Market Analysis for the E-Guitar Market

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  • Topic: Gibson Les Paul, Gibson Guitar Corporation, Electric guitar
  • Pages : 2 (638 words )
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  • Published : November 20, 2012
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Market Analysis and Low-Price-Segments
The global market for music instruments covers about $16,8 billion. As there are no reliable sources on worldwide sales data for guitars, the U.S. market shall be examined exemplarily. Table 1 shows the development of units sold, retails, and the average prices over the last ten years. It can be observed that there is a growth of nearly 275% in units sold, and about 160% in retail, whereat the average price decreased by 57%. According to this there is a strong tendency for low price products. Year| Units Sold| Retail| Average Price|

2010| 2,991,260| $1,151,290,000| $372|
2009| 3,302,670| $1,158,592,050| $350|
2008| 3,201,220| $1,022,861,000| $309|
2007| 2,341,551| $903,261,000| $386|
2006| 1,942,625| $921,057,000| $529|
2005| 1,742,498| $922,280,000| $529|
2004| 1,648,595| $923,522,000| $560|
2003| 1,337,347| $762,185,000| $569|
2002| 1,153,915| $694,883,000| $579|
2001| 1,090,329 | $710,769,000| $652|

In table 2 this tendency appears very obviously. In the low price segment, that is prices below $500, are about two third of the whole market volume. Comparing acoustic and electric guitars it can be observed that there is a stronger request for high prize electrics than acoustics. | Units Sold| Units Sold|

Type |  Acoustics| Electrics|
Under $100 | 390,028 | 256,354|
$101 to $200 | 410,030 | 561,537 |
$201 to $350 | 110,008 | 195,317 |
$351 to $500 | 40,003 | 97,659|
$501 to $1,000 | 40,003 | 61,037 |
$1,001 to $1,500 | 10,001 | 24,415 |
Over $1,5o1| 20,001 | 36,621|
Total| 1,490,260| 1,501,000|

Also it turns out that high quality guitars as Gibson’s or Paul Reed Smith’s, which are presented in this paper, are prestige goods with an inverse price-demand relationship. That is higher prices are associated with higher quality. Gibson’s former attempt to join the low price segment in order to compete with...
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