Steinway tries to hit the right notes on the keyboard

Wei Wei says Steinway pianos have been experiencing double-digit sales growth in China, and believes the trend will continue for the next five years. Provided to China Daily

Piano maker sees urbanization as playing to demand of its products

German luxury piano maker Steinway & Sons is banking on the close links between music and urban entertainment to hit the high notes in China.

Steinway, which entered China in 1999 with a representative office in Beijing, has since then kept pace with the country's rapid urbanization and now has a presence in more than 25 Chinese cities. Steinway & Sons, a 159-year-old company with headquarters in Hamburg and New York, has six divisions around the world. Sales last year reached $216.8 million for 2,001 instruments.

Wei Wei, general manager of Steinway Piano (Shanghai) Co Ltd, says urban parents have been the biggest props for the company's rapid growth in China.

"Chinese parents are becoming increasingly aware that in modern society along with education, children also need specialized skills. Since piano playing is considered a specialized skill, we find that there is a growing interest in learning it," Wei says.

"At the same time, pianos are also becoming popular with urban dwellers as an ideal tool for relaxation, especially in cities where the pace of life is really fast."

According to Wei, some Chinese also play the piano for self-entertainment. "These are people who are successful and extremely busy and consider piano playing an emotional pursuit that is in tune with their high incomes," she says.

The piano is also becoming popular with urban dwellers in China who are retired and want to spend more time on hobbies. "Playing the piano is not just a way of passing time, but something that helps slow down the pace of life," Wei says.

The rising disposable income of urban households and more choices for consumer products in big cities also means that people are now more brand conscious.

Steinway pianos are high-quality products matched with exquisite craftsmanship and a keen eye for detail, thereby ensuring the best value for money, she says.

"We focus on brand differentiation because we want to be different from competitors in design, the materials used and the manufacturing process. What we try to do is to position our pianos at the premium end of each price segment," Wei adds.

Steinway's range of pianos in China include its standard ebony pianos; its customized art case pianos, which can cost millions of dollars; as well as the Boston, Essex and Lang Lang brands, which are designed by Steinway but made by other manufacturers in Asia.

Steinway's Crown Jewel collection of grand pianos, one of the company's most expensive ranges that sell for at least a million yuan ($163,000), has seen an annual growth rate in sales of 20 to 30 percent on the mainland.

The prices for the Boston line range from $16,000 to $57,000,. while the Essex is priced from $8,000 to $20,000. Lang Lang pianos are an exclusive brand designed for China that began in 2006, named after the famous Chinese pianist Lang Lang, who gave advice on the design and feel of the pianos.

Last year, Steinway also created its first commemorative piano in China, called Charm of the Dragon, which has an ancient dragon logo on one side of the body and Chinese calligraphy on the other.

Made to commemorate the Year of the Dragon last year, in collaboration with the Chinese antique expert Tian Jiaqing, the pianos were sold for 6.9 million yuan each at the China Guardian 2012 Autumn Auction in Beijing.

"There is immense potential in the Chinese market. This year, our piano sales have more than matched the forecasts. Although the current economic situation in China is not that ideal, we are optimistic on full-year targets. We believe that Chinese parents will not cut back on spending related to their children," Wei says.

She says Steinway pianos have been experiencing double-digit sales growth in China and believes the trend will continue for the next five years.

Wei says that Steinway's brand awareness is different in various Chinese cities and hence its marketing strategy also varies accordingly.

In bigger cities, the brand enjoys a high degree of recognition because top music schools often use the company's pianos, whereas in second- and third-tier cities, more efforts are needed on brand promotion because of the low visibility.

"What this means is that we need to focus and put more efforts into the second- and third-tier cities of China," Wei says.

"As China urbanizes rapidly, the demand for pianos in second- and third-tier cities will also grow rapidly. We anticipate huge opportunities in these markets."

To further expand into China's second- and third-tier cities, Steinway is focusing on training more piano technicians in these cities, so that customers turn to them for solutions.

She says that while it is not a major challenge to find local talent in these cities to repair pianos, it normally takes around three to four years for them to become master technicians who can repair Steinway pianos.

"When we form new partnership agreements with distributors, we also give them a lot of training and technical support, because our instruments are extremely specialized. We focus on training sales staff and technical staff, so they can provide a good service to customers," Wei says.

She says it takes a lot of skill and strategy to select good locations for stores in big cities such as Shanghai, Beijing and Guangzhou, so as to cover the entire population efficiently.

"We have to consider costs, target geographical areas and traffic flows, because the overall costs of running stores in big cities are very high," Wei says.

Currently, Steinway has about 10 stores in first-tier cities, including three stores in Beijing, two in Shanghai, one in Guangzhou and two in Shenzhen. The rest of its stores are in smaller cities, such as Zhongshan, Xi'an, Chengdu and Wuhan. Wei says Steinway is looking to expand store numbers in first-tier cities, and increase coverage of second- and third-tier cities.

At the same time, Steinway is also making inroads into building up people's perception of its brand. One way of doing so is to organize music-related events.

The company conducts a global piano competition for pianists aged below 17 years, once every two years. The latest competition attracted more than 4,000 pianists from China, with the winner being sponsored by Steinway to attend the International Steinway Festival in Hamburg.

"We hope to create a platform for young pianists to showcase their talent. The competition is not an end in itself, but rather a way to foster their interest in pianos," Wei says.

Steinway also hosts many music appreciation events across more than 20 Chinese cities, enabling a more general audience to appreciate the music.

"We also invite professional artists and musicians to give lectures about Steinway pianos, both on their physical appearance and sound, so that the average population can appreciate our pianos' beauty," Wei says.

She says Steinway considers these interactive events much more effective than advertising. "We advertise very little. Normally only in lifestyle magazines and luxury magazines. But it is hard to precisely target the right group of customers through advertisements," she says.

"Besides, it is best to appreciate our pianos by seeing, hearing and touching, because only this allows people to understand the craftsmanship that makes our pianos different from others."

Looking into the future, Wei believes that the Chinese will become increasingly sophisticated in their tastes, especially with regard to art and entertainment.