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• Ikea Transnational Strategy

IKEA is the largest  furniture retailer in the world.  In 2017 IKEA had 2.3 billion visits to their website and 936 million visits to their stores.  All those visits resulted in 36.3 billion euros in sales.  In 2017 IKEA opened 14 new stores, bringing their total to 403 stores globally.   

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This case study of IKEA's transnational strategy provides insight into the company's strategy and operations. It highlights the company's aim to produce high-quality products at low prices to achieve a competitive advantage , drawing buyers' attention and increasing profitability. The success of the company can be attributed in part to the loyalty of its customers. This is evidenced by the number of young and price-conscious consumers who have bought into the IKEA concept. We will analyse Ikea's transnational strategy and the various challenges that IKEA has faced in its international expansion. This will reveal the company's solutions to specific problems and how their global strategy helped the company become one of the most successful furniture retailers in the world .

Before we get into the main discussion of IKEA's transnational strategy , let's find out about its history.

An introduction to IKEA

IKEA is a furniture and home décor company founded in 1943, in Sweden, by Ingvar Kamprad. After years working with furniture makers and suppliers, the young entrepreneur was able to establish a method that involved supplying furniture to be assembled directly by the customer in their home. The company started by developing innovative modular designs and sourcing components from Eastern Europe. The company then expanded throughout Scandinavia.

Stores were located in areas that could accommodate a large number of vehicles. The design and layout of the IKEA store remained the same throughout the years. The store's inventory is always large and customers can pick out their own furniture. In most cases, they do so without waiting for the store to deliver their order. F urniture can be assembled in various configurations, and the buyer can decide on the size and style of the pieces. Additionally, IKEA is a company that makes the purchasing journey an experience in itself.

INGKA Holding BV is the parent company of the IKEA Group companies. This includes the Swedish furniture retailer IKEA of Sweden, the industrial group Swedwood, which makes the furniture for IKEA, sales companies and the purchasing and supply functions relating to IKEA.

IKEA Transnational Strategy

There are four types of international business strategy: Global Standardisation Strategy, T ransnational Strategy, I nternational Strategy, and L ocalisation strategy (See Figure 1). The matrix emphasises two types of pressure faced by a multinational company when expanding abroad: local responsiveness and cost reductions.

Due to its poor performance in the 1990s, the company was forced to move to a transnational strategy that emphasises cooperation and interdependence of the home country's headquarters and its international subsidiaries and stores. To keep design and furniture at an affordable price, Ikea also adopts a global standardisation strategy so that its products, services, branding, and marketing strategies retain a level of 'sameness' everywhere. Some adaptations, however, are made to advertising and products offered in local markets.

The organisation of IKEA follows a matrix structure where each country has a Service Office (SO) and a national headquarter with support units. The SOs are responsible for the development and expansion of the stores in their local markets. Depending on the complexity of the project and the market conditions, Ikea may even choose to establish a country manager and a retail director for a country.

For IKEA, the importance of transferring corporate values, culture and concepts throughout their global divisions emphasises the need for knowledge sharing.

Knowledge sharing is the act of distributing existing knowledge from the headquarter to subsidiaries by a multinational firm.

The advantages of knowledge-sharing include:

Capitalising on market advantages of foreign operations (such as labour costs, proximity to natural resources, or shipping lanes)

Competitive edge in local markets

Organic, locally-driven decisions and organisational structure

Wide r market penetration and brand awareness

IKEA's knowledge sharing is primarily supported by a matrix organisational structure where each country's service office is linked to the Global Service Office at its core. Through this network, knowledge and information are shared throughout the organisation. Training also plays an important role in information sharing. Through onboarding programmes, each new employee is familiarised with the company's history, culture, and working methods. This is best reflected in IKEA's HR policy:

As an IKEA employee, you are willing to share your knowledge and experience with all IKEA employees.

Being an open company is another key factor, allowing IKEA to promote knowledge sharing among its employees. All the company's projects, important news, financial data, etc. can be viewed on bulletins and corporate newsletters.

IKEA's hybrid strategy

The IKEA hybrid strategy combines cost leadership and differentiation strategies. This allows companies to create differentiated products at low cost while still satisfying the expectations of their customers (see Figure 2 below).

