Reviews, Content, and Own Publishers: How Musikhaus Thomann Achieves the Billion Revenue

1. Descriptions, reviews, all in detail
2. Creating the right atmosphere
3. Creating content portals yourself
4. Adtech also in-house
5. The right partnerships
6. Gearing up for the future

Many e-commerce companies are currently looking for a strategy to somehow compete against Amazon. Particularly noticeable in Germany is the music store Thomann. The company is considered the world's largest shipper of musical instruments, studio, lighting and sound technology. We show you which role extremely in-depth product reviews, a thoughtful content strategy and clever affiliate measures play in Thomann's rise to becoming the world leader.

The story of Musikhaus Thomann begins as early as 1954 in the tranquil Treppendorf near Bamberg in Upper Franconia (now part of Burgebrach). From the music business grows today's huge e-commerce player with billion-dollar sales and almost 2,000 employees. Hans Thomann junior, son of the founder, already took the step into online trading in 1996 and still runs the family business today. But since he also leaves the digital strategy to others according to his own statement, we talked to Sven Schoderböck, VP E-Commerce at Thomann, about how the 100,000 products - from the guitar, to the podcast microphone, to the DJ equipment, get to millions of customers around the world.

Descriptions, reviews, all in detail

Sven Schoderböck, VP E-Commerce at Thomann

"Our greatest challenge is to give the customer at a distance the feeling that he learns everything about the product of his choice from us and can therefore shop online risk-free", says Schoderböck. "There I see three important points to achieve this: First, everyone must have the feeling that the people behind Thomann live and breathe music. Secondly, the process must be risk-free. We grant 30 days money-back guarantee and three years warranty on every product. And thirdly, the product descriptions and reviews must really be helpful." On the whole, the Thomann strategy boils down to one central feature: absolute expertise in its own niche.

And the retailer achieves this on three levels: In each product category, three Thomann experts are shown, who also provide advice by phone. The descriptions of individual items are extremely detailed and are written by an internal content team. In some cases, Thomann provides sound samples for guitars, for example, or embeds video reviews by Youtubers. The third level is the mentioned reviews. Not only are there very many reviews for almost every product, but they are also extremely detailed. All three levels in conjunction you can see, for example, with this microphone.

Creating the right atmosphere

"Many good reviews certainly make a purchase more likely. Especially customers who have less knowledge and time often make decisions based on reviews", says Sven Schoderböck. However, with the reviews Thomann also manages to strike a balance. "We try to cover the entire range of products. The greatest challenge is to offer a clear retailer profile to professionals and beginners alike, despite varying demands." And this is possible with the reviews and star ratings as a universally comprehensible link. But how did Thomann manage to get a microphone to record 1,633 text reviews – or for example, one of 8,000 guitars in the range to receive 288 detailed reviews? After all, according to Thomann, only those who have bought a product there are allowed to rate it there. So in part, many sales are especially the trailblazers for many reviews.

"We motivate in our customer center to rate last purchases and also send e-mails when a product has few ratings", Schoderböck says. From a certain number of opinions on a product, this would no longer be necessary. Because when reading the reviews you get the impression that for many it almost means an award to give a detailed and well-founded review. It would be almost embarrassing to write: "Delivery great, happy to do so again". Thomann has definitely promoted this atmosphere. "The most important thing was to establish a review culture and aesthetics from the beginning. For this we had employees rate and mark this at the beginning. In addition, there were vouchers for each review submitted", he explains. For short reviews there used to be five, for longer ones ten euros - up to 50 euros per person in total.

Creating content portals yourself

Expertise as a retailer and a strong community in your own shop are important. But since some product categories - especially expensive musical instruments - are based on one-time purchases, Thomann must constantly win a lot of new customers. These are responsible for 350 million euros in sales per year. "We have about two and a half strategies. In total, however, we always look at where our customers are and meet them there," says Sven Schoderböck. "Central elements are music magazines, forums, social media channels. And if there is no 'elsewhere', we create it ourselves. We just bought a forum again." Thomann thus becomes a content provider itself in many places. As early as 2014, the company bought the publisher and content producer Wizoo Publishing, for example. Under its umbrella appear the comparison sites kopfhoerer.de and pianoo.de, for example. This is complemented, among other things, by recording.de, the largest forum for music production in Germany.

