Headed South By Southwest: ‘Weirdness’ and Enthusiasm for the Arts Drive Prosperity in Austin, Texas

Standing on 6th Street in Austin in the middle of March, it’s easy to see why Austin is one of the biggest – and perhaps most underrated – music cities in the world. In the hub of music, movies, and tech festival South by Southwest, the street overflows with live music pouring from bars’ and restaurants’ open windows. And that’s just the tip of the musical iceberg. The fact that there’s a stage at the Austin airport truly says it all.

As one of the major cultural meccas of both Texas and the South in general, the city offers a vibrant lifestyle for its residents, artists or otherwise. On paper, it’s an ideal spot for any MI supplier or retailer. In real life, these institutions serve their steadfast musical communities and reap the creative and fiscal benefits – as you’d imagine – but still face struggles in spite of the area’s massive growth. From the weather to the ability of musicians to actually find local gigs, all these factors trickle down to the MI realm of Austin. Rising rent prices and cost of living, of course, are more widespread concerns that also apply.

This year, MMR chatted with folks who represent the MI world of Austin to get a better glimpse of this delightfully dedicated-to-weirdness part of Texas, and what it has to offer the MI market. Read on below for five unique perspectives on the Austin market. 

Strait Music

Clint Strait, Vice President

Clint Strait, vice president of Strait Music, is a born-and-raised Austin resident, working at this third generation, family owned business. Strait Music actually boasts two brick and mortar locations, one in the northern region of the city and the other towards the south. Clint has been serving as the vice president for roughly 13 years now, a good chunk of Strait Music’s 50-plus years in business.

“We take a lot of pride of being a longstanding business in this great city,” he tells MMR. “Music being our identity and the fabric of our city means more players and more inspired to play.” Strait Music’s clientele seems to reflect the full span of how MI stores can expand their reach: from podcasters to houses of worship, the store capitalizes on all the not-obvious sales that MMR has covered in the past.

“Being a true full-line store, we have many customer profiles, from the live music venue customers and bedroom podcasters in pro audio to houses of worship buying pianos and everything in between,” Strait says. “We cater to beginner families in our band and orchestra departments and really have a focus on families throughout the store. Being around as long as we have, we have many professional musicians, some famous, that shop in our fretted departments, in addition to working professionals with a music hobby. In every department, we go from 1st time player to seasoned professional and have gear to suit all ends of the spectrum. We sort of pride ourselves in catering to everyone.”

Despite the fact that Strait describes the scene around town as lively, he notes that many Austin-based musicians often find better paying gigs outside of the city, making it harder for them to earn reasonable pay at a musician.

“Certainly it’s a ‘healthy’ scene given our focus on live music as a city,” he explains. “I would say for musicians, though, it’s becoming much harder to actually make decent money playing in Austin. Many of our local bands have to travel outside the city to play gigs for that reason. Certainly though from a retail standpoint, we are quite lucky to be in a city where music is our identity. [It] just leads to more players, and thus more customers. We also have a focus on music in our schools relevant to other places, so that leads to a vibrant school music climate as well.”

Also troubling is the rise of rent prices, which means current employees may have to move out of the area, costing stores valued and already-trained salespeople and clerks.

“Along the same lines, it has not affected us at Strait Music, but rising rents can be difficult on other local retailers and it has forced people to move or cease operations,” Strait says.

Still, Strait sees the “grind” in Austin musicians and retailers, and still has many “good local competitors, or ‘competi-mates’” and national competition thriving in the Austin area.

Sonata Marketing

John Files, Owner

(formerly of Bass Emporium)

After over 25 years working in retail, John Files opened his own operation, Bass Emporium, in 2002. Following ten years in the space, however, Files eventually moved his business online, and then started Sonata Marketing, working with Elrick Bass Guitars, ProCo Cables, and GR Bass Amplification. Still, Files’ operation remains based in Austin, and Files himself still interacts with the public daily.

