Guitars, clarinets and ukuleles jazz up the walls of Vashon Island Music. A disco ball glamorously glitters in one corner. And displays are stuffed with rows of new and used CDs and records from artists new and classic, eclectic and top 40.

In 2004, when Karen Eliasen bought the shop and opened it as Vashon Island Music, she was counting on CD and vinyl sales as her bread and butter. But in the years since, the music industry has changed dramatically, and she has had to work hard to maintain her niche in an increasingly digital world.

As electronic media has taken the world of popular music by storm, CD and record sales have steadily dropped off at her store, she said. But rather than become obsolete, Eliasen diversified, offering instrument sales, rentals and a plethora of supplies for musicians at her store and renting out music studio space above her shop. This variety has kept her shop afloat, she said.

Like practically every business, the store is struggling, said Eliasen. But she remains upbeat about her shop’s prospects.

“It’s going to be a down year, for sure, but we’re thankful for every customer this season,” said Eliasen, a lifelong music lover who began playing the saxophone at age 8. “There’s too much great stuff that’s coming in the future to get too focused about the downturn.”

A former Microsoft employee, she opened Vashon Island Music in 2004 because she was seeking an on-Island job doing something she was passionate about. Today, she drives a few miles to her shop, from a home where she and her partner take care of about 175 unadoptable domestic animals through their nonprofit organization Baahaus — a time-consuming labor of love, she said.

Vashon Island Music has weathered the digital storm because the Island shop is not facing the same situation as music stores across the nation, according to Eliasen.

“Our boat’s heading in a completely different direction,” she said with a smile.

National sales of physical music like CDs plummeted more than 31 percent in the United States in 2008, while digital music purchases climbed 16 percent, according to the International Federation of the Phonographic Industry.

But Vashon Island Music isn’t seeing such a dramatic decline in its new and used CD and record sales.

“Though it’s dropped off to some extent, CD sales are still maybe surprisingly strong,” said Eliasen.

Eliasen’s store benefits when people “go digital,” she added, because they then sell entire CD collections to Vashon Island Music, enriching the store’s already eclectic and broad selection of used CDs.

“I don’t see any kind of us-versus-them mentality,” Eliasen said about digital media. “People come in here and speak in hushed tones about their mp3 players, and I say, ‘No, it’s all right.’”

Many of those who have gone digital still come to the store to buy CDs, she added.

“When you read about what’s happening with digital media and the need to change the model of producing and distributing music, that’s on a grand scale,” Eliasen said. “Vashon has nothing in common with any of that.”

She pointed to Vashon Island Music’s top 10 CD list as proof — Northwest musician Brandi Carlile tops the list, followed by Sting’s Christmas CD and an album by Pink Martini, a Portland band with a distinctive French flair. Vashon’s top 10 list almost never follows national trends.

“Sylvia (Matlock) plays Pink Martini at Dig, and people drive up here to get it,” Eliasen said. “And I find if we play something enough at the store, we can get it in the top 10.”

Islander Cathie Andersen said she shops at Vashon Island Music because she can get what she needs there and because Eliasen is a wonderful resource when it comes to music.

“I think people should pick her brain for good music,” Andersen said. “She’s got a great sense of what people like and can help you find music you wouldn’t know about otherwise.”

Mark Graham, an Island musician, concurred.

“Karen knows what people want and need, and she’s in touch with the popular musical sensibility,” he said. “I’m a woodwind player, and she always has the things I need — the cork grease and tea oil and things like that.”

If an item is not in stock at Vashon Island Music, Eliasen can order it and have it in hand quickly, Andersen added. Though Andersen owns an mp3 player, she buys CDs from Vashon Island Music regularly.

“I think CDs are a package — they’re intended to be a package, and it’s important to get the whole package and not just one song here and one song there,” she said. “It’s an art.”

Some of Vashon Island Music’s biggest moneymakers include ukuleles, guitar strings and other instrument accessories, Eliasen said. In recent years, Vashon Island Music has been one of the top non-Hawaiian sellers of ukuleles worldwide.

“I would think by now everyone has a ukulele on every lap, but people are still buying them,” she said. “It amazes me — they’re still pretty high on our list.”

For those who don’t wish to purchase a ukulele, guitar or clarinet, Vashon Island Music offers instrument rentals through a distributor in Redmond. Eliasen happily reports that it costs less to rent a high-quality instrument from her store than from an off-Island business.

About 15 instruments are currently being rented through Vashon Island Music, and Eliasen said she hopes that number will double in the next year. She’s working with Ken Quehrn, the band teacher at McMurray and Vashon High School, to drum up more instrument renters.

“If going off-Island to rent an instrument was going to be a barrier for a student being able to be in band, … I wanted to step up and take away any barrier to access,” she said.

In an effort to further support young musicians, Eliasen operates a music studio above her store where many take lessons. Though the studio isn’t hugely lucrative, “it pulls its own weight,” Eliasen said.

“She’s been really supportive of the studio, even though it hasn’t been profitable,” said Ken Jacobsen, who gives guitar, electric bass and cello lessons to more than 20 students in the studio above Vashon Island Music. “She’s very much behind teaching lessons. … The store is a good resource. I order all my music and stuff through there, and she’s very efficient about my requests.”

Vashon Island Music, however, is about more than its retail offerings, Eliasen said.

“Our specialty is the serendipity of the experience of this small music store — being surrounded by music you haven’t heard before, having your hands on an instrument you haven’t seen before,” Eliasen said. ”It’s different than browsing online; it’s different than walking into Walmart.”