JL Audio Acquires Total Mobile Audio April 27, 2004 -- Miramar, Fla. -- JL Audio, manufacturer of aftermarket automotive auto sound systems, has acquired Total Mobile Audio LLC, a Phoenix, Ariz.-based provider of entry-level mobile audio components. Total Mobile Audio was founded early in 2004 by industry veteran Dan McLeod and his wife, Deb McLeod. Prior to founding the new company, McLeod held the position of VP of sales and product development at Rockford Corporation. Total Mobile Audio offers a compact line of auto sound components including amplifiers, component speakers and subwoofers. JL Audio President Andy Oxenhorn said, "We are very impressed with Total's business model, products and marketing approach. Dan clearly saw a need for quality entry-level products targeted towards independent specialists within a strict limited distribution model. We are very confident about the potential of this brand and the vision behind it." McLeod will remain as president of the wholly owned subsidiary and establish office and warehouse operations in JL Audio's Phoenix, Ariz., facility. Dan McLeod said, "I am really passionate about the idea behind Total Mobile Audio and thrilled at the opportunities presented by JL Audio's acquisition of the company. We are going to offer independent specialists 'The Total Package' in entry-level products."
I agree. JL is known - and rightly so, IMO - for making high-quality products... meaning that even their entry-level products have a place in fairly high-end applications. I've read a great book on the concepts of branding, and they continuously beat into your brain the importance of brand integrity, brand recognition. For example, they cite Mercedes Benz as a great brand... because when you see the name, you instantly conjure up an image, in your head - high-end, high-priced, desirable, quality cars. And similarly, they cite Chevrolet as a bad branding example... because it is so diluted. Is Chevrolet a large, small, cheap, expensive, sporty, practical car? There's no image associated with it. Corvette? Aveo? Trailblazer? They also caution about companies that desire to expand, expand, expand... into areas that they aren't known for their expertise in. I'd be worried that JL will end up polluting their good name... first by diluting their brand image and recognition. Secondly, in the low-end market, you aren't dealing with enthusiasts. Name recognition isn't what sells those products. Those that do recognize the name are going to be at least partly comprised of enthusiasts that are familiar with "JL quality", and when they get something that's not - they'll be disappointed, and negative word-of-mouth is not in the long term interests of JL. ...just as the book cautions against - short-term benefits (new market, increased sales, yada, yada) at the expense of long-term profitability. We'll see if I'm right in the long run, I guess... if JL doesn't think better of it before they release low-end products. If they are smart - they'll use this aquisition to simply manufacture low-end products under an alternative brand name - not running risk to the JL name, which should be regarded truthfully as sacred to them. B)
that is what they will do, why else would they buy the name? IF your JL you dont just buy a company for the Products Total Mobile Audio had NOTHING JL could not come out with in one day, the sole reason for the buyout WAS THE NAME
I disagree... It's the whole business model - and that is different than what JL specializes in now. I don't think it's just the name... I haven't ever even heard of that name before, and I'm sure I'm not alone there. Yes, JL could no doubt start making low-end products... But doing so from scratch involves "undoing" many things they do today, learning new manufacturing tolerance limits, learning a new market segment and what they deem to be acceptible compromises, new marketing strategies to appeal to this legitimately different group of enthusiasts, etc... And if you have the same employees working on the high-end product and the low-end product simultaniously, may even risk blurring or borrowing in ways that aren't really productive to either... but it's often human nature to resist switching mental 'modes'. ...or, alternatively, you can just buy a company that's already in that groove, in that mode, and successfully so... with employees who are already experts in these areas, with respect to their target demographic. A great many companies do this... aquire some smaller company that has different core competencies... with the plan of simply integrating them into the existing nameplate, because it seems like a good idea to expand the brand - "We'll have 10 product lines, rather than 6!" I'm in the stands on the side of not polluting JL's good name with what really are non-JL products... but that's not to say I've got 100% confidence in my team that they'll win that game. Many, many, many companies have come before JL... and I'd even venture to guess that more of them chose to assimilate than maintain discrete brand identities... ...ironically enough in some ways because it let them minimize the number of employees and 'best practices' (ironic because it erodes at that business model they are aquiring). We'll see which way JL goes... they are obviously a bunch of smart guys - and obviously not just in driver design. B)
I dotn know about the "smart" part, but that is me.. as far as Buying the company for more than a Name, you misunderstood, JL bought them so they could reap the Profits of the Lowend Market, which is by far more profitable than the highend IMO, but like you said they dont want to Tarnish the JL name so they Bought a Company, Give that company enough Finchal Backing to Make a Strong Start 90% of the problems when starting a Business are related to Working Capital, JL does not have that problem
Good point. Although, their w0 and w1 lines did very well from my understanding. If these lines are lower than them I am afraid I will lose respect for JL for even acquiring this company, no matter if they use the JL name to sell them or not. JL has always provided a quality product and charged a quality price for it. Sure some want cheaper products but I personally dont associate JL with cheap. Them buying this company could change that if its cheap equipment.
