Memo # 3: Steinway & A ; Sons
Steinway & A ; Sons’ laminitis wanted to “build the best piano possible and sell it with the lowest monetary value consistent with quality” . In making so, they are now seen as the leader in the fabrication of high quality Grand pianos. The company was able to thrive rapidly, due to their proficient high quality and their solid cognition of their mark market, value proposition, and competitory advantage.
Target Market: Steinway & A ; Sons’ mark market consisted of two different sections of consumers, private and institutional. The Grand pianos were targeted to wealthy, flush persons in the United States, specifically to those with an income over $ 100,000 and aged 45 and older who were interested in music and looking for something to showcase their wealth. The pianos were besides targeted towards instrumentalists, who wanted the best quality instruments. The 2nd section was establishments, like musical public presentation halls, hotels, and universities who besides wanted the best of the best when it came to musical instruments.
Value Proposition:Steinway & A ; Sons understands the importance of high quality, superior sounding Grand pianos that persons and professional instrumentalists likewise could systematically number on for supplying superior service. All Steinways are assembled by trade methods with small usage of assembly-line technique with merely the finest stuffs used and each one has its ain alone characteristics and sound. The award winning pianos are seen as being the best in the universe and serve as a position symbol stand foring a high prestigiousness among anyone that owns one.
Rivals:Although Steinway & A ; Sons face increasing competition from Nipponese piano makers like Yamaha and Kawai, every bit good as U.S rival, Baldwin, they have remained superior in the production of Grand pianos due to the lastingness of their merchandise, their advanced cross-stringing technique, the high quality stuffs used, along with the highly skilled labour who were employed throughout the production procedure. Unlike their rivals who utilized more mechanization processes when mass bring forthing their pianos, Steinways were assembled by manus, doing each piano unique and edifice merely a limited figure of hand-crafted pianos. This allowed them to be able to command higher monetary values than their competition every bit good as keeping the repute of being the best in the universe.
Recommendations for Steinway & A ; Sons:
Merchandise:Steinway’s chief merchandise was the Grand piano which is handcrafted and typically takes around two old ages to bring forth. Due to the intricate and long procedure of bring forthing the Grand pianos, the company was able to bring forth on norm, merely 3000 pianos in a given twelvemonth. Steinway increased their merchandise line to include Boston pianos, Limited Editions, and the Crown Jewel Collection. The Boston pianos were designed by Steinway & A ; Sons but manufactured in Japan by Kawai. These pianos sold for about half of a Steinway Grand piano. The Limited Edition Collection was a specially-designed piano, taging the 140Thursdayday of remembrance. It was so successful that they decided to present a Limited Edition piano every two old ages. The Crown Jewel Collection were traditional Henry steinwaies that were finished in alien forests like African pommele or East Indian rosewood and were sold at a premium monetary value of 20-30 % more than the traditional Steinways.
Steinway is a strong and sole trade name with a trade name individuality that majorly focuses on concert Grand pianos. They should go on production of these pianos and go on aiming instrumentalists and musical establishments and universities, while besides concentrating on distinguishing themselves from their rivals.
If Steinway wants to maintain bring forthing Boston pianos, they should set up it as a different trade name, distinguishing it from the Steinway trade name name. This needs to be clear to the client that they are two different trade names since it doesn’t make sense from a stigmatization point of view for Steinway to plan Boston pianos. They should aim the emerging Asiatic market with this piano, while bettering the distribution web in these markets through traders and so by opening their ain shops. The Limited Edition pianos were extremely successful and they should go on to bring forth those every two old ages every bit good as the Crown Jewel Collection.
Steinway should besides take advantage of the used piano market that is turning fast by offering trade-ins of used pianos on the purchase of new 1s. They can so re-sell used pianos every bit good as new 1s to increase their grosss.
Monetary value:Steinway’s Grand pianos are at the premium terminal of the piano market in footings of quality and monetary value. Retail monetary values in 1996 ranged from $ 30,000 to $ 111,000 in the United States.Many factors contributed to this high monetary value. Steinway pianos were assembled by handicraft methods with limited usage of assembly-line techniques which caused the Grand piano to take around two old ages to fabricate. The piano consists of over 12,000 single parts and the company had higher costs associated with high quality of natural stuffs used in the production.