“I’ve always been passionate about bass guitar and wanted my own operation, so in 2002, I opened my storefront and got the opportunity to do it my way,” he explains of his personal history in the MI realm. “It was hard work, but I really loved my suppliers, my staff (Chuck Brown and Joshua Zarbo) my teachers (Ed Friedland and Lynne Davis), and all of my customers. I owned the building in which I had my business and had the opportunity to sell it and carry the note for a financial advantage in 2012. I sold the building and went online for a couple of more years and then started working with Elrick Bass Guitars and doing Music Product Marketing. I had never been in product distribution, the one part of the retail life cycle that I never participated in, and thought I should complete the circle. Sonata Marketing was then born as distribution. I wanted to create a distribution outlet focused on the indie retailer and intended on keeping it ‘indie friendly’. I want each of us to develop a relationship where we both take a couple of knocks, perhaps, but then both feel the rewards of operating an honest, fair business.”

At Sonata Marketing, Files is still working in Austin, contacting retailers and overseas suppliers, as well as shipping and receiving products, among many other responsibilities. Even though he no longer owns a physical shop, Files still has a front-row seat to the massive growth that the city’s been experiencing, and the increased population means more customers for everyone. Even better, Files says the general population in Austin is “inquisitive, engaged and willing to spend money on music gear.”

“You make lifelong friends out of some customers and there are always new musicians moving to town, expanding the market,” he explains. “We’re experiencing the highest growth rate of any major city in the USA for consecutive eight years, with an average of 157 per day moving to Austin (about 56,000 per year), so your market is constantly increasing. We are now ranked as the 11th most populated city in the US. It has grown and changed a lot!”

Files describes the health of the Austin music in a similar, positive light, calling it “very engaged, vigorous, and eclectic” thanks to its steady reputation as a live music town.

“Austin is one of the truly great music towns – lots of bands, single acts, composers, and music students,” he says. “You can hear music any night of the week in dozens of places around town (not including 6^th street). We even have a stage at the Austin airport. We also have the ACL Festival (typically in October) that began in 2002. It is now two consecutive weekends and last year over 450,000 attended. In the spring we have SXSW (South by Southwest), which began in 1987. This is the largest music conference and festival in the world with over 2,000 bands playing all over town through the seven consecutive days. We are a live music town!”

Even outside of music, Files explains that the Austin population is active in general, and attracts other forms of arts and entertainment, keeping the city fresh overall. The median age is also lower in Austin than most cities – and the median income level is higher – which translates to good business for the entire scene.

“We have a lot of outdoor activities and many unique enterprises that keep things interesting (our unofficial slogan is ‘Keep Austin Weird’) and progressive,” he says. “Whenever you get a smart, educated, upwardly mobile consumer base, you have the opportunity to try new products, experiment with marketing and take a few chances that you might not otherwise. We do a lot of major film work and commercials here and that always provides a haven for some rather famous personalities and musicians to live here without being hassled in their everyday lives.”

He continues: “We have a lot of local customers ranging in age from very young first timers to elderly, from beginners to professional musicians. The median age in Austin is 30 years and the median income level is $55,500 per individual, so we are over the national average for income and younger on the median age (which is 38 in the United States). This provides a youthful population with disposable income, and they love to spend it dining out, jogging, volunteering and, most importantly, listening to music.”

Still, when it comes to the cons of living in the Austin area, Files – like many – says many issues boil down to financial matters. While rent prices keep rising, a problem unique to Austin is its high property taxes.

”The two biggest challenges for any MI supplier in Austin are, a) the cost of real estate (whether leasing or buying) and, b) the taxes,” Files says. “We do not have a state income tax, so our property taxes make up for the difference. Property is always hot in Austin, we never had a slowdown in the mid-2000s, and it is more expensive and hotter than ever. To find the right size location WITH parking is quite a challenge. Another challenge, and not just in Austin, is the shift in the musician’s income. They earn less than ever before (on average), both live and recording, and that is a challenge for all MI suppliers. Hobbyists will always have discretionary funds, but keeping the full-time musician in the mix is a challenge, but very vital.”

The riskiest stumbling block, though, has nothing to do with the area, and more to do with what the modern MI market is like as whole. New approaches to sales and marketing have cost smaller retailers, he theorizes.

“The biggest challenge, in my humble opinion, is the shifting marketing/sales model that creates pain and confusion between the supplier and the retailer. You have brands selling direct, you have the independent retailers building a brand and then that brand gets leveraged into a big-box or a one-location super Internet outlet. The big guys are not brand builders, they capitalize on the brands being built and selling lots, while the small indie retailers suffered the pain of building the brands. I don’t see the sweat equity paying off for them – that is going to affect what products are successful or not going forward.”

