Dealer Spotlight: Definitive Audio
I was in Seattle last November, and while I was there I decided to visit a couple of the area’s many audio stores. One of the stores I visited was Definitive Audio; Showroom Manager, Ron Paternoster, and Marketing Manager, Jennifer Griffin, were kind enough to take time out of their busy schedules (at short notice, no less!) to play hosts. After a tour of their showroom, I had a conversation with Ron and Jennifer about life at Definitive and audio in general.
What’s your background? Tell us a bit about yourself (both the company and personally).
The company was founded in 1975 by Jim Croft and two other investors. Jim’s background is acoustical engineering and all three were audio enthusiasts.
As an enthusiastic audiophile, having recently graduated from the University of Washington with a degree in business, our current President, Mark Ormiston, joined the company in the early 1980s, right after Definitive moved into a larger facility, and bought out one of the original investors.
In 1990s, with a new partner/investor, they formulated the plan for Definitive to become the company that it is today, and it took off from there. They went from being a small operation that just did really high-end two-channel audio and some home theatre, to being this hybrid of doing high performance music, home theatre, and custom installation that’s done from a bricks and mortar showroom, which is really the unique thing that Definitive has done.
While a lot of the high-end dealers went to being a “by appointment only” custom show room that was maybe in their house, Mark decided that it was really critically important for customers to come see, hear, and be able to compare products if they were going to build high performance home theatres and two channel systems. In the mid-1990s that approach had sort of disappeared.
During the 1990s the company continued to grow. We built a second facility in Bellevue, and then just last year we bought the place down in Tacoma, Advanced Audio, which is owned by Curtis Havens. If you look across our sales staff, we’ve collected talent from all over the country: people have come here to work for Definitive and we’re pretty pleased with the staff we have. Most of these guys have been here for years: I’ve been here for 16 years, John’s been here the same time, Craig has been here 18 years. Most of our core people have been here a long, long time because we enjoy working in this environment where we just don’t do ultra high-end stuff, we service the whole range of customer needs and we’ve got a whole palette of everything to work with. We don’t suffer unhappy people. We basically have the resources at our disposal to ensure that our customers are absolutely thrilled with what they buy.
Speaking personally, from where did you get your love of hi-fi?
My first taste of hi-fi was when I was eight or nine years old. I heard a pair of Dahlquist DQ-10s at an audio store in the mall called Shock Electronics in Rochester, Minnesota. Then when I went to college I started working in a hi-fi shop. I worked for a gentleman called Jim Ingadella who really taught me the craftsmanship of hi-fi: how to set up speakers and turntables, and how to tune a hi-fi. He started my life-long obsession with Linn. He was a big fan of Linn and taught me how to listen, told me what to listen for, and how to compare hi-fi components. Eventually he said, “It’s time for you to go out into the world and work for big hi-fi company, one that’s got more customers that are more interested in these types of products”. He recommended about three different places; I interviewed with them and this was the obvious place to be, so I moved out here from Wisconsin and I’ve worked for these guys ever since.
How important is it to have a great relationship with the manufacturers of the products you represent?
It’s absolutely invaluable. I’m here ultimately in service to the client; I think that being relevant in whatever you do makes it easier to get things done. Several of our manufacturers come to us with design questions, we see prototypes, we get asked, “what kind of products do you want to see us make”, and we get to beta test almost everything our manufacturers make. So it’s nice for a lot of reasons and very good for our clients, I think.
Do you sell used gear in addition to new, and if so, roughly what percentage of your business comes from buyers of used gear?
We used to sell used gear in the store. Tom, who’s been here more than 20 years, has always been active on line, building his own hi-fi and selling used equipment via Audiogon. We have a consignment service that he runs that’s very effective, so if clients want to do an upgrade or they’re downsizing their home and want to move a portion of their system, Tom handles everything from photography to putting it online to dealing with it. The unique thing about that is that most things on Audiogon are really inconvenient. We’ve got all the things like Visa and Mastercard that they don’t normally have. We’re pretty effective at moving product, and we do it on a sliding scale based on whether upgrades are going to happen. So we’ll take a much smaller cut if the customer is going to do a significant enough upgrade. If it’s a straight up sale, we’ll take a cut that makes it worth his and Definitive’s time.
