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Deconstructing
IKEA.com
Erin Moxley
STRATEGY
Waseem Bari
MARKETING
VALUE CHAIN
Natalie Chan
SOCIAL MEDIA
Derolyn P. Kinkead
INTRODUCTION
PERSONAS
Davide Sartori
WIREFRAMES
A Web Strategy Report - 07/13
P a g e | 2
AN
INTRODUCTION
IKEA 101
IKEA is widely recognized for its low-priced,
ready-to-assemble contemporary home
furnishings. As related on their site: “At
IKEA our vision is to create a better
everyday life…by offering a wide range of
well-designed, functional home products at
prices so low that as many people as
possible will be able to afford them.”
Equally commendable is IKEA’s
commitment to the environment; that is to
invest in both renewable energy and
energy-efficient technology to lessen their
impact on the planet. In addition, the
company champions social issues and
supports/funds charitable programs. For
this, IKEA’s vision and values has secured
them a loyal customer base within the 41
countries the store operates— which
averages some 500+ million customers
walking through its doors annually.
Know Thy Customer…
However, for IKEA to stay competitive and
to prosper in a draconian economy and
often fickle marketplace, they quickly
embraced the new technology based
economy and migrated to the web with the
objective of building a strong online
presence that takes advantage of customers’
ability to engage, interact, and even
collaborate with their organization and each
other.
To that end, this report generated from the
perspective of five individuals who have
differing shopping experiences at IKEA, will
reveal how they have adapted to stay
relevant in the digital/virtual world by
providing an in-depth analysis of their
online strategy, marketing programs, social
media interactions, and wire frames. Plus
we’ll provide insight on two specific
personas.
Long Live the Home
http://www.ikea.com/ca/en/catalog/categories/depart
ments/living_room/
P a g e | 3
STRATEGY
“You do your part. We do ours.
Together we save money.”
IKEA founders set out with a strategy to
create a chain of stores that could provide
simple alternatives to luxury furniture, and
the cost-conscious consumers were ready
for this innovative experience. Their mission
statement, “To offer a wide range of well
designed, functional home furnishing
products at prices so low that as many
people as possible will be able to afford
them.”
The IKEA that we know today began as a
simple catalogue. It later opened its doors
to their first showroom in 1953, and they
allowed consumers to touch and feel the
sleek new designs, seeing the durability and
high quality of the low-priced products. This
strategy proved fruitful for the brand;
consumers would choose the products that
delivered the very best value for their
money. Beginning to look at expanding
abroad, the IKEA knew that in order to
successfully enter in to foreign markets,
they would have to appeal to the masses
and differentiate themselves from already
established competitors such as Walmart
and Target.
The goals that these founding partners had
for the IKEA Company resonated over the
years with their continued global
expansions, bringing the Swedish designs in
to the homes of people worldwide. IKEA
had a disruptive approach to retail, that
would challenge and eventually change how
consumer’s shopped. However, in order to
properly advertise their differences from
other big-box stores such as Walmart, IKEA
had to engage the consumers, and educate
them along the way. They accomplished
this with their innovative design of products
and stores, then in 1997 IKEA launched
their online retail experience. It became just
as enjoyable to shop through their online
store as it is to be present in an IKEA bricks
and mortar establishment.
Similar to their in-store experience, the
layout of IKEA’s web design allowed
consumers to engage with the IKEA
products. With interactive room planners,
shoppers could see how each product will
look when laid out in a room setting. “With
online sales increasing 25% year-on-year in
2012 and clearly established customer
expectations in the UK, European and US
markets,” IKEA’s online presence is well on
track to catch up to the success of their
brick and mortar establishments. The in-
store and interactive “map” is accurately
depicted in this image here, showing that
the consumer experience is heightened by
their ability to be in control, and to be able
to self-select each product. This strategy
has helped IKEA to keep costs low, with
limited staff on hand to provide service. As
well, by adding in flat packed products,
customers must then transport and
assemble their purchases at home. Their
unique approach across all platforms is
what draws the customers back for more.
P a g e | 4
STRATEGY cont’d
With IKEA becoming a global company, they
had to appeal to each unique market and
culture, and adapt to each consumer
market accordingly. In North America for
example, a trending topic is that of
sustainability. Being a furniture
manufacturer, IKEA had to re-strategize and
provide sustainable and recyclable products.
Steve Howard, Chief Sustainability Officer at
the IKEA Group says,
“We believe that sustainability should not
be a luxury good – it should be affordable
for everyone. With over 770 million visitors
to our stores, we are excited by the
opportunity to help our customers fulfill
their dreams at home with beautiful
products that help them save money on
their household bills by reducing energy
and water use, as well as reducing waste.”
IKEA had to also develop a strategy that
catered to their ways of living by making
their furniture more accessible. The
creation of the mobile and iPad app allows
both targets to access IKEA products on the
go, at the famous low prices. Accessibility is
a reason that IKEA has grown to be such a
global competitor in the furniture market.
With IKEA continuing to expand in to key
emerging markets, their strategy will always
be one of accessibility, low-cost home
furnishing solutions, with an innovative in-
store experience.
Mapping Activity Systems
Shows how IKEA’s strategic position is
contained in a set of tailored activities
designed to deliver it.
See diagram.
P a g e | 5
MARKETING
Brand Management
The IKEA brand is the sum total of the
emotional and rational values that
consumers associate with the IKEA
trademark and the reputation of our
company. The brand image is the result of
over 50 years work by IKEA co-workers at all
levels all over the world.
Marketing Communication
The overall task of IKEA marketing
communication is to build the IKEA brand
and inspire people to come to the stores.
The IKEA concept builds on a relationship
with the consumer. Nine key messages are
used within the IKEA marketing
communication to build this relationship.
These are:
The IKEA concept is based on the market
positioning statement. "We do our part"
focuses on their commitment to product
design, consumer value and clever solutions.
By using inexpensive materials in a novel
way and minimizing production, distribution
and retail costs, their customers benefit
from low prices.
The IKEA product range is developed to be
extensive to have something that appeals to
everyone and to cover all functions in the
home. The products are modern not trendy
so they are practical enough for everyday
use.
IKEA is the home furnishing specialist- IKEA
products are functional and appealing; they
enable people to improve their home life
through practical solutions to everyday
problems.
Low price is not appealing unless it
represents good value for money. This is
where IKEA is able to make a real difference.
IKEA is committed to having a good
relationship with our suppliers and so we
are able to purchase good quality,
economically produced designs that are
bought in bulk to keep costs down. By
making all their furniture flat packed they
cut down on transportation and assembly
costs.
