Every industry gets to a moment when it starts mistaking its internal competitors for its real ones.
The retail and distribution music industry is in that moment.
The musical instrument, tech and audio industry does not have a competitor problem.
It has a category problem.
It is losing to Bali.
I know how that sounds. I watched over the past decade through the incredible highs of COVID where we couldn’t get enough guitars and keyboards into Australia fast enough, to the current landscape – watching stores closing and industry stalwarts taking their leave.
It is starting to feel reminiscent of my early career at Fujifilm watching the photographics industry tell itself a different version of the same story. Right up until the moment it didn’t have to be honest anymore… because there was nothing left to save.
Where I Am Speaking From
I spent just under a decade in senior commercial roles across Australis Music Group, CMI Music and Audio, and BHSS. Moving from Chief Information Officer through to Group Chief Commercial Officer of one of the largest distributor groups in Australasia, I was watching the Australian music retail and distribution market at close range.
The product mix, commercial transitions. Building retailer relationships. Brand acquisitions. The margin conversations. The shift in how consumers were showing up to buy instruments, pro audio gear, and home studio equipment.
I was not watching it from the outside. I was working with my teams building strategy, winning brands, and developing the commercial relationships that determined whether products moved or sat in a warehouse.
For most of that decade, the conversation inside the industry was almost entirely internal. Who provided the better margin. Which retailer was discounting down to cost ‘screwing the market for everyone’. What the competitor was doing at trade shows. What the next product launch looked like.
Less people were asking the question that mattered most: what is the person who might buy this product actually choosing between. With the cost of living crisis, and the evolution of consumer psychology coming out of COVID (which Australia led in lockdown stats!), this question has become vital to consider, and reconsider as strategies evolve.
I Watched This Happen Once Before
I started my career at Fujifilm in New Zealand. I arrived as digital cameras were beginning to do to film what streaming would later do to CDs. I watched an industry that had been so dominant reassure itself that its core product was irreplaceable, right up until it wasn't.
Think about Nokia which had over 40% of the global mobile market in the early 2000s. Again, dominant in a way that seemed permanent. The ringtone season alone was generating billions. The market position was unassailable.
By 2013, however, Nokia had effectively exited the consumer handset market. A position built over decades, gone in under ten years.
The collapse did not happen because Nokia made bad phones. It happened because Nokia was optimising for a game that had already changed. They were looking sideways at other handset manufacturers while the category underneath them shifted entirely.
The billion-dollar ringtone season was not a foundation. It was a sugar hit. And when it ended, the industry that had organised itself around it was not ready.
Fujifilm survived. Not because they were lucky. Because they asked the question most industries in decline refuse to ask: who are we actually, and what are we actually competing for.
I first-hand watched the demise of Kodak. Nokia. I find those case studies fascinating.
The Question The Music Retail Industry Is Not Asking
To stay ahead of the trends, the market, to ensure you have a future-proofed business, you constantly need to reframe: who is our customer, what is our product.
The customer is not a music enthusiast with a fixed budget for instruments and gear. They are a person. A person with a finite amount of discretionary income, a finite number of free hours on a weekend, and an almost infinite number of things competing for both.
That person can spend their Saturday at a live music event. They can also spend it on a long lunch. At a gallery. A yoga retreat. A short-haul flight to Bali for a long weekend that costs less than some mid-range guitar packages.
They can stay home and spend three hours streaming from Netflix, a platform whose annual subscription revenue alone now exceeds what the entire global recorded music industry generated in any single year before 2021.
The music retail industry looks at this and sees a sales problem. It is not a sales problem. It is a category problem.
The competitor is not the online retailer selling at cost or the distributor with a sharper margin. The competitor is every other claim on a Saturday and a bank account.
What Losing Looks Like In Practice
Go and look at the websites. Not the streaming platforms. The music retailers, the instrument brands, the pro audio pages, the gear publications.
Now go and look at Iconic. Adore Beauty. Any mid-tier travel booking platform.
The gap is not just aesthetic. It is not a design budget problem. It is a signal. It tells you how the industry thinks about its customer. If you are not competing with Adore Beauty for attention, aspiration, and conversion, you do not build like you are. You build like you are competing with the music shop next door.
If you cannot get someone to choose a musical instrument or a home studio setup over buying clothes, travel, or an experience, that is not a marketing problem. That is a category positioning problem.
The product has not made a compelling enough case for itself in the full landscape of things a person could do with that money.
Most of the industry is still arguing about which retail site is selling a product at cost right now, or what distributor has the better margin on offer. Those are definitely real conversations and they should be hard fought. They are not the conversation.
Every Industry Has A Ringtone Season
The music retail industry had its own version. The physical instrument and gear boom that came with the home studio wave. Followed by the consolidation of major retailers. Followed by the move online. Followed in Australia by not being able to leave one’s home or go outside or to school or play sports during COVID.
Each shift arrived and the industry spent its energy arguing about channel strategy and margin structure rather than asking what the shift meant for who was actually buying and why.
A separate and significant disruption is happening in music creation itself. GarageBand and BandLab have made entry-level music production accessible to anyone with a phone.
That is a different challenge to the one this piece is addressing. It affects instrument and studio time sales in ways the retail industry is only beginning to understand. But the response to that disruption follows the same principle: you cannot solve a category problem by optimising a product problem.
That is another conversation entirely.
What Is Actually Defensible
Platforms without work do not afford you community. Scale does not afford you community. This was said at a conference I attended recently and I wrote it down because it is the most useful thing anyone has said about where the music retail industry's commercial future actually sits.
Community requires people to have something at stake. Not a loyalty program. Not a follower count. Stake. Something that means something to them and to the psychological tribe they identify with.
The retailers, brands, and distributors that are surviving the category compression are not the ones with the widest range or the sharpest price. They are the ones with the most believers. Customers who would not buy the same product cheaper elsewhere because they trust what they get from this relationship. Because something would be lost if it were gone.
That is defensible. A race to the lowest margin is not defensible. A community of customers who feel genuine loyalty to what you have built, that is defensible.
The Question Nobody Wants To Answer
I do here what I always advised my teams not to. Come with questions or problems, not solutions.
The reality is, this is a longer conversation and it requires knowing your specific business, your specific customer, and your specific position in the category.
What I will tell you is the question that needs to be answered first, before the strategy, before the campaign, before the rebrand.
The Grief Question: If everything you built disappeared tomorrow, your stores, your brands, your distribution relationships, your catalogue, who would actually grieve it? Not who would notice, not who would find an alternative, who would grieve it? The way you grieve something that cannot be replaced.
Bali just became the world's number one travel destination. TripAdvisor's 2026 rankings placed it above London, Dubai, Paris, Rome, and New York. Not just a long weekend for Australians. The most coveted destination on the planet.
If you have a clear answer to that grief question, you are building in the right direction.
If you are reaching for an answer, you are competing against Bali.
And Bali is winning.
We are in the game with discretionary spend. That’s clothing. It’s Nike. It’s travel. It’s experiential.
This is the kind of conversation Mentor Academy was built around. If you are building something in the creative industries and you want to think through where your business actually sits in the full competitive landscape, not just against the retailer next door, the platform exists for exactly that reason.
Helen Marx is a Co-Founder of Mentor Academy and the CEO at Temple Medical & Scientific.
