DOING WHAT BIG STORES CAN'T DO.

At Cotten Music, They Don't "Sell" Guitars, They "Match" Players With The Perfect Instrument

"The nifty thing is that every guitar is different. Even if you have five guitars of the same model and make, maybe only one will really speak to a player," declared Kim Sherman, one of the proprietors of Cotten Music in Nashville. "This allows every store to offer something different, and it gives small retailers a place in the market." In the face of stepped-up competition from newly opened MARS and Sam Ash Music locations in town, Sherman and her partner, Darci Cotten, have relied on the character of unique guitars and a highly personalized selling style to stake out their market niche.

Nestled in a small retail strip that borders Vanderbilt University, Cotten Music has a down-home, welcoming atmosphere. Gleaming acoustic guitars hang from the walls and ceiling of the long, narrow space, and studios in the rear of the store allow players to try out different guitars in private. Everyone who crosses the threshold gets an immediate greeting, and Darci and Kim delight in discussing guitars all day long. They don't even consider what they do as "selling;" they prefer to think of it as helping players find the guitar that's perfect for them.

This neighborhood music store atmosphere belies cutting-edge sophistication; Cotten Music maintains one of the more effective Web sites in the industry -- www.cottenmusic.com -- and has developed a loyal band of customers all over the globe. Sherman declined to reveal just how much of the business is conducted online, but she did say, "The Internet is very important to us."

Cotten Music was founded by Richard Cotten in 1961. As a student at Vanderbilt University, he spent so much of his free time at Hank Snow's music store in Nashville, they finally offered him a job giving guitar lessons. His talents as both a jazz guitarist and teacher earned him large and devoted student base. Even though he had majored in math and physics, his sole career ambition upon graduating was to operate his own music store.

Over a three-decade period the store continually evolved to reflect the changing nature of the industry. In addition to guitars, at various times Cotten Music also stocked drums, band instruments, and keyboards. Richard died after a six-month struggle with leukemia in 1995, and the challenge of maintaining the business fell to his widow, Darci. "Richard's life revolved around Cotten Music. I felt I just had to keep it going," she explained.

Over the years, having purchased almost all her guitars from Cotten Music, Kim Sherman had become a personal friend of Darci and Richard. After Richard's death Darci turned to Kim for both friendship and counsel in running the business. As the two discussed the fine points of various guitar lines, it occurred to Darci that Kim would make an ideal partner. "Kim was like family to me, and she had such an amazing knowledge of guitars, so I went to her in March of 1996 and asked her if she would join Cotten Music," explained Darci. "I'm thankful she said yes."

Two Kinds Of Customer

An accomplished guitarist and singer, Kim brought a unique perspective to music retailing. After struggling as a professional musician in the '80s ("It was tough being an acoustic musician in the age of synthesizers," she said), she went to work for Ingram, the country's leading book distributor. During her nine years in the book industry, she experienced first hand the impact that national chains like Barnes & Noble and Borders had on independent booksellers. "When I came to Cotten, I felt the music business was about two years behind the book business and that big-box chains were inevitable," she said. Rather than panic at the prospect of aggressive new competitors, she and Darci prepared for the inevitable, shedding product lines to concentrate exclusively on acoustic guitars and accessories. Simultaneously, they reached out beyond the Nashville market with a Web-site presence.

Kim divides Cotten's core customers into two basic groups. "A large number of customers are professionals who don't make their living with music but find enjoyment in playing and purchasing guitars," she explained. "Because Nashville is a town of working musicians, we also deal with musicians who struggle to come up with the money to buy a good instrument that will help them further their careers, as well as very successful professionals."

Buying guitars is a never-ending process for most die-hard enthusiasts. As a result, Cotten Music relies heavily on repeat business. In a common transaction, customers regularly place an old guitar on consignment to free up the cash to buy a new instrument. "We love these transactions because it allows us to offer great instruments to customers at affordable prices, and it helps us sell new guitars," said Kim.

Professional and amateur musicians alike frequent Cotten Music because it is a tranquil haven for sampling a wide array of guitars. Every guitar on display is perfectly set up, and guitar technicians cheerfully adjust instruments to suit the preferences of the customer. Darci explained the appeal: "Players will spend a long time searching for the perfect guitar. We try to make the search as pleasant as possible."

Darci and Kim try to create the same experience for online customers. "Online transactions usually start with a brief query about an instrument," Kim said, "but as the correspondence goes back and forth, you get a feel for the customer, and you develop a level of trust. We never went online because we wanted to sell thousands of units cheaply; we did it so we could present our brand of service to a much larger audience."

Ironically, while Kim and Darci devoted substantial time and effort preparing for the onslaught of national chains, they both contend that the Internet has had a far greater impact on their business. "When we set up our Web site in 1996, there were only a handful of music stores online," said Kim. "Now most stores I know are online, and people I've never heard of pop up every day with instruments to sell."

Cotten Music's core customer group has also taken to visiting chat rooms and various Web sites as their primary source information on guitars. "The Internet is like the Yellow Pages of the '90s, only more so," Kim added. "That's where our customers turn first, and one of the things they find out online is what other guitar enthusiasts think about different manufacturers and retailers. One unhappy customer can have a big impact."

So how does a small shop compete in a wired world?. Darci and Kim concede that it is a major challenge; however, for Cotten Music the key to success lies in the decidedly low-tech process of cultivating personal relationships. Despite a regular advertising presence in Acoustic Guitar Magazine, the Nashville Scene, and several Nashville Public Radio shows, plus links with scores of other Web sites, the company's biggest source of new customers remains referrals. "Wheth-er it's online or local customers, most people come to us because of the recommendation of a friend," explained Kim. "It's the greatest compliment we can get.

RELATED ARTICLE: Books Versus Guitars

Over the past decade, a major expansion drive by Barnes & Noble and Borders Books has pushed independent booksellers to the wall. Several high-profile lawsuits filed by the American Booksellers Association detail just how the national chains have used their clout to extract better terms from publishers and undercut local dealers. As a sales representative for Ingram Company, the nation's largest book wholesaler, Kim Sherman observed this wrenching industry consolidation first hand. Is there a parallel in the music industry? She says "maybe, maybe not."

"A book is just a stack of paper between two pieces of cardboard. It is the ultimate commodity," she explains. "Whether you buy it from the local store or Barnes & Noble, the final experience is the same. Guitars are living, breathing things. Outwardly, they're all boxes of wood with wire strings. But to a player, each one is different. The guitar that's right for you may not be the one that's right for me. So, stores with the same brands don't necessarily have the same inventory.

"There's a service and trust factor to guitars as well. Books are an impulse buy. Buying a guitar that costs over $1,000 is a lot more involved than picking up the latest best seller. The guitar has to be presented properly, and the customer has to have enough time and space to get to know it. A small store that develops the trust of the customer and provides the right buying experience can survive against larger competitors. Price is important, but it's not the only way to compete in guitars."