Steinway has ne’er reduced their monetary values, and in maintaining with their high quality merchandise, they are able to command the highest monetary values in the industry, about dual that of their rival, Yamaha. In order for Steinway to be seen as a esteemed trade name, they can ne’er take down their monetary values or offer price reductions. This would be seen as dismissing the trade name and would be bad for their trade name image.
In order to make other persons who may non be able to afford the high monetary value of the Steinways, they should offer some sort of aid or loans to draw a bead oning instrumentalists. Besides, Steinway could aim the in-between category groups by supplying low-interest funding options or payment programs so other clients who may non be able to afford the pianos, could pay it off over clip.
Topographic point:Steinway’s merchandises are sold to professional and recreational instrumentalists, every bit good as orchestras and educational establishments, through its world-wide web of traders. The bulk of the company’s Grand pianos were sold in the United States, through Steinways’ gross revenues offices and a big web of independent traders. Customers purchase Steinway pianos either through one of the company’s retail shops in metropoliss like New York or London, or through independently owned franchises.
There is a immense, turning Asiatic market that Steinway has yet to aim. Their competition, Yamaha and Kawai have already taken over this market. It’s of import for Steinway to come in this market with their Boston pianos to vie with Yamaha and Kawai, and so easy present their high-end Steinway Grand pianos to this market. The Asiatic market is prevailing with persons with high disposable income, who would be interested in having a piano that comes with position and richness from the United States. They should besides look into spread outing internationally, like the Middle East, specifically Dubai or Saudi Arabia which besides has many persons with high disposable income.
In add-on to spread outing internationally, Steinway should believe about set uping a better online and digital presence and experiment with selling their pianos online. This would open them up to a younger demographic who use the Internet more on a regular basis to purchase merchandises, particularly higher-end merchandises.
Promotion:In the early old ages, Steinway promoted their trade name by constructing a big mill in New York where two chief Railroad autos passed by doing 1000s of people cognizant of the Steinway name. They besides opened Steinway Hall, which served as New York City’s chief concert hall. Steinway promoted its pianos with celebrated instrumentalists utilizing its “Concert and Artist Program” to pull top creative persons from around the universe. In any given twelvemonth, over 90 % of all classical music concerts featured a piano soloist executing on a Steinway Grand piano.
Steinway’s selling messages must be consistent with what the trade name stands for: richness and prestigiousness. Steinway’s advertisement has highlighted that one does non “ purchase ” , but “ invests ” in a Steinway, and that a Steinway piano is ever made merely a small spot better than necessary. Their advertisement emphasizes household values, the parts to art and music of Steinway & A ; Sons, and their proficient excellence. The dateless excellence of Steinway has ever been emphasized and it’s of import for Steinway to maintain up these selling messages.
Steinway’s trade name name is so widely known and popular, that they do non necessitate to make more trade name publicity since people are already so familiar with it and what it stands for. Steinway should go on to utilize instrumentalists who are loyal to the Steinway trade name in assisting advance their pianos. These instrumentalists could assist to advance to musical establishments or other draw a bead oning instrumentalists in the industry.
In add-on to trusting on celebrated instrumentalists for publicities, Steinway should look into developing concern partnerships with hotels and other amusement locales to expose merely Steinway pianos at their installations. They should besides venture into merchandise arrangement with films and Television shows, portraying the Steinways in movies and on popular telecasting shows. Non-musician famous person indorsements could assist them tap into consumers who are non familiar with the pianos, but want the prestigiousness of having something that other famous persons have.
Steinway should besides see utilizing other signifiers of publicity, like digital and on-line selling to acquire the word out about their pianos. They should leverage societal media and YouTube runs to aim to a younger demographic who may non be ready to buy one of their pianos yet, but will probably in the hereafter.
In decision, Steinway & A ; Sons should concentrate on the undermentioned recommendations. They should see bring forthing the Boston pianos under a different trade name name separate from the Steinway name and get down aiming the Asiatic market. They should go on to bring forth the Limited Edition and Crown Jewel Editions since they proved successful. Second, they should go on to command a high premium monetary value over their rivals, but look into offering funding or payment programs for the in-between category demographic, opening up their mark market and the potency for more gross. Third, Steinway should spread out internationally into the Asiatic and In-between Eastern markets to take advantage of an untapped turning market. Last, the company should experiment with different promotional avenues like merchandise arrangement, societal media, and famous person indorsements.
- Gourville, J & A ; Lassiter, J. ( 1999 ) . Steinway & A ; Sons: Buying A Legend, ( pp. 1-23 ) .