Chris Martin IV, Chairman and CEO, C.F. Martin & Co.
A family-run, nearly-185-year-old guitar company has a unique vantage point on the market, and the perspective is even sharper when you’re the company’s sixth-generation leader, whose time steering the ship has produced even greater devotion from loyal brand aficionados. In speaking to Chris Martin IV, Chairman and CEO of C.F. Martin & Co., we had an opportunity to blend historical insights with contemporary trendspotting, all in service of preparing for an unpredictable guitar market of the future. And, to be sure, Martin is optimistic about robust demand for acoustics, even as he sounds cautionary notes about big-box sales, fierce competition and sometimes-onerous international wood regulations.
In this discussion, Martin discusses all of that, as well as the guitar space’s pace of evolution, the state of beginner guitars, whether collectors are buying or selling, and which Martin guitar he prefers to buy.
GAMA: What insights can we glean from C.F. Martin & Co. about anticipating, preparing for and fighting through difficult market conditions?
Chris Martin: My ancestors were able to pivot, and there are a couple of good examples. One is, initially, when C.F. came to the United States, he was making copies of what would be called a Stauffer guitar. And then, relatively quickly, he saw that the demand for traditional, Spanish classic guitars was more robust. And, so, he stopped making the Stauffer style and started to copy the Spanish style. And that created a fair amount of success. Later, my great-grandfather saw the demand for Martin gut-string guitars drop off dramatically. So, that caused him to embrace the steel string on the guitar, which was already available on the mandolin and the banjo. It was actually a blessing that he stopped making gut-string guitars and started making steel-string guitars.
During my dad’s running of the business, he went on an acquisition binge, and only one out of four turned out to be durably successful. That was when he bought Darco strings from the D’Addarios. The other three acquisitions didn’t work. It helped me learn that our industry is very niche-y. If you’ve got a niche, my feeling is, work it hard!
GAMA: During your tenure leading the company, what was one of C.F. Martin & Co.’s greatest challenges? How did you overcome it?
Martin: I happened to join the business formally right around the time the acoustic boom busted. Concurrently, there was an ever-so-slight loss of focus on making the best guitar. So, I said to my colleagues, “Not that many years ago, we made 23,000 guitars. This year, we’re struggling to sell 3,000. Let’s make them the best 3,000 guitars we’ve ever made.” And that resonated with my colleagues. So, we cleaned up our act around little, niggling quality issues that were not appropriate for the Martin guitar. And then, I got lucky, when MTV’s “Unplugged” happened. But, with the resurgence of interest, we were prepared to make more great guitars. Had we not been ready, we might have made more not-so-great guitars, which wouldn’t have been good for our reputation.
GAMA: What is the pace of innovation in the guitar segment?
Martin: I don’t think it ever evolves quickly, but people try stuff, and I love it. I would go to Frankfurt and see some wild, crazy idea for a new electric guitar. I’d engage the principal, who’d be wide-eyed and saying, “I came up with this design and people think it’s great!” And I’d say, “Yeah, man! You’re onto something.” And then, a year later, they’re gone.
I think both customers and end users are conservative. It takes a while for them to move off the traditional instruments they know and love. And, more often than not, I think they don’t—they don’t embrace too much change.
GAMA: What’s currently shaping sales trends in the new-guitar market?
Martin: When you talk to people in the electric-guitar market, they’re like, “Man, we need another guitar god.” With acoustics, it isn’t so much that. You’re going to make it up in numbers, even if you’re not hearing acoustics on the Top 40. There’s still a lot of acoustic music being made and a lot being played. It might not be supercharging the market, but there’s still a great deal of interest in taking a wooden box, holding it against your body and making music out of it.
GAMA: What are your thoughts about higher-end new guitars versus mid-priced and entry-level ones?
Martin: Your first guitar’s probably not going to be a Martin. Maybe your second. Certainly your third. But, if you go to a music store, the quality of the entry-level product is higher than it’s ever been. And that makes me feel good, because my biggest concern is the beginner. In my opinion, guitar-shaped objects sold at big-box stores are kind of like a flip of the coin. It’s not their core business. Yes, they have guitar-shaped objects for sale, but you never know. They might be OK. But, if they aren’t, the chances of losing that beginner are very high. If you go to a music store, however, the retailer will stand behind their product.
Given where the stock market is right now, there’s also a wealth effect. We’re seeing pretty robust interest in very expensive guitars. But when you look at, say, the product we make in Navojoa, Mexico, we now have a lot more competition than we do for the products from Nazareth. Down there, it gets scrappier. The volume’s there, but it’s more challenging for a manufacturer like us, because we’re not a cheap date. To give the kind of dealer and end-user support that we do, it’s expensive.
GAMA: Let’s turn to the resale market. What are your observations there?
Martin: George Gruhn made an interesting comment. He’s seeing older collectors now beginning to liquidate. So, there’s more product on the market. Here’s a cautionary note about that: Back when classified ads were a thing in the newspaper, I saw a local ad for a 000-18 Martin guitar. I rushed right over, looked at the guitar and made a deal. I thought, “Man, good deal!” I came back to work on Monday, and I brought it in to customer service. They said, “Yup…this isn’t a bad guitar. It’ll be much better after we reset the neck.” Now, here I was a young, naïve Mr. Martin, who had just bought a used guitar that required several hundred dollars’ worth of work. So, my caution to the end user is, “Hey, are you sure you know what you’re buying?”
This is where dealers have to remind customers, “If you buy a used guitar from me, I’ll stand behind it. You may not get the manufacturer’s warranty, but, as a reseller, I want you to get a good product.”
GAMA: How has the trend toward more stringent international trade restrictions on wood species affected your business?
Martin: With CITES, everything happened so abruptly. And what’s really disappointing is that that organization only meets once every three years. So, even though it appears that we’re having a dialogue with them to communicate how disruptive this was, and how it was really an unintended consequence for musical instruments—when they were actually going after furniture—the best they can do is say, “We hear you, and we’ll reconsider musical instruments when we meet again in three years.” It’s like, really? So, whatever we’re doing, we have to keep doing it for another two years, and then we might not have to do it again after that. It’s just crazy. So, I’m not a happy camper, to be honest with you.
GAMA: Is there a Martin Guitar that’s your favorite?
Martin: I pick the wood for the guitars that I buy, and I just love pearly guitars. In general, when the customer buys a 42 or a 45, they’re already getting the best wood we have, augmented with some beautiful pearl inlay. So, it’s like a twofer—you’re getting the best wood, and you’re getting as much pearl inlay as you can afford. And, so, when I buy a guitar, I very often buy a Style 45.