The hybrid strategy is one where the company tries to gain two competitive advantages at the same time: low prices and high-quality products.

IKEA's strategy aims to achieve a competitive advantage by producing at the lowest cost. It allows the company to charge lower prices and increase profitability. To achieve its goals, IKEA cuts costs and is always looking for the least costly suppliers. It also tries to offer lower prices to its wider audience.

Differentiation strategy

To gain a competitive advantage, IKEA aims to offer products that are perceived as being different and better than their competitors.

The goal of the differentiation strategy is to create a compelling brand image by focusing on the quality of their designs.

Focus Strategy

The cost focus and differentiation focus are the two aspects of the company's main strategy.

IKEA uses a combination of these strategies to achieve its vision. One of the strategies it uses is its cost leadership strategy . This part of the strategy involves trying to produce at the lowest possible cost to maintain a competitive advantage.

To support its hybrid strategy, IKEA has a clear policy that applies to all of its activities, which incorporates elements of cost leadership and differentiation focus strategies. This policy is designed to ensure that the company's activities are carried out in line with its strategy, and is constantly improved.

Analysis of IKEA's transnational strategy

This section will analyse IKEA's transnational strategy and the various challenges that IKEA has faced in its international expansion. It will also reveal the company's solutions to specific problems.

An example of this is China, where IKEA opened its first store in Beijing in 1998. It took IKEA five years to understand the Chinese market, as the culture of Asia and Europe are very different. Below are the challenges that IKEA faced.

Challenges:

How to provide low prices and compete with local markets in China? High import taxes made it almost impossible for the company to offer low prices.

IKEA considered how to compete in China's cluttered market, where many local firms and products copied each other.

The low-income levels in China made it difficult to reach many people.

IKEA had to source local products and materials to compete with prices in China. This resolved the problem of high import taxes in China.

IKEA started performing local quality inspections, closer to the manufacturing stage, to save on repair costs and offer low price products in huge volumes. IKEA hoped to win over some of the competitors in the Chinese market.

IKEA targeted the young middle-class population as this category has a higher income and is more aware of Western styles. Targeting this segment helped IKEA project itself as an aspirational western brand.

Instead of using the IKEA catalogue to promote its products, they used Chinese social media and micro-blog website Weibo to target the urban youth instead.

One of the main challenges for IKEA in China was how to provide low prices.

This was a massive change in IKEA's strategy as it was targeting the mass market in other parts of the world.

Every year, IKEA conducts an annual survey to measure how consumers perceive the company's products and store layout. The goal of the survey is to find out if local adaptation is necessary to create the IKEA business concept, which is to create a better everyday life for many people by offering a variety of well-designed, functional products at prices that are as low as possible. In new markets, it is important to find a price level that is appropriate for the company and its customers. To attract people, the products offered must be perceived as good quality at low prices.

The challenges of IKEA's transnational strategy

IKEA is a very strong brand. Its strong brand identity, and its ability to attract customers, makes it stand out from its competitors. This is the reason IKEA is successful at achieving a hybrid strategy. However, challenges include reacting to changes in the environment, including the ability to deal with price wars. The external environment is IKEA's main threat. It can be measured using various factors, such as political, economic, social, technological and environmental factors.

Political refers to the various laws and regulations that affect a business.

Economic factors that affect businesses include interest rates, inflation, and exchange rates.

Social trends refer to the various changes that are happening in society. This includes the rise of the millennial generation and the decline of the baby boomer generation, for instance.

The level of automation and the technological advancement that businesses must adapt to are some of the factors that affect the profitability of businesses.

The impact of various environmental factors on businesses, like global climate change or health and safety laws.

To learn more about PESTLE, check out our explanation on external environments!

IKEA has faced many challenges along the way. One of them is uncontrolled child labour in countries that supply them with woven products. Due to the prevalence of child labour in countries such as India and Pakistan, the company has limited control of its suppliers. This issue usually affects the families and communities in these areas. So far, they have been unsuccessful in their attempts to control this issue.

