Steinway & Sons: Buying a Legend¢ñ. Statement of Problems and IssuesSummaryFor 140 years, Steinway & Sons has set the standard for manufacturing quality pianos. Why is Steinway a legend? What made him such a great teacher? After the first step into the piano industry, "Steinway" and the word piano are almost synonymous. Working with a long-term and ongoing technical and market strategy that emphasized quality, since the first members of the Steinway family arrived in New York from Germany in the mid-19th century, the company has pursued a strategy of creating high-quality products, selling them through its own lavish outlets and through a dealer network, and gaining visibility by encouraging leading artists to use the pianos. In the early 1970s, Steinway encountered competition from low-cost manufacturers based in Japan. Although Steinway's image and reputation were undisputed, the business was not particularly profitable. In addition to that, due to some shareholders who were not willing to invest but mainly interested in income, Steinway's financial condition worsened, so the family business ended and was sold to CBS. CBS acknowledged that the company did not fit its business strategy. In 1985, CBS sold the company to Boston-based investors John and Robert Birmingham. Under Birmingham, Steinway returned to its previous stature, emphasizing quality and focusing on the high-end market. But ten years later, Steinway was also sold to two investors, Kyle Kirkland and Dana Messina, due to financial problems. Problems and issues Now, the two young entrepreneurs have some questions and have to decide something important. Whether Steinway will continue to produce high-quality pianos or, alternatively, pursue some bolder and more aggressive plan? They would also have to decide what to do with the recently introduced Boston line of pianos. Did it make sense for Steinway to sell mid-priced pianos, and how can they leverage the Steinway brand to further increase revenue? Finally, what role should they play in Steinway's management? We will mainly focus our analysis on the market share, financial problem and brand strategy. Now we begin our analysis to choose the right creative to solve the dilemmas that Kyle Kirkland and Dana Messina are facing.¢ò. Analysis of the current situation1. External Analysis: Market and Competition, Consumer BehaviorDescriptionMarket Industry Trends1. Severe recession in the piano industry (global sales down 40% since 1980)2. Consolidation of the piano manufacturing industries in the US and EU3. Emergence of several Asian manufacturersThe used piano market1. The impact of an active market for used pianos is considerable2.