Sunday, November 13, 2011

Daddy's Junky Music Closes--An Object Lesson For Us All

Daddy's Junky Music, a New Hampshire icon since 1966, recently closed its doors for good. To hear Daddy's owner, Fred Bramante, tell it, they were unable to overcome a poor economy but, even more importantly, they could not overcome their internet competition and the lack of sales taxes charged by many internet businesses. A costly labor dispute also contributed to Daddy's insolvency. Troy Richardson of LA Guitar Examiner has a particularly insightful article that closely scrutinizes and dissects Daddy's explanations of their demise:

In order to survive, every business needs four things-- products people want at reasonable prices, a means of letting people know what they offer, convenient shopping methods,
and service that makes the customer feel valued after the sale. At the heart of those parameters is the need to be able to adapt to a constantly changing business environment and mastery of the newest business tools.

Richardson describes a business that failed to keep up with its p
roduct line, offering a narrower and narrower range of mediocre products over the years, both new and used. Says Richardson, "The product lines left weren’t supported with any depth. With only mid-level product offerings at best, the quality of used gear coming in spiraled down to where most musicians were hard pressed to find anything worth owning."

Customer service lies at the heart of every successful business, and the quality of customer service is a direct function of a business's employees, their own sense of v
alue and their pride in the products they are pushing. Staff turnover is a significant indicator of employee morale and Daddy's had a problem. Again, Richardson offer the following: "Reviews on show post after post by unhappy customers encouraging others to shop elsewhere, with only the most glowing reports coming in at three stars and stating 'it wasn’t that bad.' While there were a few die-hard employees there for years, the company retained few others, having turnover that rivaled the big chain stores they were trying to beat. Many industry professionals got their start at Daddy’s, only to move on to work for manufacturers, rep firms or, unfortunately, the competition."

Daddy's claims internet competition undermined their success,
especially the absence of an internet sales tax, but Daddy's had several opportunities to capitalize on the internet as a business tool. Successful businesses try and tweak, try and tweak, until they find what works. Daddy's apparently skipped the tweak part, tried and abandoned online selling strategies on more than one occasion. Richardson lays out a time line that put Daddy's at the forefront of the internet commerce revolution, and certainly at the vanguard of the brick-and-mortar alternatives, that they simply failed to capitalize on. Used Gear by Mail,, and Daddysonline all had promising platforms but, rather than fine tuning, it seems Daddy's simply abandoned them. Observes Richardson, "Possibly too little too late, never seemed to get the push the other web-based programs received and faded away with the rest of the business."

It is profoundly significant that in 2008, Daddy's settled a l
abor dispute involving two employees and a manager for between $600,000 and $700,000, a not insubstantial sum. Said Bramante in an interview with Jake O'Donnell of Exeter Patch, "I didn't want anyone to think they'd been cheated... It cleared my conscience." It also probably cleared out most of the bank account. Entering a recession with cash reserves so seriously depleted was probably the final, though not the only, nail in the coffin for Daddy's.

On the surface, Daddy's was a business that succumbed to the vagaries of the economy and changing ecommerce technology. But, a little digging suggests a business that survived in spite of itself until it couldn't anymore. Bramante is quoted as saying, "It's a miracle we got this far... Ultimately, this didn't need to happen." No, no, it didn't. It didn't need to happen.

So, what is the object lesson for us? I sell guitar straps. Odds are, you sell your music. We are all bound by the same requirements for success-- a product people want at a reasonable price, an effective means of spreading information about our product, customers and fans who feel appreciated, and using the latest available technology to make that product available for purchase. It doesn't matter what you sell. The rules are the same. Learn from Daddy's.

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