IKEA's transnational strategy is inspired by the concept of combining high quality with low prices which adapts to a countries' needs. The company aims to produce furniture that is both functional and affordable. As a highly integrated company, IKEA, through its internalisation strategy, has been able to reduce costs and improve its overall product offering globally. This strategy and the many advantages it provided, were developed to compete against other furniture retailers and to grow globally. IKEA's strategy is to replicate its successful model in different markets. This can be achieved through the use of a transnational strategy.

IKEA's Transnational Strategy - Key takeaways

IKEA's transnational strategy is inspired by the idea of combining high quality with low prices. This way the company aims to produce furniture that is both functional and affordable.

IKEA is the largest furniture retailer in the world.

The company started by developing innovative modular designs and sourcing components from Eastern Europe.

IKEA uses a transnational and global standardisation strategy.

• IKEA follows a matrix structure where each country has a Service Office (SO) and a national headquarter with support units.
• The IKEA hybrid strategy combines cost leadership and differentiation strategies. This allows companies to create differentiated products at low cost while still satisfying the expectations of their customers

3. Riddhima Chopra, Ikea Case Study, Aeunike Lecture , 2009.

4. Warren Shoulberg, 'Why Ikea Succeeds Around The World While Other Retailers Falter', Forbes , 2018.

6. Eray Aydin, Ikea Knowledge Sharing, Slideshare , 2015.

Flashcards in Ikea Transnational Strategy 29

What is IKEA's international strategy?

Its concept is to combine high-quality design and functionality with low prices. Ikea's goal is to keep the prices low enough to allow the customer to buy the product directly. 

Is IKEA a transnational company? 

Does IKEA use standardization or adaptation? 

standardization

What type of global business is IKEA? 

IKEA is a global home furnishing brand that was started in 1943 by Ingvar Kamprad. It started as a mail order catalog business. 

Who is the founder of IKEA?

Ingvar Kamprad

In what year was IKEA founded?

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Frequently Asked Questions about Ikea Transnational Strategy

What is IKEA's international strategy?

To keep design and furniture at an affordable price, Ikea also adopts a  global standardisation strategy so that its products, services, branding, and marketing strategies retain a level of 'sameness' everywhere. 

Is IKEA a transnational company?

Yes, Ikea is one of the companies that follow transnational strategies.

Does IKEA use standardization or adaptation?

IKEA uses a global standardisation strategy.

What type of global business is IKEA?

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Inside IKEA’s Digital Transformation

• Thomas Stackpole

A Q&A with Barbara Martin Coppola, IKEA Retail’s chief digital officer.

How does going digital change a legacy retail brand? According to Barbara Martin Coppola, CDO at IKEA Retail, it’s a challenge of remaining fundamentally the same company while doing almost everything differently. In this Q&A, Martin Coppola talks about how working in tech for 20 years prepared her for this challenge, why giving customers control over their data is good business, and how to stay focused on the core mission when you’re changing everything else.

What does it mean for one of the world’s most recognizable retail brands to go digital? For almost 80 years, IKEA has been in the very analogue business of selling its distinct brand of home goods to people. Three years ago, IKEA Retail (Ingka Group) hired Barbara Martin Coppola — a veteran of Google, Samsung, and Texas Instruments — to guide the company through a digital transformation and help it enter the next era of its history. HBR spoke with Martin Coppola about the particular challenge of transformation at a legacy company, how to sustain your culture when you’re changing almost everything, and how her 20 years in the tech industry prepared her for this task.

• Thomas Stackpole is a senior editor at Harvard Business Review.

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IKEA Case Study

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How IKEA Evolved Its Strategy While Keeping Its Culture Constant HBR On Strategy

• Entrepreneurship

The Swedish furniture maker IKEA found huge success producing quality furniture at affordable prices. But in 2017, the company was at a crossroads. Its beloved founder had died, and the exponential rise of online shopping posed a new challenge. In this episode, Harvard Business School professors Juan Alcacer and Cynthia Montgomery break down how IKEA developed, selected, and embraced new strategic initiatives, while fortifying its internal culture. They studied how IKEA made big changes for the future and wrote a business case about it. They explain how the company reworked its franchise agreements to ensure consistency among its global stores. They also discuss how IKEA balanced global growth with localization, developing all-new supply chains. Key episode topics include: strategy, growth strategy, disruptive innovation, emerging markets, leadership transition, competitive strategy, company culture, succession. HBR On Strategy curates the best case studies and conversations with the world’s top business and management experts, to help you unlock new ways of doing business. New episodes every week. · Listen to the original HBR Cold Call episode: IKEA Navigates the Future While Staying True to Its Culture (2021) · Find more episodes of Cold Call · Discover 100 years of Harvard Business Review articles, case studies, podcasts, and more at HBR.org ]]>

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Table of Contents

Ikea target audience, ikea marketing channels, ikea marketing strategy, ikea marketing strategy 2024: a case study.

