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Rock ‘N’ Roll Retail On The Sunset Strip

Amoeba Music

Digital? Not a threat to some people in the analog world. Marc Weinstein, co-founder of the world famous Amoeba Music, is a music lover who has cracked the code to keeping people coming into the physical store: offer a differentiated product and experience that cannot be found online.

“I’m not gonna have to talk about credit card processing, am I?”

It would appear that, to Marc Weinstein, cofounder of Amoeba Music, PYMNTS’ reputation had preceded itself. (That, and he was told flat-out what the website was.)

No, we were not actually there to talk about credit card processing. Rather, within the reverberant space of the record store chain’s Hollywood, Los Angeles, CA location, we were there to get to the bottom of perhaps the most puzzling contradiction of all that the store — the chain itself, by its very existence — presents:

How can a retail store whose bread-and-butter product is tactile media — we’re talking vinyl LPs and compact discs, two mediums considered long dead by the average consumer, if he can think to consider them at all — not only survive in the era of digitized entertainment but thrive? Because it’s not good vibrations that are keeping the lights on here in Los Angeles, or up in San Francisco, or Berkeley; it’s money, just like the case for any other business.

The Virgin Megastore on Sunset — which tried and failed to compensate for flagging CD sales — has been no more since 2007; the year before that, Tower Records — once a veritable L.A. institution, a few miles west from where Amoeba stands on Sunset — was unceremoniously shuttered.

Those chains were no small potatoes, and they both, at their respective peaks, certainly boasted a lot more locations nationwide (and beyond, in Virgin’s case) than Amoeba’s comparatively meager three across two regions in the same state. But while the Tower Records on Sunset, despite the best efforts of the Los Angeles citizenry, couldn’t even gain historic landmark status after it closed, the Amoeba store in L.A. was deemed to have “instantly [become] a Hollywood landmark” upon its opening in November 2001.

It’s not that Weinstein or his partner Dave Prinz set out to achieve such lofty accolades when they cofounded Amoeba in Berkeley in 1990. As Weinstein tells us, to track the origins of what would unwittingly become Amoeba’s formula for success, we have to go back further — to 1975, when Weinstein landed his first job out of high school, which would technically end up being the only one he’s ever had: working at a record store.

Far from the bustling and culturally varied locales of Los Angeles or the Bay Area, that store was in Buffalo, New York. But, as the teenaged Weinstein had already developed an inkling of as a consumer of tactile music media, a record store that provided an immersive experience — one with knowledgeable staff, a comprehensive library of product and an openness for free-flowing communication with its customers — could transcend its geographical location, becoming a destination in its own right.

That’s the kind of store that Weinstein found in his hometown, and that’s the kind of experience he would set himself on a path to recreate, once he had moved to California in 1980.

A self-described “music maniac” (he’s also a drummer), Weinstein, who is steeped in record store culture and history, refers to the people who are a part of it as his “favorite kind of people.”

“All I ever wanted to do,” he says today, “was be around records and music.”

Ten years after Weinstein’s arrival in the Golden State, he and Prinz had Amoeba Music up and running on Telegraph Avenue. Seven years after that, in 1997, the partners opened their “much bigger” store in San Francisco. Housed in a converted bowling alley, the Haight Street location covered 26,000 square feet — an impressive spread for an independent retail shop.

It wasn’t long until the City of Angels came calling — almost literally.

“It was never our plan to expand outside of the Bay Area — or even to San Francisco, for that matter,” says Weinstein. “But the business just kind of dictated that we do that.”

The business strategy came in the form of repeat customers to the San Francisco store from Los Angeles. After enough beckoning on their part for Weinstein and Prinz to expand to Southern California, the Amoeba cofounders began to seriously explore the option.

“We realized that there was a big void in the [Los Angeles record store] market,” Weinstein recalls, “considering it’s such a giant music town. There was Tower and Virgin” — the big stores — “and then there were a lot of really small stores … and nothing in between.”

By 2001, Amoeba Music had filled that void with its Sunset Boulevard location.

It’s that location where Weinstein sits today, almost 15 years later, while the former retail music power players of Los Angeles — Tower and Virgin — have fallen (along with the smaller stores, whose numbers have shrunk from “a lot” to practically none).

The Amoeba cofounder says that his store was able to outlast the big boys because “our model is completely different from theirs.”

“As big as we are,” he explains, “we have a much, much deeper inventory — partly because [it is about] 50 [percent] used product. The used product is really what makes our store much more interesting than … any of those chain stores could have ever been, because they could never get that many titles in stock.”

The fact that Amoeba Music stands (in three places, no less) while so many other brick-and-mortar retail music stores have gone by the wayside is objectively an impressive feat in and of itself. But Amoeba is now alone, more or less, in fighting a much greater battle: a fight for its very life, it would seem, against the ubiquitous product that is digital music.

Sanguine about the consumer experience that he and Prinz have cultivated, Weinstein does not perceive any competition with electronic commerce as one of mortal conflict.