Function - IKEA products are based on a
functional approach to design. IKEA design
means products that are attractive,
practical and easy to use. They don't have
unnecessary features, they give genuine
solutions for specific home furnishing needs
and are made of the most suitable materials
for their purpose.
The right quality-IKEA products are
subjected to rigorous tests to make sure
that they meet national and international
safety standards.
Convenient shopping- The IKEA store offers
"everything under one roof", most of it
available for immediate take-away. IKEA
offers service where they need it, but
allows customers to make most of the
decisions themselves. This means that they
need to make it easy to choose the right
products by displaying them correctly,
describing them accurately and having a
simple returns policy.
A day out for the whole family- IKEA aims to
look after their customers by planning for
their needs. Not only do they provide
inspiration and ideas, but they also
encourage people to touch, feel and use the
products on display to see how they would
fit into their own home. They have new
P a g e | 6
MARKETING cont’d
products arriving all the time, seasonal
themes, play areas for children, special
events and a great value family restaurant.
Swedish IKEA, - The key IKEA messages all
have their roots in the Swedish origin of
IKEA.
Swedish furniture is light and fresh yet
unpretentious. The warm welcoming
Swedish style has become a model of
simplicity, practicality, and informality that
is now world renown.
IKEA Marketing Mix
To develop a marketing research approach,
a company will look to do a consumer
analysis, an industrial analysis, and develop
a marketing mix that will best suit the
organization and the consumer. “In a
consumer analysis, some areas to look at
are demographics, psychographics,
behaviors, and geographical consideration.
In an industrial analysis,
the company will do a competitor analysis,”
(Perreault & McCarthy, 2004). Every
organization has countless ways to try
meeting the need of his or her customers.
There are so many variables; a company
needs to be able to organize them to
simplify the selection for that organization’s
marketing mix.
All the variables are reduced down to four
basic variables:
1. Product
2. Place
3. Price
4. Promotion
All other variables will be listed under these
four variables. “All four Ps are needed in the
marketing mix, and in fact, should be tied
together,” (Perreault & McCarthy, 2004).
“This paper will discuss and describe the
elements of the marketing mix. It will also
describe how each one of the four elements
of the marketing mix impacts the
development of IKEA’s marketing and
tactics.”
1. Product
First of the four variables is the product.
Developing the right product for the target
consumer is the main area of concern
for this variable. Some products can be
tangible products that can be bought and
sold. However, not all products are that of
physical goods.
Many products that are offered to the
consumer are services. “Services can consist
of completing someone’s taxes, performing
yard work and landscaping, and legal
representation. The most important thing is
that the product or service satisfies the
customer’s needs,” (Perreault & McCarthy,
2004).
“Some examples of the product decisions
to be made are brand name, functionality,
styling, quality, safety, packaging, repairs
and support, warranty, accessories and
services,” (NetMBA, 2012).
2. Place
The next variable is the place. What good is
a product to the consumer if it is not
available when and where it is wanted and
needed? Decisions involving getting the
right product to the targeted consumer are
the area of concern of place.
P a g e | 7
MARKETING cont’d
The product reaches the consumer by a
channel of distribution. “A channel of
distribution is any series of firms (or
individuals) that participate in the flow of
products from producer to final user or
consumer” (Perreault & McCarthy, 2004). A
channel of distribution can be very short
and simple or much more complex,
involving different wholesalers and retailers
(Perreault & McCarthy, 2004). “Some
examples of distribution decisions include
distribution channels, channel members,
inventory management, warehousing,
distribution centers, order processing,
transportation, and reverse logistics,”
(NetMBA, 2012).
3. Price
In addition to developing the right product
and place, a company must also decide the
right price. “When setting the price of
the product, the marketing manager must
consider many variables. Some of these
variables include the price of the
competition in the target market and the
cost of the entire marketing mix,”
(Perreault & McCarthy, 2004).
Another important factor of pricing is the
reaction of the consumer to the price. If the
consumer does not accept the price, then
all of the other components of the
marketing mix are wasted (Perreault &
McCarthy, 2004). “Some other examples of
pricing decisions to be made are price
flexibility, price discrimination, bundling,
cash and early payment discounts, seasonal
pricing, and suggested retail price,”
(NetMBA, 2012).
4. Promotion
The last of the four marketing mix variables
is promotion. Promotion is concerned with
letting the target consumer know about the
right product.
Promotion can be focused on both
acquiring new customers and retaining
current customers. “Promotion can include
personal and mass selling, as well as sales
promotion. A blend of all of these methods
can help in the marketing success,”
(Perreault & McCarthy, 2004).
Personal selling involves direct
communication between the seller and the
consumer. It can happen face to face or by
phone and video conference.
“Mass selling involves communicating with
a large number of customers at the same
time. This can happen by utilizing forms of
paid and unpaid publicity,” (Perreault &
McCarthy, 2004).
“Some examples of promotion decisions
can include advertising, public relations
and publicity, and sales promotions,”
(NetMBA, 2012).
IKEA is company that strongly exhibits all
aspects of the marketing mix. There vision is
“to create a better everyday life for the
many people,” (IKEA, 2012).
IKEA offers a wide variety of quality home
furnishing products at low prices so that as
many people as possible will be able to
afford them. The IKEA brand is built on
encouraging customers to experience the
IKEA concept. “The company’s image is
contributed by what the company does,
says and the products they offer at the
price they are offered at,” (IKEA, 2012).
The marketing mix is shown throughout the
IKEA business and culture.
P a g e | 8
MARKETING cont’d
The IKEA product is what the company is all
about. The company offers a wide array of
home furnishing products for ever area of
the home. Their products are offered in
many different styles to give the consumer
the opportunity to find exactly what they
need.
IKEA’s brands speak volumes about the
culture with each item having its own
unique brand name with a Swedish flare.
Packaging is also a big IKEA selling point;
selling the majority of their product
unassembled so the consumer can
transport them all home without having to
arrange and pay for delivery.
Place is also a big IKEA strategic strong
point. Compared to other home furnishing
retailers, IKEA has a smaller amount of well
strategically place stores throughout the
United States and the rest of the world. This
leaves room for a lot of supply and demand.
Consumers flock from all over to visit IKEA
locations and purchase large volumes of
products. Since each IKEA location is its own
warehouse, customers can leave with their
furniture or arrange for short-term delivery.
Each IKEA location also keeps a large
amount of inventory in order to keep
merchandise available for the many
customers that come to their locations.
