• IKEA has Swedish roots dating back to the 1920s.• They have focused on high quality, functional, innovative, lowpriced home furnishings.• Over six decades, they have introduced products for everydayliving (not just furniture), broadening their brand’s meaning.• Sustainability has become an important part of their mission.• As of 2013, they have a presence in 40 countries.• Positioning• Key Marketing activities• Opportunities to Enhance• Brand Resonance• Brand Architecture• Brand Hierarchy• Market Channels• Growth Strategy
• Ingvar Kamprad starts sellingmatches to his neighbors.• He later begins sellingseeds, greetingcards, Christmas treedecorations, pencils, and pens.
• 1943 - IKEA founded when Kamprad is 17 years old. IKEA standsfor “Ingvar Kamprad Elmtaryd Agunnaryd.”• 1948 – Furniture was introduced. It was produced by localmanufacturers in the forests near Kamprad’s home.• 1951 – First catalog launched• 1953 – First furniture store opened in Sweden. This demonstratesthe function and quality of its low priced products.• 1956 – Furniture for flat packs and self-assembly are started• 1958 – First large IKEA store opens in Sweden
• 1960 – First IKEA restaurantlaunched• 1961 – IKEA began conductingproduct quality testing• IKEA expands intoDenmark, Switzerland, Norway, Germany, Australia, Austria, Canada, and the Netherlands
• 1984 –IKEA family is launched, IKEASTOCKHOLM range is launched, andthe catalog reached 45 million copiesin 9 languages• 1985 – IKEA arrives in the US
• 1990 – First IKEAenvironmental policy• 1997 – IKEA websitelaunched, Children’s IKEAlaunched, and IKEA 365 +launched (products for“preparing, cooking, serving, andeating food.”)• 1999 – 2000 – IKEA Foundationbegins. Donations to UNICEF forchildren in developing countries
• The best product doesn’t exist• Focus 100% on meeting customer expectations• A connection is forged from your assembly• Being the customer is a remarkable experience• Pleasantly surprise customers• IKEA’s prices are 30 - 50% below competitors• Target market: age 20 - 35IKEA vs. the competition:
• Image and functional-related considerations in terms ofbrand associations.• Leveraging of secondary associations (country of origin)• Product offeringsIKEA’s points of difference:• Category points of parity: home furnishings• Correlational points of parity: “High quality AND low price”• A key part of IKEA’s positioningIKEA’s points of parity:
• “Plant a Tree”• 100% renewable energyused in Sweden• Wind energy on the rise• Steam engine used fortransportation• 74% of all products arerecyclable• No more plastic• Many stores use solarpanels on the roofsEnvironmentally friendly company: Expanding the Line:• Move into otherspecified field• Consumers one-stop-shop• Introducing new lines ofproducts• – Televisions• – Food• – Beer (in Sweden)
• Store Inaugurations enhance the IKEA experience• Associations of their Swedish heritage adds credibility• Products assigned Scandinavian proper names• Consistency in global strategy and company mission and values• Limiting channels of distribution adds value to shopping at IKEA• Innovation on all levels• Revolutionizing product distribution• One-stop-shop• Passing savings onto consumers• Giving consumers products immediatelyKey Marketing Activities:
Opportunities to Enhance Positioning:• Increase awareness about social and environmentalresponsibility as a significant POD for IKEA’s brand andproducts• Introduce category extension with IKEA electronics• IKEA has such a unique offering that it is very hard forbusinesses to compete• Continue to build on the idea of improving the everyday life ofpeople everywhere
01002003004005006007008002008 2009 2010 2011 2012Number of IKEA Store Visits (Millions)Number of IKEA Store Visits(Millions)• Behavioral Loyalty-• Attitudinal Attachment- Austere Sensible Sustainable Simple Modern Responsible• Sense of Community- IKEA FoundationUnicefWWFSave the Children• Active Engagement- IKEA Share Space IKEA FamilyIKEA Share Space
Salience – Ready to make furnitureImagery:Trend settingCulturedEnvironmentally soundPerformance:PriceSimple designEasily serviceableFeelings:ExcitementSocial ApprovalJudgments:Credibilitythrough pricingResonance:Community forsaving space
• IKEA has managed their brand vision, boundaries, andpositioning well.• IKEA is a branded house – IKEA is the BRAND• IKEA has done a great job improving their brand image bytransferring equity between their products and services.Critique:• IKEA’s branded house helps make introducing new sub-brands lessdifficult as equity is easily transferred across product categories.Architecture:
Textiles&RugsBedroomKitchen&appliancesLivingRoomIKEAshoppingservicesChildren’sIKEAIKEA365+IKEAfurnitureIKEAFoodLightingCoffee& sidetablesTV +mediafurnitureStorageSofas&armchairs• Unlike P&G or Kelloggs vast brand portfolios, IKEA keepseverything under the IKEA umbrella.
• New markets– Expansions into international markets.– Growing internally.– The IKEA brand name is represented in more than 330 storesacross 40 countries.– Catalog has 160 million copies annually in over 25 languages• New channels– Didn’t go into other channels of distributions.– In 2000, took their products online.
• Growth Strategy- Good pace of introduction of IKEA into other markets.- Didn’t expand into new channels so they have morecontrol over their product.