“Record shopping in general — there’s just something so wonderfully old school and analog about the whole experience,” he remarks. “There’s serendipity everywhere you turn. You don’t really have that online or in the digital world.”

“Some [algorithm] might’ve fed something to you that you think is interesting because of all the patterns they’ve identified that might get you interested,” says Weinstein of the online music space, “but it’s a whole different thing [from] going into a record store and just sort of looking over and saying, ‘Oh, wow, that looks interesting;’ ‘That looks cool;’ ‘Oh, I’ve heard about that;’ ‘That reminds me — someone told me about this, or that.’”

“It’s real-life experience that so [deeply] contrasts … anything you can really do online.”

That being said, Amoeba Music has not turned a blind eye to the opportunities afforded by omnichannel commerce. The company does “quite a bit of mail-order” business, notes Weinstein, and it does operate a digital store — but even in that regard, the brand plays to its strengths.

“Our digital store is mostly all independent stuff that may be hard to find otherwise,” explains the company cofounder, pragmatically observing that “there’s no point in trying to be a mainstream [digital] store and go up against iTunes.”

From a product perspective, then, Amoeba’s means of differentiating itself in the retail space is to embrace the very uniqueness of trafficking in analog (along with music on vinyl as well as CDs, the stores also sell movies on DVD and Blu-ray, in addition to general merchandise such as t-shirts, posters and collectibles), a business strategy that Weinstein says is reciprocated by the customers.

“We feel like there’s constantly … a whole new generation of people who [have] never experienced the analog era … [when] things were made with a certain degree of care and quality that is almost unheard of today.”

Part of the attraction offered by Amoeba, attests Weinstein, is that “there’s so much ephemera in this store. LPs were made to be thrown away, literally; they were made to be used and [then] thrown out in the garbage.”

Weinstein has observed that “for a kid to be able to come in here and pick up a Doors record and see Jim Morrison’s face on an original LP record, [and buy it] for like six bucks, that’s a hit that [is] going on all day at this store.”

“That’s what we really offer, as much as the product: It’s the experience. There’s nowhere else you can go and have the experience you have here.”

It’s that unique experience, says Weinstein, that plays a large role in building customer loyalty.

About the Los Angeles location, he remarks, “Anyone who comes from another city already knows we’re here, and they’re coming our way. We have a lot of tourists that come here,” with Amoeba’s reputation throughout the U.S. — and the world — having put visiting it at the top of many to-do lists.

“I know,” says Weinstein, “just anecdotally from a lot of my friends back east and [in] the Midwest, they come out here and … it makes them feel at home, like they used to feel when they used to walk into their own big record stores, which are now all gone. There’s a nostalgia trip that I think we fulfill in a big way.”

As for the L.A.-based regular customers, Weinstein describes them as covering the spectrum of demographics and shopping patterns.

“There’s a lot of people who collect dollar records; they come in here every day to see what new one-dollar records we have. There are guys who walk in once a month and find something on the wall for $500 and walk out with that…and [there’s] everything in between.”

Additionally, says Weinstein, “there’s families that come in here, and they all spread out and Dad says, ‘You’ve got $10 to spend,’ and they can actually find a bunch of stuff for 10 bucks. There aren’t that many stores you can do that in.”

Amoeba is able to thrive because its customers thrive in a communal experience of discovery. And the twice-a-week, in-store live performances by artists promoting new releases certainly don’t hurt consumer traffic — especially not when Paul McCartney offered up a show, performing an hour and a half of Beatles music on the Amoeba stage.

“That was like seven years ago,” recalls Weinstein fondly, “but still like the greatest day of all of our lives.”

Opening a store in Los Angeles has long since proven to be a successful move for Amoeba Music, but Weinstein — who says the company has gotten some “great offers” from New York and Chicago — has no immediate plans for further expansion.

He, Prinz and a couple of other partial owners (who work as managers at the individual locations) already travel between the three existing Amoeba stores every other week or so; adding New York to that cycle, remarks Weinstein, “would kill us.”

For the foreseeable future, then, Weinstein and Prinz will continue to focus on their three existing retail stores, tending to the business model that has brought them unlikely success for nearly 25 years in all: making Amoeba a “complete destination” for customers who share Weinstein’s lifelong passion for music and records.

Waxing philosophical on the central interest of his life, one that — almost entirely unintentionally, at least in the beginning — paved the way for remarkable retail success, Weinstein remarks, “I think [music] represents an aspect of human endeavor that is undervalued; I think it has a lot of potential to help humanity out in ways that we haven’t even … begun to figure out.”

Having applied that passion and depth of thought to figuring out how to keep bringing customers back to an analog store in a digital world — by offering a differentiation of product and an experience that simply cannot be found online — Weinstein might just have a shot at answering that last question, too.

 

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Exclusive PYMNTS Study: 

The Future Of Unattended Retail Report: Vending As The New Contextual Commerce, a PYMNTS and USA Technologies collaboration, details the findings from a survey of 2,325 U.S. consumers about their experiences with shopping via unattended retail channels and their interest in using them going forward.

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