Become a Certified Marketing Expert in 8 Months

Ikea serves the unique functional needs of each target audience, with special attention to 16-34-year-old adults. It has solutions for:

• Single people not living at home
• Newly married couples
• Families with the youngest child under six
• Older married couples with dependent children
• No children families
• Labor force
• Professionals 

Thus, it uses the following types of product positioning :

• Mono-segment positioning. It appeals to the needs and wants of a single customer segment that is cost-conscious and prefers value for money.
• Adaptive positioning. It believes in periodically repositioning products and services to adapt to changes in customer preferences. Its Swedish furniture chain considers the dynamic nature of customer preferences. For instance, its latest products reflect increasing minimalism on the global scale. 

Ikea utilizes the power of the following marketing channels: 

• Mobile Application
• WebEngage: Email, SMS, and Whatsapp Marketing
• Social Media
• Telecalling
• Commercials

The Ikea marketing strategy contributes majorly to its success because it's original, imaginative, and distinctive while maintaining a transparent value proposition.

A Creative, Consistent Brand Theme

From the Swedish national colors on its buildings to rich meatballs in its store cafeterias, Ikea's marketing strategy reflects its cultural heritage proudly. It infuses all elements of their identity with a sense of self-assuredness that maintains their identity in the market of stiff competition. 

Emphasizing Affordability and Sustainability 

Understanding that a simple tiered strategy won't encourage repeat business, Ikea extends customization, flexibility, and mix-and-match furniture modules. It effectively combines the elements of affordability and sustainability in its marketing strategy to ensure success.

While the furniture options don't pledge a lifelong guarantee, the products are built to last. Even its reusable shopping bags reflect its commitment to sustainability.

Sponsorship and Influencers 

IKEA-sponsored comedic series Easy to Assemble. Its innovative content marketing was way different from a furniture product demo. Incorporating sponsored digital marketing campaigns and social media influencers have boosted the Ikea marketing strategy. 

Ikea’s Easy to Assemble Series

Exceptional In-store Experience

Ikea brilliantly displays products employing the best lighting systems to generate more sales. It strategically arranges best-matched items in mock rooms to encourage impulse purchases and inspire decor. The company also extends excellent customer service to provide a memorable experience and incite customers to come back for more.

Ikea’s Store Decor for Inspiration

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Website and Mobile Application Marketing

Ikea ensures an optimal mobile website's speed, button displays and gesture controls on its website and mobile app to retain and attract individuals to the site. It carefully invests in its UI/UX , enquiry-based chatbot, and regular updates on new offers, discounts, and promotions. 

One of the most successful marketing moves includes downloading its 3D modeling app to envision a dream home. It's one of its most successful marketing moves that allows IKEA to upsell its low-demand items by creating a desire in its customers to revamp the room.

Ikea’s Website With Engaging Content

Ikea's SEO (Search Engine Optimization)

Ikea's marketing strategy aims at enhancing the site's visibility for relevant searches to attract the attention of new and existing customers. It includes the right product-specific keywords and Google advertisements to further augment its organic ranking .  

Ikea Ranking for Bookcases on Google’s First Page

Ikea's SMM (Social Media Marketing)

Ikea's handles are very active on digital marketing platforms like Facebook, Instagram , Twitter, and Youtube . Their digital presence is impressive, with more than 30 Million likes on Facebook, 1 Million followers on Instagram, 5.3k followers on Twitter, and 41.2k subscribers on YouTube.

Ikea’s Instagram Profile

Its Instagram bio links to its website. The website also has links to its various social media posts. Its 'view shop' and 'call' options for product catalog and direct assistance, respectively, are a testament to a well-crafted Ikea marketing strategy.   