Price is also one of IKEA very strong
qualities. It is actually their claim to fame.
Because of how other variables in the
marketing mix are addressed, IKEA is able to
offer its products and services and much
lower list prices than its competitors. The
company also offers many discounts and
sales throughout the year to lower prices
even more on some of their most popular
items. IKEA also offers different credit and
financing options to allow more consumers
access to purchasing IKEA products.
IKEA has also bumped their Promotions in
the last few years. With the opening of
many more U.S. IKEA locations, the
company has started a completely new
national commercial ad campaign. The
commercial ads were developed to appeal
to the consumer that shows IKEA as a hip,
fresh solution to any home furnishing need.
The company also takes advantage of some
free publicity by donating time, service,
products, and funds to various local causes.
These types of promotion appeal to the
local market and show that IKEA is a large
integral part in the community.
IKEA utilizes all aspects of the marketing
mix to help make it one of the leaders in its
industry. Just like IKEA, all businesses that
offer products and services rely on the
marketing mix to develop the most
successful marketing and tactical strategies
possible. With the proper mix of product,
place, price and promotion, organizations
can most effectively provide the right
consumers right the right products at the
right places and at the best prices.
References:
1. IKEA. (2012, May 14). Products and materials. Retrieved
from
http://www.ikea.com/ms/en_GB/about_ikea/our_responsibi
lity/products_and_materials/index.html
2. NetMBA. (2012, May 14). The marketing mix. Retrieved from
http://www.netmba.com/marketing/mix/
3. Perreault, William D., & McCarthy, E. Jerome. (2004). Basic
marketing: A global-managerial approach. [University of
Phoenix Custom Edition e-Text]. : The McGraw-Hill
Companies. Retrieved from University of Phoenix, MKT421
website
P a g e | 9
VALUE CHAIN
“Each step in the manufacture of a product
or the delivery of a service can be thought
of as a link in a chain that adds value to the
product or service. This concept of a how
business fulfills its mission and objectives is
known as the value chain” (Needles et al,
2007, p.836)
The concept of Value-Chain analysis is
introduced by Michael Porter (1985), who
divides activities of the firm into two
categories: primary activities and support
activities. Primary activities are necessary
elements for producing the products and
offering services, and support activities
assist businesses to become successful in
the marketplace.
These include, firm infrastructure, Human
Resource Management. Technology
development, and procurement. The
ultimate purpose of the firm is to add as
much customer "value" in each of the
primary activities (Pearce et. al, 1993: 184-
187).
Ikea has modified the value chain approach
by integrating the customer in the process
and introducing a two-way value system
between customers, suppliers, and Ikea's
headquarters.
In this global sourcing strategy, the
customer is a supplier of time, labor,
information, knowledge and transportation.
On the other hand, the suppliers are
customers, receiving technical assistance
from Ikea's corporate technical
headquarters through various business
services. The company wants customers to
understand that their role is not to consume
value, but rather to create it (Normann et
al, 1993: 67).
Ikea's role in the value chain is to mobilize
suppliers and customer to help them add
value to the system. Customers are clearly
informed in the catalogs of what the firm's
business systems provide, and what they
are expected to add to the final process.
In order to furnish the customer with good
quality products at a low cost, the firm must
be able to find suppliers that can deliver
high quality items at low cost per unit. The
headquarters provides carefully selected
suppliers with technical assistance, leased
equipment and the necessary skills needed
to produce high quality items.
This long-term supplier relationship does
not only produce superior products, but
also add internal value to the suppliers
(Normann et al, 1993: 72). In addition, this
value-chain modification differentiates Ikea
from its competition.
P a g e | 10
VALUE CHAIN cont’d
In-Bound Logistic
>Distribution of products to the stores
from 27 distribution centres
>“10,000 IKEA products are
manufactured by 2000 suppliers and
transported to the IKEA stores” (Berger,
2011, p.3)
>“Jobs in logistics account for about 20 -
25% of each store’s co-workers” (IKEA,
online, 2011)
Operations
>Operations in more than 38 countries;
208 company operated stores in 26
countries, remaining stores operated by
franchisees.
>IKEA does not manufacture its own
products
Out-Bound Logistics
>Transportation of products is done by
customers
Marketing and Sales
>Targeting mainly families with lower
income, students and singles
>Family-friendly environment within
stores
Services
>Very limited level of customer services
according to the chosen business
strategy
>Information to customers mainly
provided through explanatory
catalogues and displays
>Low number of sales assistants in stores
Support Activities
>Infrastructure
>Hierarchical tall organisational structure
>The IKEA Group is controlled by INGKA
Holding B.V. that belongs to Stichting
INGKA Foundation
>Stores are large in size
HumanResourceManagement
>High level of commitment to HR
practices
>Effective staff training and development
programs
TechnologyDevelopment
>Research and development activities are
initiated in Sweden
>Extensive use of information technology
in various business processes
Procurement
>No need for raw materials as IKEA does
not produce own brand products
>Long-term strategic relationships with
suppliers
P a g e | 11
SOCIAL MEDIA
IKEA’s Social Media Strategy
In 2009, Gordon Gustavsson, manager of
Malmo, Sweden’s new IKEA store created a
Facebook Account and now IKEA actively
has global Facebook accounts including
Canada, UK, USA and Australia. Since then,
IKEA has begun to cross promote with their
Pinterest boards, blog and twitter posts in a
continuous effort to tell their story over
different social media platforms.
Recently, IKEA has found itself caught up in
the horsemeat scandal and also affected by
the flooding in Calgary; it is the perfect time
to see how it is using social media to handle
these situations. IKEA also holds various
campaigns on its social media such as
“Tweet &Tidy” on twitter and “Pin to Win”
on Pinterest for further customer
engagement.
Tweet & Tidy campaign as posted on Facebook
https://twitter.com/ikeacanada
IKEA Canada Pinterest
http://pinterest.com/ikeacanada/
IKEA on Facebook
IKEA Canada’s Facebook post with an eye-catching image
of a room arranged with IKEA furniture
https://www.facebook.com/IKEACanada
IKEA Canada’s Facebook page is normally
updated once or twice a day with an eye-
catching image of a room arranged with
IKEA furniture. There is a decent level of
engagement, with posts generally achieving
a few hundred ‘likes’ and a number of
comments. The team is active in responding
to customer inquiries and complaints, but
generally quiet other than to inspire with
their daily updates. IKEA does a good job in
not talking too much about what they sell;
however, they occasionally throw in special
offers or campaign, but they keep it on a
moderate level.
