Steinway & SonsBuying a Living Legend
Case Analysis
Strengths
1.Superior Brand among theWorld Stage
2.Proven excellence in technology
(3. 90% of all
Classical musicConcert are performed
onSteinway Concert Grand
Thanks to Birminghams
& Bruce Stevens
4.Quality reassured
Weaknesses
1.Financials a Setback
2.Poor Management when Undertook by the CBS
1972-1985
•Shuffling of CEOs•Increased dealers whose primary product not being a Steinway
3. Lost it’s Name and ReputationIn 1985
Quality? Being Questioned
740 finished pianos LanguishedAs dealers were reluctant to buy
Opportunities
1.Growing Asian Markets
2.Improving
Economic Conditions
@
U.S & Europe
3.4.5% increase in sales of
Grand PianosFrom 1990-1994 in
USA
4.58% of total Steinway are sold in
U.S
1.Steinway itself
Used pianos
2.Growing Asian markets
35% world’s vertical piano sales80% world’s grand piano sales
3.Yamaha owning 35% of World market
Sold 17,500 grand pianos
1.Stainway Grand sold For every
6.4 Yamaha Grand
That is,at a particular timeYamaha is making $203,724
While Steinway is making $41,020
Clearly Yamaha is on the upperside
32.5% Drop in Grand piano sales From the years 1990-1994
Thanks to Mid priced Boston pianos,
Steinway is stable
41% of the total unit sales
Strategy and Justification
Continue it’s High-end nicheStrategy
If not, •it looses it’s reputation•It has no match with Asian(80%) piano makers on production
Continue the Boston Piano Production
With a “Designed by Steinway”tag
Embedded On each piano
In-order to increase revenues
Utilize the production capacityAt the Asian industries
Nobody says no to patch upWith the Steinways
Aggressive Strategy must be Formulated to
Attract Asian Markets
One Such Strategy might be
Increase the variety of bostonPianos with the
“Designed by Steinway” tag
Most Grands the Asian makersSoldWereSmall
Hence, introducing low priced
Small GrandsWith a Steinway Design
tagMight Increase it’s sales
revenue
Kirkland as the chairman of the board
Major Strategy DecisionsRegarding Asian markets
On the otherhand,
Messina, must look upon US and Europe markets
Messina must
Interact with Dealers
Messina must put efforts to
Carry on Traditional SteinwayImage
1.Continue it’s High end niche Strategy
2.Continue the Boston Pianos
3.Strategic decisions regardingTie up with Asians
Introducing Low Priced
Grands
4.Kirkland and Messina Must understand
New demand realities&
Act Upon it
Thank you -by
Aswanth VaratharajanPSG College Of Technology