Ikea’s Youtube Advertisements 

IKEA also conducts free online workshops that lure lots of enthusiastic customers, resulting in gaining leads.

Ikea’s Online Workshop Ad

Content Marketing

Ikea relies on its content marketing strategy to create a distinguished presence amongst furniture brands. Its commercials, print ads, social media, and website stands out with attention-grabbing content. It combines innovation and humor to present the brand's core values and inspire people. 

Ikea’s Captivating Commercial 

Ikea Marketing Strategy bears testimony to a well-thought and structured marketing venture. Sign-up for our Digital Marketing Specialist and learn more about marketing case studies published by Harvard Business. You will be taught by experts from facebook and Purdue University. Sign-up for the course TODAY!

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IKEA Case Study| History of IKEA| IKEA Business Model

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August 31, 2019

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Ikea Case Study- (Business Model)

2 Minute Summary

IKEA is one of the biggest furniture companies in the world founded by a carpenter named Ingvar Kamprad who was 17-year-old, in Sweden in 1943. Everybody knows that Ikea offers the products at a very lower price than any retail shop. Ikea has invested 800 crores in India, It has more than 9500 Products and has more than 350 stores in 35 countries. the new store is spread across 400,000 square feet in the southern city of Hyderabad & plans to invest 105 billion rupees in India. the company is a non-profit. IKEA employs about 135,000 people. Because of tax rules for non-profits, IKEA pays about 33 times fewer taxes than their for-profit competitors. The Ikea trademark and the concept is owned by another private company named Inter Ikea Systems. It acquired TaskRabbit on Sep 28, 2017. IKEA has many mobile apps. But the most popular app is IKEA STORE. The app is having almost 9,60,333 monthly downloads. IKEA is the lead investor in 4 companies. Full Detail in Blog.

Everybody knows that Ikea offers the products at a very lower price than any retail shop.

In this blog, we’ll talk about Ikea Case Study(Business Model) as the Swedish furniture company opened its first retail store in India.

Like Walmart acquired Flipkart and entered the Indian Market. Ikea can destroy the Whole Furniture Market in India.

Ikea has invested 800 crores in India, It has more than 9500 Products and has more than 350 stores in 35 countries.

According to CNN , the new store is spread across 400,000 square feet in the southern city of Hyderabad & plans to invest 105 billion rupees in India.

But have you ever wondered? How does Ikea work?

What is the meaning of IKEA?

How IKEA works?

How IKEA business model earns ?

You must have many questions regarding IKEA, like What is the meaning of IKEA?

What is IKEA?

How IKEA earns?

This will be the most detailed case study on IKEA.

I will be answering all of your questions.

Let’s START WITH

WHAT IS IKEA?

IKEA is one of the biggest furniture companies in the world founded by a carpenter named Ingvar Kamprad who was 17-year-old, in Sweden in 1943.

IKEA is a globally renowned furniture retailer that sells ready-to-assemble furniture, kitchenware and home accessories.

 The company started with selling pens, wallets, jewellery with the concept of meeting consumers demands at the most affordable prices.

After five years into the business, IKEA brought in the furniture. Since then furniture has been the mainstream for the business.

IKEA furniture is now a well-known multinational brand.

IKEA MEANING

You must be wondering that what is the story behind the unique name the brand has.

The name IKEA isn’t just a fun.. it stands for – Ingvar Kamprad Elmtaryd Agunnaryd.

Short-form is cooler to pronounce right? But it actually has a deeper meaning.

The first two letters of IKEA i.e. I and K are the initials of the name of the founder Ingvar Kamprad.

While ‘E’ comes from the name of the farm he grew up on – Elmtaryd.

And the last letter ‘A’ comes from the Swedish village, Agunnaryd,

where the farm was located.

HOW IKEA EARNS? – IKEA BUSINESS MODEL

They follow Price-leadership model. Low prices are the main concern stone of the IKEA vision, business idea and concept.

In the world of IKEA furnishings, the products are named after Swedish towns like Aneboda, Akurum and Anordna.

But the costumers worry less about the names and care more about how much they cost.

Ikea furniture is a beacon for bargain hunters. Its whole business model evolves around selling their product at the lowest price possible.