P a g e | 12
SOCIAL MEDIA cont’d
Rather than offering discounts or attracting
followers by giving out oversized prizes such
as furniture for their homes, IKEA has a
unique way to reward their Facebook fans.
For instance, IKEA’s UK Facebook had a
group which gathered 100,000 people to
join and IKEA gave 100 of them the chance
to actually spend a night in the warehouse.
On the other hand, Australia held a
competition that gave one ‘lucky’ couple
the chance to get married at an IKEA store
on Valentine’s Day, with 80 Facebook fans
in attendance. Rewarding Facebook fans
with unique and original prizes is a great
way of sustaining an active online
community as it provides experiences they
cannot get elsewhere. Any retailer can give
away a bed or a new sofa, so there is more
value in terms of building brand loyalty if
you offer people something unique.
Facebook is not only used for contests or
campaigns, but IKEA also uses Facebook for
crisis management and information sharing.
For example, IKEA confirmed on its
Facebook page that it would stop the sale
of meatballs in Sweden and later withdrew
the meat from 14 countries across
Europe. Recently, the flooding in Calgary
has results in closing IKEA’s Calgary store for
safety purposes. As seen in the post below
on IKEA Canada’s Facebook, IKEA takes
responsibility to keep their customers and
staff up-to-date with the disaster:
“Our thoughts are with the residents of
Calgary during this difficult time. As the
safety and security of our customers and
co-workers is of the utmost importance to
us at IKEA, the Calgary store will close for
the day at 12:30pm this afternoon. We will
provide further updates regarding weekend
hours as information become available.
Please stay safe.”
IKEA’s Facebook team manages the
appropriateness of its content and the
Facebook page acts as a channel between
IKEA and its customers.
IKEA’s 2013 Catalogue APP
Wonder what the DUKEN setting will look in
your bedroom? Or cannot picture the red
or white BESTÅ BURS TV storage
combination suites your style? IKEA has
now solved the wondering minds and
allows a preview of the furniture in the IKEA
2013 Catalogue to see how it would look
exactly in your house. IKEA has
transformed a boring marketing material –
the IKEA catalogues – into a truly genuine
customer experience. IKEA’s new APP
allows its customers a chance to see how
their products will truly look like in their
homes.
Promo video of the IKEA APP shows the new experience
with a digital component to its annual catalogue
http://www.youtube.com/watch?feature=player_embed
ded&v=QQ8HNXtl7jQ
SOCIAL MEDIA cont’d
P a g e | 13
SOCIAL MEDIA cont’d
The famous IKEA catalogue, with its history
going back to 1951, is delivered into many
mailboxes around the world annually.
Starting 2013, IKEA added a whole new
experience with a digital component to its
annual catalogue. Customers can download
the IKEA Catalogue app which works on
smartphones and tablets and offers
consumers an augmented reality (AR)
experience which is fun as well as useful for
product knowledge.
Users simply launch the app and point their
cameras on the image to interact with the
printed catalogue pages that has a “phone
symbol” on it to unlock short movies,
interactive activities and more photos that
customers may mix and match. Most
customers would want see how their
homes will look before investing into pieces
of furniture and IKEA made it convenient
for them. IKEA’s new approach to its
catalogue can be a revolution to the
furniture shopping experience. The IKEA
APP is an appropriate addition to the nature
of IKEA’s core value and also to its products.
IKEA’s new APP is marrying the human
imagination, Instagram, Flickr and Pinterest
board all into one.
IKEA 365 Campaign Case Study
The IKEA 365 Campaign Case Study still runs on You Tube
today since 2011 http://bit.ly/ikrB4z
The 80/20 theory applies to every business
strategy. For example, McDonalds’s Big
Mac has always been 80 percent of its profit.
As for IKEA, which carries hundreds and
thousands of products and the catalogue is
overwhelming and even with the newly
introduced APP, how can IKEA ensure that
each item has received the same amount of
promotion? Lemz, an Amsterdam based
company which advertises “what you see is
what you get” came up with the right
solution for IKEA. Instead of focusing on
bedroom fixtures or kitchen cabinets, IKEA
recognises the importance of everyday life
at home. The company wanted to promote
the idea of everyday IKEA products and that
they bring happiness to those who uses
them every day. Lemz together with IKEA
decided to offer a new idea for the home,
every single day of the year.
The companies together launched a TV
campaign, which started in September 2010
and released a new commercial every day,
comprising of 365 commercials which
focused on a different IKEA product each
day. The 365 concept was extended in-
store, where each day a different product
was showcased. Online content was also
updated daily.
The IKEA 365 Campaign Case Study still runs
on You Tube today since 2011
http://bit.ly/ikrB4z. This is taking a step
further with traditional advertising to grace
each of the 365 products with the same
amount of attention. It may be one of the
most intriguing and successful digital
campaigns in the history of IKEA.
P a g e | 14
PERSONA 1
William and Katherine
Location: London, England
William and Katherine Mountbatten-
Windsor, both in their early 30s, are
newlyweds. After living the pauper’s life for
a year, they have saved enough funds for a
down payment on a flat in Kensington.
Eager to dispose of the antiquated furniture
they’ve inherited from family members, and
found on-the-cheap at thrift shops, they
have also set aside a small budget for new
furnishings. While this style-conscious
couple is desirous of achieving a
contemporary look for their new home,
they also are keenly aware of their limited
budget. They want style and value for their
money.
Processes
Social Media
Both William and Katherine are active users
on social media sites, namely Facebook, to
engage with the people, events and brands
that matter the most to them. They also
invite others to do the same. Together they
consult IKEA’s Facebook page to review
comments about the store made by peers,
notable interior designers and related
industry folk.
Impressed by the 301K LIKES and after
viewing a number of posts, they peruse the
flyer for current offerings and pricing.
Happy with the results of their findings,
they are resolved to go DIY and shop IKEA.
Style + Value = IKEA
Web Site
Now ready to engage in some online
shopping, William and Katherine visit
IKEA.com. They are immediately inspired by
the catalogue of photos as they move from
the kitchen to the bedroom to the
bathroom and then to the living room -
creating ideas for lounging, storing, playing
and entertaining in their space. They also
take advantage of the online shopping list
that prompts them to check stock
availability before they visit their local store.
Then, with tape measure in hand, they set
off to IKEA to make their purchases.