Still, Files remains optimistic, and looking forward, he says the ever-expanding population and infrastructure in Austin signal more growth for the city in the coming years, spearheaded by many different industries together.

“Things are not slowing down any time soon. We presently have 20-plus skyscraper permits out for new construction downtown. With industry giants like Apple, Dell, IBM, Amazon, Apple, Applied Materials, AT&T, National Instruments, Whole Foods, and Samsung making their home here, we always have a strong, diversified customer base. I predict that this will spill over into all of the retail sectors, including MI and the overall health of the ATX music scene.”

South Austin Music

Bill Welker, Owner

South Austin Music owner Bill Welker sees Austin as the live music capital of the world and counts serving the city’s musicians as a privilege, from putting guitars in the hands of newbies, to fixing the gear of learned pros.

“We don’t have a typical customer,” he says. “We have customers that are well known and recording with big names that we serve daily. And we have young players that are 14, 15 years old just falling in love with a guitar. And we have everything in between, there’s not a typical customer. If it was a typical customer, it would be a guitar player that loves guitars and loves to see a nice array of new, used, and vintage guitars. But that’s basically all of our customers. But let’s not leave the banjo players out, the mandolin players out, ukulele players out. We have something for everybody. But you know, as I’ve said, we cater to working musicians, so we’re full-service amp repair, guitar repair.”

From serving these Austin area-musicians, though, Welker has learned that it can be difficult to land well-paying shows in town, forcing many players to be on tour more often than not.

“Here at South Austin Music, we cater to the working musician. So from what I know learning from our customers, gigs are a little tough to get,” he says. The average pay is less than what it should be for a quality band. But it is Austin, Texas. And there’s live music everywhere. And not just live music but great, great quality live music everywhere. I would add that the cost of living in Austin has been on the rise. And that makes it hard for working musicians to make ends meet here in Austin. But most of the successful bands are playing regionally, if not nationally, so they enjoy calling Austin home.”

Believe it or not, beating the heat is another reason that keeps bands and individual performers out of town year-round in Austin, even if that’s where their home is.

“I already spoke to someone today that said they’re on their way to Boston, because they don’t like being in Austin in the summer, and summer is here,” he explains. “Most touring acts, they go on the road – they travel, they get out of the Texas heat as much as possible. We also see an influx of new people, new customers that discover the store. And we’re a popular store, so it doesn’t take them long to learn about us.”

From a brick and mortar store’s perspective, rising rent prices are also of concern. Welker himself purchased the building that South Austin Music does business in a few years ago after renting it for thirty years; other stores, however, have not been as lucky.

“That was just very fortunate that I was able to pull that off because a lot of businesses have gone away,” he says. “I mean, there were three other music stores between my store and the river downtown, and they’re all gone and relocated. It’s a real blessing to still be in the spot where I’ve been all these years.”

Near South Austin Music is another music staple for the, Saxon Pub, which was recently purchased by Gary Keller in order to not only preserve and protect the venue, but, give it a facelift. Both situations show the economic shifts taking place in the area, and how Austin locals are adapting.

“The building that I had to buy in order to stay put has got a live music venue on one side that someone bought a building just to preserve that venue,” Welker says. “And on the other side is a new apartment [building], massive structures. Across the street, there’s going to be a new development of apartments. And it’s going to eventually give us more customers. But it is also taking away things that are dear to us. Places that are dear to us.”

He concludes: “Austin is expanding vastly, rapidly. Unfortunately, when change happens, you lose some of what attracts people to come to Austin. And we as a community have gone through that. And we are closely holding on to what made Austin what it is. We don’t want everything to be replaced with shiny new. We love the favorite live music venues and the favorite record stores and the favorite music stores that people love to go to. And because of its rapid growth, those types of places are going to the wayside because of affordability issues.”

Austin Guitar House

Brent Tenczar, Manager

Over at Austin Guitar House, manager Brent Tenczar – like many others – has witnessed an overwhelming amount of continued growth in the store’s eight years of business.

“I think the overall health of the Austin music scene is still very strong. It seems as though there is a new music venue popping up every other week, and there is a constant onslaught of musicians still moving here every day!” he tells MMR. “There is a treasure trove of incredible guitar players that just doesn’t seem to run out. And we feel very lucky to work with a lot of them here at AGH!”