In its forums, Thomann also repeatedly points out its own actions

Other content offerings under the Thomann umbrella include music portals such as Bonedo, Amazona, Gearnews and DJ Lab. In addition, there are the forums Musiker-Board and Bassic. The Musiker-Board is considered the largest music forum in Germany with over a million visits per month (according to analysis tool SimilarWeb). With all these content portals, Thomann has created inventories or can place affiliate links. For example, under the piano tests at pianoo.de links to the products on Thomann are placed. In forums like Musker-Board, references to actions at Thomann keep popping up among the top articles. But at kopfhoerer.de, for example, also Amazon links are used.

Adtech also in-house

But that's only strategy one out of two and a half checked off. Presence on external platforms is just as important for Thomann. "Extremely important is the direct collaboration with publishers: We place ads with many, often we also work with affiliate agreements", says Sven Schoderböck. "And the rest is adtech. We had to develop our own stack for this, which can handle the assortment." In addition to the huge assortment, the international business is a major challenge for the in-house developed technology. "Especially for international customers, you need special adtech. We work with products in 2,000 categories, from over 2,000 brands and need campaigns in 18 languages. This can only be done automatically."

The team's goal is to quickly replicate successful campaigns in all languages and markets. Retargeting does not play a prominent role here because the interests of customers are so different after a purchase. Someone who buys an expensive guitar, for example, will not be interested in another guitar for the time being. Overall, however, Thomann counts on many convinced buyers returning on their own. "Making music is like cooking a passion. We don't need to remind people of that all the time," says Schoderböck.

The right partnerships

Still missing is the half, or perhaps rather the third major marketing strategy from Thomann: Influencer and Social Media. "Most new customers come via social media and Youtube - or via multipliers for example in forums. These specialists are asked, are opinionated and help enormously in the decision making of customers", says the Thomann VP. "Close cooperation with multipliers is ultimately also protection against Amazon and clear competitive advantage." On the one hand, the music store offers artists and professionals from the scene a platform on the Thomann channels to show, for example, guitar exercises or their DJ setup - mostly in videos. Youtube (almost 47,000 followers), Instagram (277,000 followers) and Facebook (378,000 fans) are in focus. In the future, this content strategy should be expanded significantly: "We have recently experimented a lot on Youtube and are now building two more Youtube spaces at the company's headquarters. We recently opened a studio in Berlin and one in Cologne where we produce content", Sven Schoderböck tells.

Thomann is also found on influencer channels. Often the company uses affiliate links here to measure the success of Youtubers, for example. These present a product available at Thomann in videos, for example, and refer to the dealer's website under the video. Exemplary example of this is Youtuber Henning Pauly alias EytschPi42. Under his videos he links to his own influencer page in the Thomann shop. There, instruments and devices that he keeps showing on Youtube are stored. If someone buys via this page, 4.5 percent of the price goes to the Youtuber (according to Thomann's own developed affiliate solution).

The influencer shop of EytschPi42 on Thomann.de

"In some cases, we also work closely with influencers and develop joint products via our own brands", says Schoderböck. This then resembles more classical influencer deals. Youtuber EytschPi42 even designed his own guitar with the Thomann brand "Harley Benton" – it costs 399 euros and is currently sold out.

Gearing up for the future

These strategies combined make Thomann a constant port of call for musicians and people from the event industry. And with closed music stores in city centers, this trend has intensified even further during the Corona pandemic. "We certainly count among the winners of the pandemic and had problems keeping up with the merchandise right from the start in 2020", says Sven Schoderböck. For the first time Thomann crossed the billion sales in 2020. However, depending on the behavior of the users, the team currently has to adjust its algorithms more often than before the crisis.

And then there's still Amazon - also apart from an analysis of competition. "Having a presence on Amazon is a permanent issue for us. Simply so that we don't miss anything and don't leave any gap open. But we can't manage that in financial terms because the margins are too small", explains Schoderböck. So the over 20 own brands from Thomann will also continue to only be available at the music store. And becoming a marketplace ourselves is currently not an option. Why should the market leader lead other players to their own customer base? Instead, Thomann could become a platform in other ways - via ad models (retail media), direct sales by brands or other types of services. We will observe what happens in the Franconian province.