How has the global economic slowdown affected your business?
From a retail perspective, there’s a lot less door swings. I think that any retailer you talk to will have a lot fewer people coming through the door. Through the years I’ve been here, advertising has never been a big priority for us. We’ve always worked off word of mouth referral. We believe that with an experienced sales staff that builds relationships with customers, we don’t have to depend so much on people coming in and buying a box.
We touched on this a bit earlier, but what are the benefits of buying from Definitive Audio?
Even our least experienced guy here, Jesse who’s 26 years old, is a master speaker set up guy. When you buy a pair of speakers from Definitive, you get... We don’t just sell them to you, we go out to your house and set them up.
The same thing applies to our installation crews. We’ve got guys with 15, 20 years of experience, and some even more than that. We do everything with attention to quality and detail. I won’t say that we’re the cheapest. We probably never have been the cheapest, but at the end of the day, when you avoid follow-up visits because it’s done right and you’re pleased with what you got, we actually end up being the cheaper option.
But I think what really makes us different is the level of experience we’ve got. You can buy B&W speakers up the road, but they’ve only had them a few months. We’ve had them for 35 years and I know every model they ever made, and I know what the older Matrix series work with, because they’re nothing like the current offering. We don’t just sell stuff. We build relationships with people that last a life time. We are their hi-fi guy, or their theatre guy; it’s one facet of your life, like when you trust your doctor, there’s no reason to worry about your health because you can make a phone call to your doctor. We’re their electronics guy. That’s our goal: to have a life-long relationship that’s good for both of us.
How would you describe your average customer, and roughly what proportion of your customers are new (as opposed to repeat business)?
I would describe our typical customer as an aficionado. At this time, the guy that comes through our door is not here by mistake. He’s got an interest in what we do, usually is a performance enthusiast to some degree—it could be video or audio. I’d say other customers are the very discerning, luxury buyers. We have a great deal of those clients who have very high expectations and want to own the very best. The percentage of new versus old, I’d say... We have a very, very strong repeat business, and I’d have to look at the numbers to tell you, but far more than 50% of our customers are repeat customers and I’d say maybe even 70% or more are people that we continue to do new homes for or that add onto their system.
Roughly what proportion of your clients have analogue sources, and how has that trend changed over the last few years?
I would say that it’s maybe 20% to 25%, and that’s increased sharply over the last few years. There’s been a lot of LP12s coming out of closets and getting refurbed in the last couple of years! I really noticed a spike... We did an LP12 clinic, which we’ve been doing for years, about three years ago when some the new upgrades came out, and we had 18 people, 16 of which I’d never seen before in my life, bring in LP12s to get worked on. Some of those LP12s were 35 years or more old, they were early 1970s LP12s. The thing that’s really exciting is that we’re right by the University of Washington: we’re 15 blocks away. Of the walk-in traffic, I would say that in a week if we have a hundred people walk through the door, ten of them have questions about turntables. And many of them are young, so the Pro-Ject products that we sell and also for guys who are on their second life with analogue, that VPI Classic has been a godsend. You know, a lot of them don’t want to make the jump to a super ’table like a big Linn or an SME or an HRX, that ’table, at $2,750, has been a real solid choice for a lot of them. So between that and computer audio, they dominate the conversations in the store every day, and our focus too.
Do you host any after-hours events, and if so, what impact do they have on your business, especially from new customers?
We do, I would say, on average about one per month. Our Director of Performance Audio, Craig Finer, does nothing but set up hi-fis, tune theatres, and also run events that are vendor related. Last month we did a catered Magnepan event, the month before he did a seminar called Tips and Techniques, and in September we had a Linn evening. So we do one almost every month after hours. I would say the clientele is a lot of repeat folks, but a few new people based on what the focus is. When we did computer audio we had some new faces I hadn’t seen from over on the East side. We’ll be doing an LP12 one here with Alan Williams from Linn on the second, and the next week we have a Meridian event with Norm Stunky and Ken Forsyth coming from Atlanta to do a demonstration of the 808.3 and the Sooloos integration.
