The rise of radio and talking pictures in the 1920s competed with pianos for the public's attention and weakened the piano industry, and the Great Depression decimated it. During the Depression, many piano makers, both good and bad, went bankrupt, and their names were bought up by the surviving companies. Sometimes the defunct company's designs continued to be used, but often only the name lived on. Still, piano making in the 1930s, though reduced in quantity from earlier years, was in most cases of a similar quality.
To revive the depressed piano market in the mid-1930s, piano makers came up with a new idea: the small piano. Despite the fact that small pianos, both vertical and grand, are musically inferior to larger ones, the public decided that spinets, consoles, and small grands were preferable because they looked better in the smaller homes and apartments of the day. There has always been a furniture aspect to the piano, but the degree to which piano makers catered to that aspect from the mid-'30s onward marked a revolution in piano marketing.
During World War II, many piano factories were commandeered to make airplane wings and other wartime products, and what piano making there was fell somewhat in quality because of a lack of good raw materials and skilled labor. Things changed for the better in the postwar period, and you'll sometimes find used pianos from this period, still in reasonably good condition or needing some reconditioning, from such brands as Steinway, Baldwin, Mason & Hamlin, Sohmer, Everett, Knabe, and Wurlitzer.