Something I don't understand about the Gibson company

Discussion in 'Guitars in General' started by rjpilot, Nov 13, 2019.

  1. rjpilot

    rjpilot Member

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    ...

    Ok Ellipse tax paid

    This applies to Fender Musical Instruments also.

    Why purchase and take over leadership of a bunch of other companies like Kramer, Jackson, Charvel, etc. and sell them under their original name? To simply eliminate competition ok. But why keep up the charade.. Why not make a Gibson branded Kramer Pacer (if you will). I liked Kramers in the '80s but I wouldnt mind if the name Gibson was on the Headstock. Craft beer is going through the same kind of craziness but I think most craft beer snobs would turn their nose to Budweiser Double IPA named Space Dust, hence the brand "Elysian" remains. But to me guitars are a different animal. Am I wrong? I have a "Spirit by Steniberger" by Gibson. WTF. Gibson has probably paid to use the name "Steinberger" and i suppose initially that might be a way to smooth the transition but after a few years, why keep calling it a Spirit by Steinberger made by Gibson. I don't know what I'm talking about. Just thinking out loud.
     
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  2. fjrabon

    fjrabon Member

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    It’s mostly just to streamline distribution and reduce production redundancies.
    Usually when they buy another guitar company they buy a defunct or nearly defunct brand because they know they can revive the brand easily and that their production costs are lower than the former owners, mostly due to economies of scale.
     
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  3. Declassified

    Declassified Member

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    The answer is most likely heritage and tradition. The same reason why epiphones aren't branded Gibson and Squires aren't branded fenders. They don't want to "weaken" the brand. Same reason why Rolex produced Tudor for a lower budget option.

    Smart consumers see right through this. But in Boardroom and Marketing departments apparently you can't weaken your "strong" heritage brand by producing lower cost models, or even introducing a new guitar from another manufacturer under a new name. We know its bunk. but well, who knows.
     
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  4. Jim85IROC

    Jim85IROC Member

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    it's not at all uncommon for companies who buy other brands to keep that brand more or less intact, but utilize methods to make both brands more efficient, and therefore more profitable. This may include combining manufacturing facilities, combining distribution channels, and combining other business areas in order to increase overall efficiency and minimize unnecessary overlap, while still providing the separate product line. Even if Fender was to acquire Gibson, I'd still expect my Les Paul to say Gibson on it, even if FMIC was leveraging their existing business channels to build and distribute that guitar.
     
  5. Oldschool59

    Oldschool59 Member

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    It's called branding & marketing. Segmenting the market to cover all bases. Cheers.
     
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  6. GreenKnight18

    GreenKnight18 Member

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    Nike owns Converse, Adidas owns Reebok. I still like the look of Converse Chucks (and One-Stars, and a few others, but this isn't The Sneaker Page...).
    Why would guitar buyers be any different? Jacksons and Gretsches have that special look, and while there are a number of TGP people that claim to only care about tone and not the looks-- that's bs-- Playing a cool-looking guitar is awesome (or... being 'that guy' playing the ugly guitar all great is awesome too-- you're still trying to be cool by not trying to be cool).
     
    Last edited: Nov 13, 2019
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  7. Guitarworks

    Guitarworks Member

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    You mean to say there's only one thing you find confounding about Gibson?! Ok, jokes aside, Gibson paid for the name, so they're going to use it, quite simply. That was the first answer that came to me. Name ownership bears rights, privs, and brand recognition . A company purchases those rights, privs, and brand recognition to use in pursuit of some sort of strategic or tactical advantage in the market.
     
  8. Magnets And Melodies

    Magnets And Melodies Member

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    There's very few things in life that you can buy today that isn't somehow owned by big business. The only way to avoid it is to shop local or support small builders you know are independent. The unfortunate thing is that shopping local/independent usually comes with a high luxury price tag, so many people simply can't. I'll be honest, I've been tempted to trade in my Gibson's for a couple Bartlett guitars, but without have any nearby to play first it's a tough sell.

    Realistically there's not much different between buying a Kramer owned by Kramer VS a Kramer owned by Gibson. It's not like the guys on the Nashville assembly line are building the Kramers. It's all seperated. The only different is who all the money funnels up to. I believe other posters more accurately depicted why these things happen... it's not so much about creating an illusion of competition - it's more about covering all ground and profiting from multiple demographics of buyers.
     
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  9. rjpilot

    rjpilot Member

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    Yeah Marketing sure but it also seems to cause the main brand to flounder. I enjoyed some of the Floyded Gibson superstrats of the mid 80s. Now they don’t need to produce that because they have Kramer or what have you. It seems like it stifles the creativity of the big(ger) brand. Like I said just thinking out loud. Btw I’m not a Gibson hater.
     