IKEA business model revolves around their vision which is – offering a very wide range of well-designed, functional home furnishing products at so low prices that as many people as possible will be able to afford them.

Anybody can make a high-quality product for a high price, or a poor-quality product for a low price.

IKEA follows a different approach, they have developed methods that are both cost-efficient and innovative. Before designing the product… they decide the price tag.

Their designers begin with designing of the product after keeping the price in mind. The IKEA Group has 31 distribution centres in 16 different countries, supplying goods to IKEA stores. It has about 45 trading service offices in 31 countries.

They have very close relationships with their 1,350 suppliers in 50 countries.

IKEA’S SMART SECRET

Is IKEA – a Non- profit organization. ?

You must be having a lot of questions by now, like if IKEA is a non

profit organization then –

How do they manage their running cost?

Where all the money goes away?

Where does all this money earned is utilised?

You will get all your answer right away as you continue reading.

I would say a big YES,

IKEA has a little known secret: the company is a non-profit

They grew with a vision that states ‘to create a better everyday life for as many people as possible. And on a mission to offer a wide range of home furnishing products at a price so low that as many people will be able to afford them.’

Besides the vision and mission, the main motive of showing itself a non profit organization could seem as business-driven.

IKEA employs about 135,000 people. Because of tax rules for non- profits, IKEA pays about 33 times fewer taxes than their for-profit competitors.

There is one more big hole in this whole IKEA non-profit organization.

Money is not trapped inside Ikea’s foundation.

The Ikea trademark and the concept is owned by another private a company named Inter Ikea Systems.

So, to operate Ikea stores and use the brand name, the non-profit Ikea have to make payments each year to the private company – Inter Ikea Systems.

This clearly means money is paid directly from IKEA profits to the owners of this private company to license the trademark.

The beneficiaries or we can say owners of this private company are not publicly recorded, but it’s not hard to speculate that the Kamprad family is on the receiving end of this loophole.

HISTORY – STARTING AND GROWTH OF IKEA

Let’s talk about the exciting history timeline of IKEA.

From the of how it is started to the story of how it evolved exponentially.

It all started in 1926 when founder Ingvar Kamprad is born in Småland

in southern Sweden.

The 1940s-1950s

In the year 1948 – Furniture was introduced into the IKEA range.

Local manufacturers produced the furniture for IKEA in the forests close

to Ingvar Kamprad's home.

In the year 1956 – IKEA came up with the idea of designing furniture for

flat packs. It started focusing on self-assembling furniture models.

In the year 1980s – IKEA expands dramatically into new markets such

as the USA, Italy, France and the UK.

In the year 1984,

Ikea family was introduced a new club for the customers was launched.

Today, Ikea family is in 16 countries (over 167 stores) and has about 15

million members.

FINANCIAL FACTS AND FIGURES

Categories – Consumer Electronics, Furniture, Retail, Shopping, Smart Home.

Headquarters –   European Union (EU)

Founded Date –   1943

Founders – Ingvar Kamprad

No. of Employees – 10001 +

Legal Name –  IKEA BV

Digital links

Website –  www.ikea.com/

Facebook- www.facebook.com/IKEAIndia

LinkedIn – www.linkedin.com/company/ikea-group/

Twitter – https://twitter.com/IKEAUSA

Till now IKEA has only 1 acquisition.

It acquired  TaskRabbit  on Sep 28, 2017

Mobile app and its downloads

IKEA has many mobile apps. But the most popular app is IKEA STORE.

The app is having almost 9,60,333 monthly downloads.

Website and its monthly traffic IKEA is ranked 166 among websites globally.

And having almost 146,040,680 monthly visitors.

