lead generators. Their entire purpose is to offer enough value to the prospect to get them to sign up for our email list or subscribe to our blog or try our stuff. And they work beautifully at it, too, when the right mix of offer, audience, and value is achieved.

In the world of local marketing, you need to do two things with your lead magnets. In the online world, you can offer all kinds of stuff – discount coupons, tip sheets, checklists, ebooks, you name it. That typically doesn’t cut it in the local marketing world. Your online folks need a taste  of what you have to offer. Your locals? They want to know what makes you different.

Here’s the scenario: You are trying to break into a market that has been dominated by Hank or Al or Kate up the street. Your local customers KNOW what you’ve got, because they’ve been getting something similar from Hank or Al or Katie all these years. So, your lead magnet should be something that tells them how you are DIFFERENT from the competition. What makes YOUR cleaning service, or tax prep, or muffins better than Hank’s or Al’s or Kate’s? Local marketing needs to focus on your uniqueness, not just on what you’ve got to offer. And yes, that goes for the lead magnet you are giving away on your website and advertising on Facebook.

Local Marketing Requires Offline Efforts

For many of those local B2B guys who can’t be bothered to spend much time online, or have their own online presence, you have to go real old school. Walk in and introduce yourself. Have a business card and brochure or other goodie you can leave behind. Again, make sure it showcases your differences with any local competitors, because chances are, they already have someone to do what you do.

And local marketing, even when done online, still needs that personal touch. The phone call follow up instead of the email. The thank you note when someone signs on to your client stable. The card or gift come Christmas time. They aren’t some anonymous internet account, but your neighbor and fellow business owner. Treat the as such.

Let’s not forget that this IS your community, YOUR home town, whether it’s Manhattan, NY with its millions of people, or Mill Creek, WV with its 700 folks. Local marketing may mean showing up for ball games, school carnivals, litter pickups, and the Lions Club’s spaghetti dinner. You may have to buy cookies from Girl Scout Troop #83 or start getting your morning coffee from the corner diner every day. In short, local marketing is no place for introverts or the anti-social. They are your tribe, like it or not, and they’ll expect you to get involved just as much as they are.

Local Marketing is NO Place for Family, Maybe Not for Friends

It’s one thing to be friendly, even form a friendship, with a local client. But it’s never good to mix business and family. And that can include old friends, too. Local marketing should be part of your business strategy to increase sales and income. Local marketing should be approached with the seriousness of any other business venture. And that means you CAN’T be giving discounts to Cousin Erin or taking time away from clients to work on Uncle Joe’s latest “get rich quick” endeavor. (Or worse yet, endorse his endeavor.)

If your family has a legitimate existing business, or someone close to you could benefit from your goods or services, by all means, work with them. Work for them. Take them on as a client. But treat them as you would ANY OTHER customer or client. No discounts. No special treatment. It cheapens you in many eyes, and makes others question your professionalism. And then there’s the “what if” something goes wrong. If you can’t get your Grandma’s order delivered without a hassle, how in the world can they expect you to handle their business?

And for the love of all that’s good business practices, do NOT use friends and family as prospects for your new endeavor. Unless they are the very definition of your ideal customer or client, stick to marketing to OTHER locals. Your family may buy, or hire, but from the outside, everyone will see that they only did it BECAUSE they are friends and family. You also run the risk of alienating the very people you are closest to, by constantly marketing to them when its obvious they aren’t qualified or interested. Commit your local marketing efforts to the rest of town, please.

Local Marketing Can Pay Off

Like my friend Steve, if you get good enough at marketing locally, you may not NEED an online effort. Or as much of an online effort, to satisfy your business needs. Having a bunch of stable, local clients can also mean more peace of mind. You don’t have to worry about changes in this platform’s terms of service, or increases in that site’s advertising rates. You’ve got Main Street in your pocket. Let the internet howl in rage and tear itself apart! (Isn’t it great to see all those online biz folks get in a flurry and huff every time Google makes an algo change or Facebook decides to update its timeline policies?)

Whether your Main Street is a step away, or a world away, from my door here in small town WV (no, it’s not Mill Creek, they’re twice our size), I can help you with your local marketing efforts. Drop me a question in the comments, or hit me up with an email. We “locals” have to stick together.