P a g e | 15
PERSONA 2
Sara, Bella and Rhys
Location: Toronto, Canada
Sara is a busy mother of two young children
(Bella 2, Rhys 4) and is due to have her third
child in five weeks. While her husband is
out of town on business, she is tasked with
preparing the house to accommodate the
new addition. However, with two growing
children, both who own a massive toy
collection, space is limited.
Having to juggle her time between home,
work and weekly doctor’s appointments,
Sara hasn’t the desire or the patience to
spend hours searching multiple furniture
outlets. She is looking for quick, easy
storage solutions but wants to make an
informed decision about her present needs
and long terms goals.
Processes
Mobile App
A sympathetic friend, who often shops IKEA,
suggests that she download their mobile
catalogue app. This time-saver will allow
Sara to view products in-between daycare
drop-offs, while commuting on the train,
and waiting in the doctor’s office.
IKEA Offers Creative
Storage Solutions
Web Site
Sara visits the web site and easily locates
the Children’s IKEA tab. She is comforted by
the numerous resources on how to:
>create a child-friendly home
>prepare for a new arrival, and
>customize storage solutions.
Sara chooses to CHAT LIVE with, Ask Anna,
the automated online assistant, who
reassures her about product safety and, if
unsatisfied, the online purchase return
policy.
Before long, Sara checks out her shopping
cart opting for home delivery. Then prior to
leaving the site, she subscribes to the
monthly newsletter.
P a g e | 16
WIREFRAMES
The IKEA wireframe can be analyzed from
the behavior of the following two personas:
a young couple and a mother of 3 children.
Persona 1
William and Katherine
William and Katherine decide to purchase
the furniture for their new house at IKEA,
because thanks to Facebook they
understood how IKEA is their best option
compared to many other companies, most
of all in terms of style and value.
After having read some posts and feedback
of the IKEA Facebook page they got really
satisfied about IKEA and its offerings and to
make the purchase there rather than in
other companies.
Their idea is to order the items that they
want to purchase throughout the IKEA web
site and then to go get them in person at
their nearest store location.
From the web site homepage they select
the country (United Kingdom) to figure out
where the closest location to them is, and
to better understand if they would have to
drive too much to get the items that they
ordered online. From the “Your local IKEA
store” they can easily see that there’s more
than one store close to them and decide to
select the one in Lakeside.
They go to the “Shop Online” link, under
“Customer Relations”, to understand how
the process of online purchase works with
IKEA.
Then, they decide to register their profile at
the “Login”; in this way they’ll be able to
save their items online once they decide
which ones they want to purchase. Once
registered, they start surfing the web site to
see what it offers, in particular in the
following sections: kitchen, bedroom,
bathroom and living room. They find the
photos in them very helpful, because they
can give a better idea of the items. They
also check out the “Summer offers” link to
see if there are other items that they could
be interested in and that were not listed in
the sections that they just check out. They
also want to see if these offers match the
ones that they found in the IKEA Facebook
page. They make their choices based on the
style that they are looking for and the value
that they attribute to the items. For each
selected item, they also check its stock
availability and size, in order to figure out
how it would fit in the new house.
After this research, they think that it might
be worth to take a look at the “Members
get more” link, to understand if in the
future they can benefit from IKEA through a
membership.
Once all this information is collected, and
their Shopping list has been double checked,
they go to the store that they selected at
the beginning to get the items that they just
ordered.
P a g e | 17
WIREFRAMES
Persona 1 – William & Katherine Mountbatten-Windsor
P a g e | 18
WIREFRAMES
Persona 2 – Sara Atherton
Sara is a very busy woman, as her children
and her job take most of her time.
She wants to buy some furniture for her
children and she decided to follow an
advice from a friend of her, who told her
that the IKEA App might be a good choice
for her. She realizes that this is actually a
great solution for her, because she’ll be
able to look for furniture while she’ll be
looking after her children.
The IKEA App, which is the digital copy of
the old IKEA catalogue, gives Sara a great
idea of what she is looking for and how
much she would have to spend. Most of all,
she can also see how the products that
she’s interested to would look like in her
house. For this reason, she decides to check
out IKEA web site and, in particular, the
“Children’s IKEA” link, which is located in
the main link menu. This section makes her
feel very comfortable, as it includes items
that might be very handy for her two
children (“Children” link) and the newborn
(“Baby” link) too. Even better, she can find
some extra useful information at the “Get
advice for creating a kid-friendly home” link,
here she can get rid of many doubts about
how the items that she’s looking for might
suit her children and baby’s needs. And
since Sara is too busy with her children, she
thinks that making the whole purchase
online will be the best idea. For this reason,
she wants to know how much the home
delivery expenses are for the items that she
selected. This information can be easily
found at the “Shop Online” link, under
“Services, shipping and return policy”.
The delivery expenses look good to her, but
there’s still one more thing she wants to
clarify, the return policy. She contacts “Ask
Anna”, the automated online assistant, and
clarifies her last few doubts.
At this point, Sara feels 100% comfortable
to make her purchase online at the IKEA
web site. She registers her profile at the
“Log In” area and purchases what she had
in her mind before.
This has been a great purchase experience
for Sara, who thinks that IKEA will still be
very helpful to her even in the future; for
this reason she decides to register to the
IKEA Newsletter to keep in touch with
future IKEA deals and promotions that can
be useful to her and her family.