Investments

IKEA is the lead investor in 4 companies. Those are –

XL HYBRIDS – IKEA announced its investment in this company on

October 12, 2017

MAT SMART – IKEA announced its investment in Massmart on Jan

TRAEMAND – IKEA announced its investment in Traemand on Dec

LIVSPACE – IKEA announced its investment in Livspace on Dec 19,

MANAGEMENT AND THE CORE TEAM

CEO – Jesper Brodin

CFO – Alistair Davidson

FOUNDER – Ingvar Kamprad

HEAD OF CORPORATE FINANCE & TAX – Krister Mattsson

HEAD OF DIGITAL – Christian Moehring

HEAD OF E-COMMERCE, SOUTHEAST ASIA – Koen Besteman

HEAD OF UK MARKETING PROCUREMENT – Maria Malpartida

HEAD OF INNOVATION – Jens Heitland

8 IKEA Marketing Strategy

Many people confuse marketing with promotion. People believe that marketing is something you do to sell your product. But, this is not completely true. Marketing begins even before the production stage, as designing a product based on the demand and needs of the customers is also a part of marketing. This is what IKEA Believes in. Everything in IKEA is from a customer’s point of view. Let’s dive deep into learning different strategies of IKEA.

1. Amazing Customer Experience

Have you tried shopping from IKEA? If not, then I would strongly recommend you to try IKEA next time you need a piece of furniture.SHopping at an IKEA store is a different experience than shopping from any other furniture store. Whenever adults go out shopping with their kids, both the kids and parents face issues.

IKEA has got an amazing solution for this where none of them would feel any type of burden and in fact, both of them would like to spend more time at the IKEA store. Yes, I am talking about the free childcare facility provided by the IKEA stores. You can just leave your child safely with them and enjoy hustle free shopping and the child will also spend some quality time playing and making new friends.

Another amazing thing is that instead of standing and having a long discussion about which product to buy and calculating your cost, you can have a seat ad enjoy your paneer butter masala meal while discussing the furniture.

These little things not only add a value to the customers shopping experience but also give them a reason to visit again and even suggest others to visit the store.

2. Brand Identity

In such a competitive environment, is it very important to stand out or be unique and creative to survive? You have to build your brand in such a way that customers prefer you over other companies.IKEA is very strongly working with this. Its goal is to become the leader of every home.

IKEA focuses more on the product and the customers which a lot of companies fail to do. If you create what your customers want then you can build a good brand identity. Your every action should be a signal of your brand.IKEA uses this technique in its advertising. If you have been following IKEA for a while then you will not have to think a lot you can recognise directly that this is an IKEA ad.

3. Content Marketing

With the growing digital environment, the content has become an important element of the digital industry. Content is used by most of the companies to promote their product digitally. From a picture art to a long written blog anything can be used as content in digital marketing.

One of the best strategies you can use in this digital era is to interact with your customers directly.IKEA uses all types of contents to reach out to their customers. From images, videos to textual content IKEA has it all. To reach your customers digitally, it is very important to identify your potential audience, basically defining who your customers are. Then the most important step is defining how your potential customers can find you?IS is through your social media handles or is it through your website or a combination of all these. And then you need to target them both organically and by paid promotion techniques.

4. Social Media

Social media is something which cannot be avoided. Everyone nowadays uses social media, thanks to the internet revolution and jio revolution in India. Your presence on every social media platform is must, it doesn’t matter if you are an old company or a new one. Social media allows you to be in constant touch with your customers. You can use various strategies across your social media platforms that can help you create trust and a good brand image in front of your customers and also develop new customers.

There are a few strategies which you can follow.

• If you follow a consistent posting schedule, then you can have a good content interaction as regular posts can make your customers think about you.
• You can also use promotional strategies provided by social media companies to reach a new audience and attract them by telling them about your new products and offers.
• Another important feature of social media that you can use is to understand your audience. Understanding your audience is important because they are the ultimate consumers and having clarity about the consumers makes it possible for a brand to plan its products and marketing accordingly.

5. Innovation

IKEA is very famous for new designs and products. It keeps on constantly adding a new design or a new to product to its collection. This allows customers to visit the store even if they do not want to buy anything so that they can check the latest trends and products. If you check their social media handles, you will find a lot of different types of content that displays new and innovative products. This is a very good strategy as your customers stay updated with your products. Even if they do not add the products to their cark at the moment, they still add it to their wishlist. Which indirectly gets converted into sales. Thus, innovation in products and making innovation reach your customers is very important.

6. Creative Marketing Campaigns

IKEA is very creative when it comes to marketing. Their posts are so engaging that you want to click on it and see them that what is there. The example given below demonstrates how one will swipe right to see what they have for you. Isn’t it creative? If you observe, they have made good use of the present condition in a creative way. Similarly, a humorous and creative content strategy can help you get more engagements.

