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Gibson pursued a diversification strategy as a “music lifestyle” brand, pivoting unsuccessfully into the home entertainment and audio-equipment industries. The company has announced it will liquidate its consumer-electronics business while restructuring its business to focus on its musical instruments.
“They are an iconic American brand but the people who ran the company got greedy and started doing things that weren’t what got them there. The problem wasn’t people not buying enough guitars; it was the way they were running their business,” (Stevie Salas)
(and the reason I'm posting this here in the Lounge is that it's a follow-up to a post made here, I guess about a week ago.)
Much the same happened in the UK some years ago, to General Electric, run by Arnold Weinstock[^]. A successful company that made money by sticking to its core business and not throwing money away on mad projects. Once it got taken over by "people who understood modern business" it lost value and credibility very quickly.
Personally I think they diversified too quickly. The jump from guitars to home entertainment is just too large.
What they should have done is gone, is going, or in the direction of other instruments or in the amplification realm (like Fender) or into pedals and effects.
From amplification to sound systems is not a too huge step and from that they could jump to their home entertainment business desire. (I'm talking at least 2 decades here)
But that's just my opinion. They'll probably sell of most or all of their side businesses and will have to find a new invester for the instrument making part. Now I need to check my bank account if I have enough money
These seem to be the opinions of musicians who while they have a genuine interest in Gibson are not business people. The worldwide sales of Gibson and Fender guitars are under pressure from cheaper alternatives (often unashamed copies). The actions of the executives could have been genuine albeit misguided measures to bolster the company and save the brand. No company can rest on it's laurels, it is either growing or declining. Gibson appears to have some good chance of survival but many iconic brands have succumbed. This is often due to unfair competition in the form of blatant theft of intellectual property.
"The whole problem with the world is that fools and fanatics are always so certain of themselves, and wiser people so full of doubts." - Bertrand Russell
modified 8-May-18 6:20am.
Last Visit: 21-Feb-20 9:21 Last Update: 21-Feb-20 9:21