  10. fjrabon

    fjrabon Member

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    Eh, what stifles innovation at Gibson is simply their customer base. Gibson customers don’t want innovation from Gibson. They just want well made versions of the designs they were selling between 1952 and 1961.

    Those guitars you liked... mostly get made fun of now and are often cited as reasons Gibson nearly collapsed in the late 70s/early 80s.
     
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  11. Oldschool59

    Oldschool59 Member

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    Absolutely not. One brand has nothing to do with another, even under the same umbrella of companies. Very often, they are separate operations, with separate designers, manufacturing facilities, etc... Buying Kramer will have an absolute net impact of zero on the other Gibson brands. It will just bring in more revenue from a different segment. When deciding to buy a brand, the Business Dev & M&A folks look primarily for revenue streams that don't cannibalize (or minimally so) the existing portfolio.
     
  12. wox

    wox Supporting Member

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    Why are there Taco Bell, KFC and Pizza Hut? Why not just have a big "Food Restaurant"?

    Why are there Tide, Olay, Gilette, Pantene, Gain, and Old Spice? Why not have a single "Personal Hygiene" brand?

    Why does Nissan make Infiniti cars? Why does Honda make the Acura brand? Why aren't Porsches just very expensive VW cars?

    Brands have equity, brands have history, brands have affinity, brands have personality, brands distinguish products, different brands appeal to different people, people like brands.
     
  13. fjrabon

    fjrabon Member

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    One interesting example of this is a case that went the opposite direction. In Japan, they don’t have the same idea of “Low end brands” and “high end brands” like we do. It exists to some extent but nothing like what we have in the US. A few very large corporations make up nearly the entirety of Japan’s economy.

    for years Toyota has built luxury automobiles, but they always had a difficult time selling them in the US, since US consumers could only see Toyota as a well made, but utilitarian brand.

    so... they essentially created Lexus out of thin air. A Lexus in Japan is simply a Toyota. In Japan consumers have no problem accepting that the same company can put out an economy car and a luxury car.

    But for the American audience they had to create a luxury brand for us to accept it. And boy did we ever. Literally by just changing the brand name, that’s it, that was the only change, Toyota went from a complete non-player in the US luxury car market, to a dominant figure. Same thing is true of Honda and Acura. Although they do tend to now sell Acuras in Asia, the brand was originally created because Americans just couldn’t accept a luxury Honda.
     
    Last edited: Nov 13, 2019
  14. Jabby92

    Jabby92 Member

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    I think as well that a lot of it just makes more sense this way. If I'm buying a Gibson today, I'll know and expect to see guitars like the Les Paul, SG or ES-335. But it would be weird (IMO) to go into a Gibson showroom (as in, only Gibson branded) and seeing 80s style Kramer Superstrats or similar guitars on display along side these older vintage designs. Now if it had its own Kramer section in the Gibson room, I'd be okay with that, but to see the Gibson name on all those guitars would sort of just throw me off or confuse me I think.

    On the other hand, if all those guitars under Kramer or another brand were originally all under Gibson.. maybe I'd see it different.. but overall I think brands make sense to distinguish all this stuff and help streamline things further.
     
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  15. cwlivingston

    cwlivingston Member

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    Branding. They believe that the brand they bought is more valuable if left as-is. They are probably correct. Every industry does this.
     
  16. fjrabon

    fjrabon Member

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    ha, as recently as last year Gibson was market testing a super strat with a Firebird headstock. I played one at one of their market testing event things. It was good, but nothing I’d be excited about. I also tried a prototype ES235 that day, that they did end up making and bringing to market, with a couple of final minor cosmetic changes.
    And a few years ago they did that modern double cut Les Paul Custom that was more or less a super strat. It didn’t sell well at all. Gibson always seems enamored with doing their version of a super strat, and it always flops.
     
  17. Magnets And Melodies

    Magnets And Melodies Member

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    Yeah that would be a big no no. They would just dilute their brand. They want people to associate Gibson with LP's, SG's, 335's etc... they don't want to dilute it and have people stop thinking about their heritage and start thinking about super strats.
     
    Last edited: Nov 13, 2019
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  18. chrisjnyc

    chrisjnyc Supporting Member

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    Gibson made the "Victory" back in the 80's and no one bought it... Kramer still has a lot of fans. Why would you throw away all the brand equity just to put your name on the headstock.
     
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  19. fjrabon

    fjrabon Member

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  20. mc5nrg

    mc5nrg Member

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    Gibson bought Sberger and killed the USA production after some time passed.
     

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