Two times per year we do very large events. We do a home theatre event typically in the third week of June. It’s a big budget, non-sales evening, where we would typically have the likes of David Wilson, Bob Stuart, and other big heavy hitters come in. We convert our entire Bellevue show room to a display of new home theatre technology. Many, many things are shown for the first time ever there, for example, the Sophia 3s were shown for the first time anywhere at our home theatre event in June. That was the first time the trade or consumers saw them. We’ve been doing this for eighteen years now, I think, maybe more.
We’ve always attributed that to a strong surge in sales and interest in home theatres. It’s never been a selling event—in fact, it’s always prominently spoken about not being a sales event—it’s simply a way for customers to see the new products. It’s for fun, for people to come and enjoy what we do and what our industry does. But we do notice an increase in sales. I mean, people having exposure to the likes of David Wilson, they’re going to be excited about this stuff, which is the whole goal!
Then here in Seattle, in February we do an event called Music Matters. It’s a one evening event, and last year we had about 500 people in the store, maybe more. It was pretty crazy! [2011’s Music Matters event was attended by more than 400 people in five hours, and featured companies like Wilson Audio, Audio Research, Transparent Cable, B&W, and Meridian.] Everyone who owns these companies was here to answer questions and do two-channel demonstrations. We basically convert the entire store, we take everything out of it and make listening rooms that we do half an hour to an hour demonstrations in. Again, people can hear a bunch of world premiere products.
Last year we world premiered the Sasha, and of most interest to a vinyl guy, we had one of the coolest things I’ve ever experienced which was the Audio Research Reference Phono 2 with the SME 30/2 and a Lyra Olympos. Serial number 1 Olympos; it belonged to Allen Perkins. So that was a pretty neat treat. I don’t think I’ll ever get to hear an Olympos again!
All these events... I think a lot of retailers crawled into a shell whereas we’ve continued to do them because we think what we do is awesome, and we think that the more people that are exposed to it are going to enjoy it and want to be part of it. So even though these are non-selling events, I think all of them have a positive impact on our business and are one of the reasons we’re... we’re not thriving, but we’re not dying. We’re working really hard and we think that once the economy straightens itself out, we’ll be in an even better position.
How do you decide whether to take on a new line?
[Laughs] We’re extremely cautious about it. It’s not because we’re picky—well, we are picky because what we represent to our customers is important—but we look at it from two perspectives: what can we do for our manufacturers, and how is it relevant to solving problems for our customers or making their lives better or more exciting.
The easy part is listening: we could say, “That’s a great sounding preamp”; we have this to reference it against and here’s where it stands, what we think of it. That’s very easy. What’s not very easy is “What’s going to happen in 20 years?”, because if you have a 20 year old Audio Research preamp, I want to make sure I can take care of it for you. A lot of these manufacturers just aren’t going to be around. So the test of time isn’t something that we measure with our ears, but it is very important for our clients to have these companies that are based in reality and their engineering is solid and all the products they make are great.
For example, take Ayre Acoustics. It took us seven years to bring them on. We eventually landed on Ayre because of their great sound quality—there’s no one that listens to Ayre and doesn’t say there’s something really good going on here—but what really got us was the way they take care of their customers. It took us that long to watch them to realise that we wanted to forge a long term relationship with the company, that takes care of people like we do.
Talking of manufacturers, what are some of the brands you represent?
In two channel, our big daddies in terms of electronics are Ayre Acoustics, Audio Research, and Classé Audio. We’re also a Linn and Meridian dealer who we feel very strongly about, maybe in a little bit of a different way, sort of systems of their own. Our primary speaker manufacturers are Wilson Audio, B&W, and Magnepan. Linn is certainly a big player, and we’re very excited to have just brought on PSB and we’re super excited about their sound quality at a very affordable price point. For cables we have Transparent Audio and Audioquest. As for cartridges, we sell a lot of Linn cartridges and a lot of Lyra cartridges. We also do a lot of business with Benz, some Clearaudio. The Goldfingers, have you heard one of those?
