Yamaha Forecasts Growth At Annual “Kick-Off” Meeting
...by the entire company staff and culminated in an inspired performance by multi-platinum Grammy winner Sarah McLachlan and her band.
Hitoshi Fukutome, Yamaha Corporation of America president, led off the proceedings by offering congratulations to the entire staff for excellent results for the year ended March 31, 2015. “We achieved 100% of our sales budget, and beat last year’s sales by 5%. With m.i. markets growing just 1.5% last year and the consumer electronics market declining 2%, our sales performance well outpaced the industry averages. The good performance extended to gross margin. Our gross margin was higher than budget and last year.”
Yamaha’s market-beating performance was particularly noteworthy because it was achieved in the face of significant headwinds. A work stoppage at California ports in the fourth quarter led to acute product shortages and swollen back-orders for certain in-demand products. Additionally, the loss of duty-free “GSP” status on products imported from Indonesia led to significant cost increases on a range of pianos, band instruments, fretted instruments, and percussion products.
In addition to strong financial results, Fukutome highlighted other less quantifiable corporate achievements during the year. “On the marketing and branding side I was very impressed with how The Gift, our short film, resonated with our customers. The Facebook post, which coincided with merging our social media properties, became our most successful post to date, generating 160,000 video views, 2,000 shares and over 200 comments. I’m also happy to see continuous improvement in our end-user support. As you know, our customers rate our end-user support every day. This past year the customer support teams increased both overall customer satisfaction and the percentage of people saying they would recommend Yamaha by 4%. Finally, getting a Grammy nomination for the Nathan East album, just the third record on our label, was so great.”
Yamaha uses three yardsticks to measure the performance of its divisions: reven
ues, operating income, and inventory turn-over. Fukutome reported that the Keyboard division and the Band & Orchestral division both achieved the “trifecta,” beating projections in all three areas. All other divisions, Pro Audio & Combo, Consumer Electronics, and Services group outpaced sales budgets. In closing, he remarked, “We had a port slowdown. We had production delays. We had strong competitive challenges. All beyond our direct control. But we made the goal. We can still work together better, serve our customers at a consistently excellent level, and build an even stronger company.”
In a joint presentation, senior Vice Presidents Tom Sumner and Rick Young outlined an ambitious sales budget for the coming year, as well as several marketing initiatives designed to elevate the Yamaha brand. Sumner declared, “We’re doing everything we can to get closer to the customer.” Going into specifics, he detailed the “Meet 1,000 Customers Initiative,” a program where Yamaha engineers spend time with end-users to see how they use products and better understand their expectations.
Young explained that Yamaha was examining aspirational brands including Nike, Apple, and Starbucks to find ways to better burnish the Yamaha brand. One byproduct of this initiative was a pilot “One Yamaha” in-store experience that relies on extensive signage and point-of-purchase materials to explain that product quality that runs through Yamaha’s extensive product line. In the coming year, the company will also have a significant presence at events like Live Nation and Austin’s booming music fest, SXSW.
On the evening before the ceremony, Yamaha management paid tribute to outstanding performance with an elaborate awards ceremony. Each division presented an award to the district manager with the best sales performance, as well as a “Spirit” award to the team member who went above and beyond to serve customers and enhance Yamaha’s market position. Award winners this year included: Commercial Audio division: Spirit Award to Chip Allen, technical marketing group specialist; district manager award to Randy Weitzel. Pro Music Division: Spirit Award to David Cota, inventory & planning manager; district manager award to Neal Paton. Band & Orchestral Division: “Nan Tanker” Spirit Award to Ken Dattmore, marketing manager, strings; district manager award to Dino Riccio. Keyboard Division: Spirit Award to Simon Oss, marketing manager, Premium Piano; district manager award to Travis Mitchell. Audio Visual Division: Spirit Award to Michael Hine, product marketing manager; district manager award to Larry Tucker.
In his remarks to the assembled staff, Fukutome said, “I would like you to remember that our everyday jobs have a higher purpose. Our products, services, and people bring people the joy of making and enjoying music.” That joy was evident later in the evening when Sarah McLachlan and her band rocked Cerritos Performing Arts Center with a private performance. Alternating between a Yamaha CFX concert grand and a series of acoustic guitars in different tunings, the acclaimed songstress ran through a selection of new and old hits in a two-hour set. She also gave high praise to Yamaha for both the quality of its products and its corporate commitment to music education. “These beautiful instruments allow us to express ourselves fully,” she said. She also gave thanks to Yamaha for its ongoing support for the Sarah McLachlan School of Music in Vancouver, which provides instruction to 500 students at no charge.
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