7. Amazing Use of Technology

Living in the 21st century, you can make amazing use of technology to provide a great experience to your customers. Augmented reality and virtual reality are some great examples of technology can you can use especially in such industries.IKEA makes use of both these augmented realities and the virtual reality

What is Augmented Reality?

This is the most amazing use of technology that IKEA could have done. With this, you can use your mobile phone to see how a piece of particular furniture would look at your home. You can also use this to decide at which corner of the house that particular furniture would look good. This is like a trial technology where you can try the products virtually at the comfort of your home without actually buying it. It is similar to something used by Lenskart.

What is Virtual Reality?

Yet another amazing use of technology. Where most of the people are busy using virtual reality for gaming purposes, IKEA has its smart use. Through virtual reality technology, IKEA allows its customers to feel the look of the furniture. For example, say you want to buy a modular kitchen, you can try the kitchen before actually buying it in a virtual reality headset. The most amazing part is that you can try cooking and get real experience.

8. Payments Methods

Consumers have become a lot more advanced than before. Customers need comfort. Since the evolution of the digital era, there are a lot of different methods of payment. Every consumer has different payment options. It becomes important to have all the options available so that the customers get a hustle free shopping experience. As already, IKEA is a price dominant company, best price with all modes of payments is like a cherry on the cake.

Unknown Facts About IKEA

• Ikea is the third-largest wood consumer on the planet. Being the leading furniture company it should not be shocking.
• IKEA is claimed to print more copies of its annual catalogue each year than the bible.
• IKEA has very good food sales. Being known for its furniture has a very good taste when it comes to their restaurant. This can be a great contribution to their revenue as they have an approximate sale of 2 billion annually.
• As in 2014, they have 716 million visitors to their store. This is a very huge number.
•  The first IKEA restaurant was launched in 1956 to feed its customers that would feel hungry after spending the whole day shopping.

SWOT Analysis of IKEA

* Its vision – ‘to create a better everyday life for many people’

* Economies of scale

* Lowest Price

* Countless designs

* Bad press

* Low quality

* Difficulty to control standards across locations.

OPPORTUNITY

* Solutions for a sustainable life at home

* Developing social responsibility

* The recession slows down consumer spending

* More competitors entering the low price household and furnishings

IKEA is one of the biggest furniture companies in the world founded by a carpenter named Ingvar Kamprad who was 17-year-old, in Sweden in 1943.

The company started with selling pens, wallets, jewellery with the concept of meeting consumers demands at the most affordable prices.

IKEA KEY VALUES

They are very strict about their values.

They firmly believe that every individual has something valuable to

Let’s look at some of there core values –

1. Cost – Consciousness

Their first priority is to make their product affordable to as many

people as possible. They challenge themselves constantly to make

the product more affordable without compromising on quality.

2. Renew and Improve

They always challenge themselves to try something new and to find a

a better way out.

3. Caring for People and Planet

They believe in caring for people as well as for the environment.

They act as a force for a positive change.

IKEA IN INDIA

In 2006, Ikea first displayed an interest in the Indian market but back then

the Indian laws allowed only 51 per cent foreign ownership.

With the government of India relaxing the norms for foreign direct

investment (FDI) in single-brand retail, IKEA announced in October

their intention to open stores in India.

IKEA opened its first store in India on Aug 9, 2018.

It took IKEA 12 long years to enter the Indian market.

The first store in India was opened in Hyderabad.

Hyderabad, the southern Indian city gave it a roaring welcome.

So far, more than 3 million customers have visited IKEA Hyderabad

store and about 8 million have visited IKEA’s India website

In the year 2016, Ikea purchased land in Mumbai and said that it planned

to open stores in Bengaluru and Delhi too.

After Hyderabad, in 2019 IKEA has launched its first online store in

Mumbai is offering more than 7,500 products.

It will provide delivery to most of the locations in Mumbai and will have

a delivery time of four to seven days, subject to availability and distance.

In India, IKEA currently has more than 55+ suppliers.

Also, have more than 45,000 direct employees and 400,000 people in the

extended supply chain.

Now, the company plans to have more than 25 stores in India by 2025.

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