I’ve not heard one, but I’ve heard of them. Actually, thinking about it, I think I heard one at the Rocky Mountain Audio Fest.
So with cartridges, it’s whatever is right for the job. We work on a lot of record players here. John, the tall fellow you see there, really knows VPI and SME. He’s an extremely detailed, precision orientated kind of guy. We own a Fozgometer, an oscilloscope, microscopes; just about any of the analogue tools you can think of, we have here in house.
What’s the best demo session you can remember? And the worst?
One the things that comes immediately to mind is that I was helping Josh Clark from Transparent Audio set up the Sashas for the first time with the new Audio Research DS450 solid state amplifier and the Reference 5, and the aforementioned SME 30/2 with the Olympos on it. It was a unique set up of Sashas that I’d never seen—I’ve been setting up Wilsons for going on 20 years. Josh—who I think is an absolutely brilliant guy, I was more his mule during this process! [laughs]—he set them up, and that was one of the most stunning set ups I’ve ever heard.
As for the worst, this happened to me more than once in my career, especially early on. Setting up Linn active systems, I’ve actually hooked up the midrange and tweeter wrong, and while demonstrating to a customer his new speakers, blowing up the tweeters! I think I’ve done that not once, but twice in my career! [Laughs] Fortunately I had no problem fixing the tweeters, but yes, embarrassingly so, I have done that. If you’ve seen some of the Linn systems that have six different sets of drivers and six amplifier channels on them, it’s not that difficult to do if you’re not paying attention. I get pretty excited about hi-fi and I get to plugging in too quickly, and that was the result! [Laughs] That would definitely have to rank up there!
As a specialist audio dealer, you presumably have access to pretty much whatever gear you want. What’s currently in your home system?
A full blown Linn LP12 turntable and a Linn active system. Right now I’m using a Meridian preamp because I have a dual-purpose system: it’s a theatre and it’s a sitting room. I’ve always owned Linn systems for twenty odd years. You probably picked the most unexciting guy in the store to ask, ’cause every one of them could tell you what I have in my house! [Laughs] But there’s some variety now, there’s a Meridian processor in there right now, but typically I’ve owned Linn active systems and vinyl is my primary listening source.
That leads my nicely into my next question: how much time to you get to spend listening to music at home, and what are your favourite records?
I don’t get to spend a ton of time listening to records at home, but I’m a child of the 1980s and 1990s. I like Indie or college rock, and I’ve always been a big fan of bands like Sonic Youth and Pavement and I have all their LPs. If I was forced to pick an LP, I guess it would be a Yo La Tengo or Sonic Youth album that I would end up putting on.
Presumably, you’ve become friends with many of your clients over the years?
Yes. Many, many of them I would include amongst my best of friends.
What’s next for Definitive?
I think we’ll continue to do what we’ve been doing. We think our model of having a retail showroom with salesmen with all the resources that a custom outfit would have is really the way that is most enjoyable for our clients to buy hi-fi. We’ll continue to be performance orientated, I don’t think we’ll ever be much bigger than we are now. We’re at a point where we have talent in every position. We’ll continue to consolidate that and we’re happy with how our showroom looks. Growth can happen within the structure we’ve built and that’s good.
But we’re not going to change what we do; none of us could stomach offering components to you we wouldn’t want to own ourselves. Hopefully the industry will follow suit. It’s been a disheartening few years with some of our manufacturers having gone out of business, some of the products that we’ve had for years and years are not exclusive to us any longer, so hopefully more people will look at it like Sandy Gross is looking at it: I want to do business with these little guys who take care of people.
It’s really heartening hearing people say the same things we’ve been saying for years. We do think that people won’t buy this stuff unless they can hear it and touch it and see it. You can’t sell Audio Research without people... I don’t covet things that I can’t see or can’t hear or can’t touch! Hopefully, the model we’ve got will be viral, that people will believe that it’s the right way to buy things.
Contact Information
Definitive Audio
6206 Roosevelt Way NE
Seattle
WA 98115
(206) 524-6633
www.definitive.com