P a g e | 19
WIREFRAMES
Persona 2 – Sara Atherton

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Deconstructing Ikea by Waseem Bari

  • 1. Deconstructing IKEA.com Erin Moxley STRATEGY Waseem Bari MARKETING VALUE CHAIN Natalie Chan SOCIAL MEDIA Derolyn P. Kinkead INTRODUCTION PERSONAS Davide Sartori WIREFRAMES A Web Strategy Report - 07/13
  • 2. P a g e | 2 AN INTRODUCTION IKEA 101 IKEA is widely recognized for its low-priced, ready-to-assemble contemporary home furnishings. As related on their site: “At IKEA our vision is to create a better everyday life…by offering a wide range of well-designed, functional home products at prices so low that as many people as possible will be able to afford them.” Equally commendable is IKEA’s commitment to the environment; that is to invest in both renewable energy and energy-efficient technology to lessen their impact on the planet. In addition, the company champions social issues and supports/funds charitable programs. For this, IKEA’s vision and values has secured them a loyal customer base within the 41 countries the store operates— which averages some 500+ million customers walking through its doors annually. Know Thy Customer… However, for IKEA to stay competitive and to prosper in a draconian economy and often fickle marketplace, they quickly embraced the new technology based economy and migrated to the web with the objective of building a strong online presence that takes advantage of customers’ ability to engage, interact, and even collaborate with their organization and each other. To that end, this report generated from the perspective of five individuals who have differing shopping experiences at IKEA, will reveal how they have adapted to stay relevant in the digital/virtual world by providing an in-depth analysis of their online strategy, marketing programs, social media interactions, and wire frames. Plus we’ll provide insight on two specific personas. Long Live the Home http://www.ikea.com/ca/en/catalog/categories/depart ments/living_room/
  • 3. P a g e | 3 STRATEGY “You do your part. We do ours. Together we save money.” IKEA founders set out with a strategy to create a chain of stores that could provide simple alternatives to luxury furniture, and the cost-conscious consumers were ready for this innovative experience. Their mission statement, “To offer a wide range of well designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them.” The IKEA that we know today began as a simple catalogue. It later opened its doors to their first showroom in 1953, and they allowed consumers to touch and feel the sleek new designs, seeing the durability and high quality of the low-priced products. This strategy proved fruitful for the brand; consumers would choose the products that delivered the very best value for their money. Beginning to look at expanding abroad, the IKEA knew that in order to successfully enter in to foreign markets, they would have to appeal to the masses and differentiate themselves from already established competitors such as Walmart and Target. The goals that these founding partners had for the IKEA Company resonated over the years with their continued global expansions, bringing the Swedish designs in to the homes of people worldwide. IKEA had a disruptive approach to retail, that would challenge and eventually change how consumer’s shopped. However, in order to properly advertise their differences from other big-box stores such as Walmart, IKEA had to engage the consumers, and educate them along the way. They accomplished this with their innovative design of products and stores, then in 1997 IKEA launched their online retail experience. It became just as enjoyable to shop through their online store as it is to be present in an IKEA bricks and mortar establishment. Similar to their in-store experience, the layout of IKEA’s web design allowed consumers to engage with the IKEA products. With interactive room planners, shoppers could see how each product will look when laid out in a room setting. “With online sales increasing 25% year-on-year in 2012 and clearly established customer expectations in the UK, European and US markets,” IKEA’s online presence is well on track to catch up to the success of their brick and mortar establishments. The in- store and interactive “map” is accurately depicted in this image here, showing that the consumer experience is heightened by their ability to be in control, and to be able to self-select each product. This strategy has helped IKEA to keep costs low, with limited staff on hand to provide service. As well, by adding in flat packed products, customers must then transport and assemble their purchases at home. Their unique approach across all platforms is what draws the customers back for more.
  • 4. P a g e | 4 STRATEGY cont’d With IKEA becoming a global company, they had to appeal to each unique market and culture, and adapt to each consumer market accordingly. In North America for example, a trending topic is that of sustainability. Being a furniture manufacturer, IKEA had to re-strategize and provide sustainable and recyclable products. Steve Howard, Chief Sustainability Officer at the IKEA Group says, “We believe that sustainability should not be a luxury good – it should be affordable for everyone. With over 770 million visitors to our stores, we are excited by the opportunity to help our customers fulfill their dreams at home with beautiful products that help them save money on their household bills by reducing energy and water use, as well as reducing waste.” IKEA had to also develop a strategy that catered to their ways of living by making their furniture more accessible. The creation of the mobile and iPad app allows both targets to access IKEA products on the go, at the famous low prices. Accessibility is a reason that IKEA has grown to be such a global competitor in the furniture market. With IKEA continuing to expand in to key emerging markets, their strategy will always be one of accessibility, low-cost home furnishing solutions, with an innovative in- store experience. Mapping Activity Systems Shows how IKEA’s strategic position is contained in a set of tailored activities designed to deliver it. See diagram.
  • 5. P a g e | 5 MARKETING Brand Management The IKEA brand is the sum total of the emotional and rational values that consumers associate with the IKEA trademark and the reputation of our company. The brand image is the result of over 50 years work by IKEA co-workers at all levels all over the world. Marketing Communication The overall task of IKEA marketing communication is to build the IKEA brand and inspire people to come to the stores. The IKEA concept builds on a relationship with the consumer. Nine key messages are used within the IKEA marketing communication to build this relationship. These are: The IKEA concept is based on the market positioning statement. "We do our part" focuses on their commitment to product design, consumer value and clever solutions. By using inexpensive materials in a novel way and minimizing production, distribution and retail costs, their customers benefit from low prices. The IKEA product range is developed to be extensive to have something that appeals to everyone and to cover all functions in the home. The products are modern not trendy so they are practical enough for everyday use. IKEA is the home furnishing specialist- IKEA products are functional and appealing; they enable people to improve their home life through practical solutions to everyday problems. Low price is not appealing unless it represents good value for money. This is where IKEA is able to make a real difference. IKEA is committed to having a good relationship with our suppliers and so we are able to purchase good quality, economically produced designs that are bought in bulk to keep costs down. By making all their furniture flat packed they cut down on transportation and assembly costs. Function - IKEA products are based on a functional approach to design. IKEA design means products that are attractive, practical and easy to use. They don't have unnecessary features, they give genuine solutions for specific home furnishing needs and are made of the most suitable materials for their purpose. The right quality-IKEA products are subjected to rigorous tests to make sure that they meet national and international safety standards. Convenient shopping- The IKEA store offers "everything under one roof", most of it available for immediate take-away. IKEA offers service where they need it, but allows customers to make most of the decisions themselves. This means that they need to make it easy to choose the right products by displaying them correctly, describing them accurately and having a simple returns policy. A day out for the whole family- IKEA aims to look after their customers by planning for their needs. Not only do they provide inspiration and ideas, but they also encourage people to touch, feel and use the products on display to see how they would fit into their own home. They have new
  • 6. P a g e | 6 MARKETING cont’d products arriving all the time, seasonal themes, play areas for children, special events and a great value family restaurant. Swedish IKEA, - The key IKEA messages all have their roots in the Swedish origin of IKEA. Swedish furniture is light and fresh yet unpretentious. The warm welcoming Swedish style has become a model of simplicity, practicality, and informality that is now world renown. IKEA Marketing Mix To develop a marketing research approach, a company will look to do a consumer analysis, an industrial analysis, and develop a marketing mix that will best suit the organization and the consumer. “In a consumer analysis, some areas to look at are demographics, psychographics, behaviors, and geographical consideration. In an industrial analysis, the company will do a competitor analysis,” (Perreault & McCarthy, 2004). Every organization has countless ways to try meeting the need of his or her customers. There are so many variables; a company needs to be able to organize them to simplify the selection for that organization’s marketing mix. All the variables are reduced down to four basic variables: 1. Product 2. Place 3. Price 4. Promotion All other variables will be listed under these four variables. “All four Ps are needed in the marketing mix, and in fact, should be tied together,” (Perreault & McCarthy, 2004). “This paper will discuss and describe the elements of the marketing mix. It will also describe how each one of the four elements of the marketing mix impacts the development of IKEA’s marketing and tactics.” 1. Product First of the four variables is the product. Developing the right product for the target consumer is the main area of concern for this variable. Some products can be tangible products that can be bought and sold. However, not all products are that of physical goods. Many products that are offered to the consumer are services. “Services can consist of completing someone’s taxes, performing yard work and landscaping, and legal representation. The most important thing is that the product or service satisfies the customer’s needs,” (Perreault & McCarthy, 2004). “Some examples of the product decisions to be made are brand name, functionality, styling, quality, safety, packaging, repairs and support, warranty, accessories and services,” (NetMBA, 2012). 2. Place The next variable is the place. What good is a product to the consumer if it is not available when and where it is wanted and needed? Decisions involving getting the right product to the targeted consumer are the area of concern of place.
