It's not just the recession; the digital revolution has wreaked havoc on traditional music retailers, who can rarely match online juggernauts like iTunes or eMusic on price or convenience. "As of April," reports Amy Kaufman at The Wrap, "there were 185 record stores in the LA area, down from 259 at the beginning of 2007, according to the Los Angeles Times. The disappearing stores included everything from big chains like Tower and two Virgin Megastores to smaller independents like Rhino in Westwood and Aron's in Hollywood."

But despite this depressing trend, Amoeba Music—a large independent on Hollywood's Sunset Boulevard—continues to thrive. The reason? In addition to a vast inventory of new and vintage media, it gives customers something they won't find at iTunes—live performances by the likes of Elvis Costello, Paul McCartney and Mandy Moore.

"The events allow LA residents to feel connected," notes Kaufman, "and also allow music fans to share used items from their collections, co-owner [Marc] Weinstein believes." His customer base ranges from collectors who snap up classic vinyl to lower-income families who buy used VHS tapes. "All kind of culture is being recycled," he told Kaufman.

The message for downturn marketing here? These days, it pays to put on a good show. While Paul McCartney probably isn't going to play an in-store gig at your shop anytime soon, you can battle the recession—and online competition—by offering an irresistible in-store experience.

The Po!nt: Bring it on home. Drill down to what's unique about your online or brick-and-mortar store, and try creating a down-home customer experience around it. Shoppers may love the diversion.

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