Steinway & Sons: Buying a Legend Harvard Case Solution & Analysis

COMPANY BACKGROUND:

Steinway & Sons was established in 1853 by Henry Engel hard Steinway. Steinway is recognized as a leader in high-quality grand pianos. Steinway has been operating since 140 years. Soon after the initiation of the business operations supported by innovative techniques, the piano manufacturing company was able to grow rapidly. The company, soon after its initiation, started to expand its operations into larger factories and manufacturing houses.

Moreover, the leader in the high-quality grand pianos is purchased by two entrepreneurs. The recent years have brought challenging times for the company. The worldwide demand for pianos is experiencing a constant decline and the competition for high-end pianos has increased. The main issues currently being faced by the two entrepreneurs are whether they should continue to focus on producing high-end grand pianos or develop a more aggressive plan for the mid-priced subsidiary BOSTON. With these decisions, they are finding it difficult to reason the acquisition made by them. Whether they add value to the 140 year old piano maker company or the efficiency level would stay stagnant.

RECOMMENDATIONS:

The entrepreneurial partners should focus on continuing to produce high-end pianos as well as establishing a stronger portfolio for the sub-brand named BOSTON. The company can increase the current market share by intensifying the marketing strategies and plans.

The newly launched mid-priced piano category named BOSTON can be continued by maintaining the brand name and leveraging the beginner brand through Steinway. Expansion of the organizations availability in different market will increase the potential market share of the company. Moreover, Steinway can expand its operations into the Asian Market.

The techniques for making handcrafted pianos have made Steinway famous. Steinway is strongly connected with its traditional ways of manufacturing pianos. This process provides pianos with a far better quality to the clients as well as, these pianos are high end that can resultin high revenues. With the continuation of manufacturing high-end grand pianos, Steinway can stay connected with its roots of making handcrafted pianos for a niche market at high prices.

The category of mid-price ranged pianos can add diversification to the portfolio of the company. BOSTON can act as a driver for attracting higher number of customers for the pianos manufactured. BOSTON will not be according to the quality standards of Steinway’s grand piano,as these would not be handcrafted and high-end therefore the prices would be low and reasonable to a different demographic segment of the market. BOSTON can be highlighted as a subsidiary brand to Steinway. Steinway can extend its operations into further detailed products as the company will be able to produce trademark handcrafted, high-end pianos for the niche market and mid-price ranged pianos for a different demographic segment of the market.Steinway & Sons Buying a Legend Case Solution

The company can enhance profitability and growth rate of the company by intensifying the marketing plans. Steinway can use its history with making pianos and how it has survived difficult times and still has been able to provide the music lovers with instrument. Marketing campaigns can highlight the connection between the company’s core piano making technique and the innovation that has been brought to the manufacturing process. The advertisements can be well directed if a celebrity piano player or musician is shown in the advertisements, hence taking the audience through the manufacturing process and the history of the company................................

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