  • 7. P a g e | 7 MARKETING cont’d The product reaches the consumer by a channel of distribution. “A channel of distribution is any series of firms (or individuals) that participate in the flow of products from producer to final user or consumer” (Perreault & McCarthy, 2004). A channel of distribution can be very short and simple or much more complex, involving different wholesalers and retailers (Perreault & McCarthy, 2004). “Some examples of distribution decisions include distribution channels, channel members, inventory management, warehousing, distribution centers, order processing, transportation, and reverse logistics,” (NetMBA, 2012). 3. Price In addition to developing the right product and place, a company must also decide the right price. “When setting the price of the product, the marketing manager must consider many variables. Some of these variables include the price of the competition in the target market and the cost of the entire marketing mix,” (Perreault & McCarthy, 2004). Another important factor of pricing is the reaction of the consumer to the price. If the consumer does not accept the price, then all of the other components of the marketing mix are wasted (Perreault & McCarthy, 2004). “Some other examples of pricing decisions to be made are price flexibility, price discrimination, bundling, cash and early payment discounts, seasonal pricing, and suggested retail price,” (NetMBA, 2012). 4. Promotion The last of the four marketing mix variables is promotion. Promotion is concerned with letting the target consumer know about the right product. Promotion can be focused on both acquiring new customers and retaining current customers. “Promotion can include personal and mass selling, as well as sales promotion. A blend of all of these methods can help in the marketing success,” (Perreault & McCarthy, 2004). Personal selling involves direct communication between the seller and the consumer. It can happen face to face or by phone and video conference. “Mass selling involves communicating with a large number of customers at the same time. This can happen by utilizing forms of paid and unpaid publicity,” (Perreault & McCarthy, 2004). “Some examples of promotion decisions can include advertising, public relations and publicity, and sales promotions,” (NetMBA, 2012). IKEA is company that strongly exhibits all aspects of the marketing mix. There vision is “to create a better everyday life for the many people,” (IKEA, 2012). IKEA offers a wide variety of quality home furnishing products at low prices so that as many people as possible will be able to afford them. The IKEA brand is built on encouraging customers to experience the IKEA concept. “The company’s image is contributed by what the company does, says and the products they offer at the price they are offered at,” (IKEA, 2012). The marketing mix is shown throughout the IKEA business and culture.
  • 8. P a g e | 8 MARKETING cont’d The IKEA product is what the company is all about. The company offers a wide array of home furnishing products for ever area of the home. Their products are offered in many different styles to give the consumer the opportunity to find exactly what they need. IKEA’s brands speak volumes about the culture with each item having its own unique brand name with a Swedish flare. Packaging is also a big IKEA selling point; selling the majority of their product unassembled so the consumer can transport them all home without having to arrange and pay for delivery. Place is also a big IKEA strategic strong point. Compared to other home furnishing retailers, IKEA has a smaller amount of well strategically place stores throughout the United States and the rest of the world. This leaves room for a lot of supply and demand. Consumers flock from all over to visit IKEA locations and purchase large volumes of products. Since each IKEA location is its own warehouse, customers can leave with their furniture or arrange for short-term delivery. Each IKEA location also keeps a large amount of inventory in order to keep merchandise available for the many customers that come to their locations. Price is also one of IKEA very strong qualities. It is actually their claim to fame. Because of how other variables in the marketing mix are addressed, IKEA is able to offer its products and services and much lower list prices than its competitors. The company also offers many discounts and sales throughout the year to lower prices even more on some of their most popular items. IKEA also offers different credit and financing options to allow more consumers access to purchasing IKEA products. IKEA has also bumped their Promotions in the last few years. With the opening of many more U.S. IKEA locations, the company has started a completely new national commercial ad campaign. The commercial ads were developed to appeal to the consumer that shows IKEA as a hip, fresh solution to any home furnishing need. The company also takes advantage of some free publicity by donating time, service, products, and funds to various local causes. These types of promotion appeal to the local market and show that IKEA is a large integral part in the community. IKEA utilizes all aspects of the marketing mix to help make it one of the leaders in its industry. Just like IKEA, all businesses that offer products and services rely on the marketing mix to develop the most successful marketing and tactical strategies possible. With the proper mix of product, place, price and promotion, organizations can most effectively provide the right consumers right the right products at the right places and at the best prices. References: 1. IKEA. (2012, May 14). Products and materials. Retrieved from http://www.ikea.com/ms/en_GB/about_ikea/our_responsibi lity/products_and_materials/index.html 2. NetMBA. (2012, May 14). The marketing mix. Retrieved from http://www.netmba.com/marketing/mix/ 3. Perreault, William D., & McCarthy, E. Jerome. (2004). Basic marketing: A global-managerial approach. [University of Phoenix Custom Edition e-Text]. : The McGraw-Hill Companies. Retrieved from University of Phoenix, MKT421 website
  • 9. P a g e | 9 VALUE CHAIN “Each step in the manufacture of a product or the delivery of a service can be thought of as a link in a chain that adds value to the product or service. This concept of a how business fulfills its mission and objectives is known as the value chain” (Needles et al, 2007, p.836) The concept of Value-Chain analysis is introduced by Michael Porter (1985), who divides activities of the firm into two categories: primary activities and support activities. Primary activities are necessary elements for producing the products and offering services, and support activities assist businesses to become successful in the marketplace. These include, firm infrastructure, Human Resource Management. Technology development, and procurement. The ultimate purpose of the firm is to add as much customer "value" in each of the primary activities (Pearce et. al, 1993: 184- 187). Ikea has modified the value chain approach by integrating the customer in the process and introducing a two-way value system between customers, suppliers, and Ikea's headquarters. In this global sourcing strategy, the customer is a supplier of time, labor, information, knowledge and transportation. On the other hand, the suppliers are customers, receiving technical assistance from Ikea's corporate technical headquarters through various business services. The company wants customers to understand that their role is not to consume value, but rather to create it (Normann et al, 1993: 67). Ikea's role in the value chain is to mobilize suppliers and customer to help them add value to the system. Customers are clearly informed in the catalogs of what the firm's business systems provide, and what they are expected to add to the final process. In order to furnish the customer with good quality products at a low cost, the firm must be able to find suppliers that can deliver high quality items at low cost per unit. The headquarters provides carefully selected suppliers with technical assistance, leased equipment and the necessary skills needed to produce high quality items. This long-term supplier relationship does not only produce superior products, but also add internal value to the suppliers (Normann et al, 1993: 72). In addition, this value-chain modification differentiates Ikea from its competition.