He adds: “I expect nothing but growth over the next few months. AGH has been in Austin for coming up on eight years. What we have seen year after year, month after month, is that this City is becoming more fruitful all the time! And with Google and Apple both building new campuses here in the coming year or so, that’s only going to bring more people, which by default brings more music!”

Like any store, it’s tough to define a “typical” customer for Austin Guitar House, but Tenczar says very few beginners are in the shop due to the fact that Austin Guitar House is a higher end boutique store, although there are some rare exceptions. “Every now and then we will get the mom or dad that really wants to support their kid with a quality product, and that always puts smiles on our faces!” Tenczar says. Otherwise, AGH namely serves working musicians and serious hobbyists. Their eclectic clientele goes hand in hand with what he cites as the best part about running a store in Austin: “Definitely the people!”

“Austin is known as being ‘weird,’ and that is even more true when you talk about Austin musicians!” he explains. “I have worked in guitar stores all over the country, and have never dealt with a more eclectic customer base. It’s fun to go to work every day, as you never know what kind of character you’ll meet next.”

On the flip side, Tenczar also echoes the sentiments of his fellow Austin businesses with regards to rising costs for small business owners, saying that these factors add significant financial pressure to independent businesses.

“The only significant challenge for any retailer in Austin, including MI retailers, is cost of doing business,” he says. “With how fast this city is growing, prime retail locations are getting more and more pricey by the day. In a few years, it may be impossible for a small ‘mom and pop’ store to operate close to downtown.”

Collings Guitars

Steve McCreary, General Manager

Over at Collings Guitars, general manager Steve McCreary feels that both the company and Austin have expanded in tangent with each other throughout the city’s recent prosperity.

“Austin has long had a reputation for attracting and producing boundary pushing artists, both locally and internationally acclaimed. In a similar vein, Collings Guitars, as a company steeped in tradition and quality, has also ‘pushed’ its own industry,” he says. “In this way, Austin and Collings have grown in step with each other by continually working to establish themselves as leaders in both music and instrument manufacturing.”

As a result, Collings has reaped the benefits of the many pros of the Austin area, such as close proximity to international ports and a steady influx of new faces.

“As instrument builders, there is a steady flow of touring artists coming through town and lots of visitors from events like SXSW, the ACL Festival and the only Formula 1 track in the United States,” McCreary adds. “Also, as a small exporting manufacturer, we’re not far from major international ports, for both air and ocean. Not only that, but it’s a great place to live.

The music, the food, the river, the lakes and the hills are only some of the contributing factors to that. As far as the music scene goes, I often show the local music listings to people visiting our shop who are looking for live music. They are always in disbelief at the sheer number of places to go hear it.”

The growth, on the other hand, is also what McCreary cites as one of the troubles of running a business in Austin, due to the subsequent rise in costs for shops.

“Partially due to it being a great place to live and previously low real estate prices, I would say that the main challenge would be the explosive growth that Austin has experienced over the past 10-20 years. This growth doesn’t seem to be slowing down any, either,” he says. “The current reports are that 140 people per day are moving here. Along with the tech industries booming here, Dell, Apple, Google, Amazon, IBM, Resideo, NXP, Samsung, Oracle, Facebook, Indeed, Accenture, AT&T, etc., the costs of living and doing business here have grown exponentially as well. Median home prices have increased over 17 percent in the past couple of years, so affordable housing often finds employees commuting long distances from where we’re located.”

He continues: “Increased traffic has also added to that commuting burden. Areas of east Austin, with historically lower costs, now represent some of the highest gentrification rates in the country. Median homes prices have increased 148 percent since 2012, while incomes have only increased 30 percent. I recently read a study that the difference between the amount of income needed to live comfortably in town and the median income is about $30,000. Such realities have certainly been a challenge for us.”

McCreary also cites stiff competition for good paying gigs in the Austin music scene, but is confident that “as long as people keep moving here and the colleges and universities in town keep bringing in young folks, the music scene will thrive and Austin will continue to earn its title of ‘The Live Music Capital of the World!’ As much as things have changed since I moved here in 1974, I still don’t want to live anywhere else.”