Friday, July 16, 2004
Mixed Signals: Crosley name still moves products, but is that a good thing?
Business Courier of Cincinnati - by Dan Monk Courier Senior Staff Reporter
The ghost of Powel Crosley Jr. is stirring on the Internet.
Just point and click your way to www.crosley.com, where you'll find Crosley's black-and-white visage smiling over an array of home appliances. Or surf on over to crosleyradio.com, where a Louisville-based firm markets retro radios, jukeboxes and telephones under the Crosley name.
Still not satisfied? Try eBay.com, where a Crosley search produces 411 products -- Shelvador refrigerators, a four-cylinder engine, even a 1940s television set, "Unit WORKS, sound and picture," for $250.
In fact, four decades after the death of Cincinnati's most famous entrepreneur, the Crosley name remains a potent and growing brand, generating more than $650 million in annual sales for Winston-Salem, N.C.-based Crosley Corp., which bought the Crosley trademark from Avco Corp. in 1977.
The company is negotiating new licensing agreements that could expand Crosley's reach to companies that sell furnaces, central air units and water heaters to home builders. One Crosley licensee, Louisville's Modern Marketing Concepts Inc., is generating revenue growth of 20 percent a year with Crosley-branded products. It recently introduced a new line of record players, called the Crosley Stack-O-Matic, and an Elvis Presley commemorative jukebox, which, through separate licensing agreements, bears both the Crosley and Presley names.
"In certain areas, (the Crosley name) still has brand equity, particularly in the Midwest. That's where our strength is," said John Colbert, executive director of Crosley Corp., a consortium of 39 independent distributors, whose history is chronicled in the new book "The Crosley Legacy."
The book is a collection of notes and press clippings from Buddy Dixson, a Carolina appliance distributor who bought the Crosley name in 1977. It's a tale that Crosley himself might have appreciated about a plain-talking salesman who bucked an industry trend and defied Avco's threats of a lawsuit over using Crosley's name.
But it's also a troubling tale to Crosley purists, who note that Crosley never made most of the products now being marketed under his name.
"The only thing he'd be happy about is that the Crosley name is still alive and well. That's all," said Dave Crocker, a Crosley collector in Cape Cod, Mass. "The radios aren't even old Crosleys. They're an imitation of an old Zenith design. The jukebox that they're selling was either an AMI or a Wurlitzer. The name Crosley is getting thinned out more and more."
Another Crosley aficionado, former WLW-AM 700 radio engineer Charles Stinger, frets that modern Crosley marketers have lost the "better costs less" mantra that Crosley preached.
"Crosley believed very much in products that could be produced at a lower price, so middle- to lower-class people could use them," said Stinger, a Hamilton resident who recently published a brief history of Crosley's manufacturing and broadcasting ventures in the '20s and '30s.
Stinger views Crosley as a civic giant who saved the Cincinnati Reds from bankruptcy and employed thousands during the Great Depression. It bothers him to think out-of-town companies are profiting from using the Crosley name.
"Crosley is Cincinnati," Stinger said. "That's where it belongs."
Crosley to Avco to Buddy
Never mind that Crosley himself helped it slip away by selling the Crosley Manufacturing Co. to New York-based Aviation Corp. (Avco) in 1945 for $22 million. By then, Powel Crosley Jr. was already a Cincinnati icon known for a string of innovations that included the world's first low-priced radio, the "Shelvador" refrigerator (the first to include shelves in the door) and the 1939 Crosley, a $325 car that got 50 miles to the gallon and resembled Chrysler's PT Cruiser. Crosley also was known for starting WLW radio, the "nation's station," and bringing night baseball to the Reds' Crosley Field in 1935.
During a Federal Communications Commission hearing on the transfer of Crosley's broadcasting licenses to Avco, Crosley said he feared "a forced sale" of his company following his death. He also said he wanted to focus more attention on his car business, which peaked with sales of 30,000 cars in 1948 but folded amid rising labor and materials costs in the early '50s.
By then, Avco was expanding its fleet of television stations and phasing out the home-appliance lines it acquired from Crosley. In 1956, Avco sold its appliance division to Ford's Philco division. In 1960, it removed the Crosley name from its defense-electronics division. Crosley died in 1961. Avco exited the broadcasting business in 1975 and was itself acquired by Textron Inc. in 1984.
South end of a northbound horse.
The Crosley name might have perished forever if not for Buddy Dixson, a Winston-Salem, N.C., native with a penchant for R-rated aphorisms and background that included a dozen Duke University tennis titles and World War II service as a supply sergeant for the U.S. Army Air Corps.
In 1976, Dixson was president of Brown-Rogers-Dixson, a regional appliance distributor stunned by Ford's announcement that its Philco division would no longer produce refrigerators. Some 40 other Philco distributors were in a similar bind. None was large enough to get pricing and product support from manufacturers, who preferred to deal directly with large retail chains.
"The obvious answer was for us to band together into a buying cooperative and create our own brand, which could be put on any number of appliances," Dixson told Business Week in January 1977.
Dixson found that brand in his Carolina warehouse, where he still had merchandise left over from his days as a Crosley distributor in the 1940s. When he learned that Avco hadn't been using the Crosley name, he shipped an old Crosley refrigerator across state lines and registered the Crosley brand as his own.
Avco responded with a "cease and desist" notice from its patent counsel, Irwin Garfinkle. "Avco Corporation is the owner of the Crosley name," Garfinkle wrote in a 1977 letter to Dixson. "We strenuously object to its appropriation."