  • 10. P a g e | 10 VALUE CHAIN cont’d In-Bound Logistic >Distribution of products to the stores from 27 distribution centres >“10,000 IKEA products are manufactured by 2000 suppliers and transported to the IKEA stores” (Berger, 2011, p.3) >“Jobs in logistics account for about 20 - 25% of each store’s co-workers” (IKEA, online, 2011) Operations >Operations in more than 38 countries; 208 company operated stores in 26 countries, remaining stores operated by franchisees. >IKEA does not manufacture its own products Out-Bound Logistics >Transportation of products is done by customers Marketing and Sales >Targeting mainly families with lower income, students and singles >Family-friendly environment within stores Services >Very limited level of customer services according to the chosen business strategy >Information to customers mainly provided through explanatory catalogues and displays >Low number of sales assistants in stores Support Activities >Infrastructure >Hierarchical tall organisational structure >The IKEA Group is controlled by INGKA Holding B.V. that belongs to Stichting INGKA Foundation >Stores are large in size HumanResourceManagement >High level of commitment to HR practices >Effective staff training and development programs TechnologyDevelopment >Research and development activities are initiated in Sweden >Extensive use of information technology in various business processes Procurement >No need for raw materials as IKEA does not produce own brand products >Long-term strategic relationships with suppliers
  • 11. P a g e | 11 SOCIAL MEDIA IKEA’s Social Media Strategy In 2009, Gordon Gustavsson, manager of Malmo, Sweden’s new IKEA store created a Facebook Account and now IKEA actively has global Facebook accounts including Canada, UK, USA and Australia. Since then, IKEA has begun to cross promote with their Pinterest boards, blog and twitter posts in a continuous effort to tell their story over different social media platforms. Recently, IKEA has found itself caught up in the horsemeat scandal and also affected by the flooding in Calgary; it is the perfect time to see how it is using social media to handle these situations. IKEA also holds various campaigns on its social media such as “Tweet &Tidy” on twitter and “Pin to Win” on Pinterest for further customer engagement. Tweet & Tidy campaign as posted on Facebook https://twitter.com/ikeacanada IKEA Canada Pinterest http://pinterest.com/ikeacanada/ IKEA on Facebook IKEA Canada’s Facebook post with an eye-catching image of a room arranged with IKEA furniture https://www.facebook.com/IKEACanada IKEA Canada’s Facebook page is normally updated once or twice a day with an eye- catching image of a room arranged with IKEA furniture. There is a decent level of engagement, with posts generally achieving a few hundred ‘likes’ and a number of comments. The team is active in responding to customer inquiries and complaints, but generally quiet other than to inspire with their daily updates. IKEA does a good job in not talking too much about what they sell; however, they occasionally throw in special offers or campaign, but they keep it on a moderate level.
  • 12. P a g e | 12 SOCIAL MEDIA cont’d Rather than offering discounts or attracting followers by giving out oversized prizes such as furniture for their homes, IKEA has a unique way to reward their Facebook fans. For instance, IKEA’s UK Facebook had a group which gathered 100,000 people to join and IKEA gave 100 of them the chance to actually spend a night in the warehouse. On the other hand, Australia held a competition that gave one ‘lucky’ couple the chance to get married at an IKEA store on Valentine’s Day, with 80 Facebook fans in attendance. Rewarding Facebook fans with unique and original prizes is a great way of sustaining an active online community as it provides experiences they cannot get elsewhere. Any retailer can give away a bed or a new sofa, so there is more value in terms of building brand loyalty if you offer people something unique. Facebook is not only used for contests or campaigns, but IKEA also uses Facebook for crisis management and information sharing. For example, IKEA confirmed on its Facebook page that it would stop the sale of meatballs in Sweden and later withdrew the meat from 14 countries across Europe. Recently, the flooding in Calgary has results in closing IKEA’s Calgary store for safety purposes. As seen in the post below on IKEA Canada’s Facebook, IKEA takes responsibility to keep their customers and staff up-to-date with the disaster: “Our thoughts are with the residents of Calgary during this difficult time. As the safety and security of our customers and co-workers is of the utmost importance to us at IKEA, the Calgary store will close for the day at 12:30pm this afternoon. We will provide further updates regarding weekend hours as information become available. Please stay safe.” IKEA’s Facebook team manages the appropriateness of its content and the Facebook page acts as a channel between IKEA and its customers. IKEA’s 2013 Catalogue APP Wonder what the DUKEN setting will look in your bedroom? Or cannot picture the red or white BESTÅ BURS TV storage combination suites your style? IKEA has now solved the wondering minds and allows a preview of the furniture in the IKEA 2013 Catalogue to see how it would look exactly in your house. IKEA has transformed a boring marketing material – the IKEA catalogues – into a truly genuine customer experience. IKEA’s new APP allows its customers a chance to see how their products will truly look like in their homes. Promo video of the IKEA APP shows the new experience with a digital component to its annual catalogue http://www.youtube.com/watch?feature=player_embed ded&v=QQ8HNXtl7jQ SOCIAL MEDIA cont’d
  • 13. P a g e | 13 SOCIAL MEDIA cont’d The famous IKEA catalogue, with its history going back to 1951, is delivered into many mailboxes around the world annually. Starting 2013, IKEA added a whole new experience with a digital component to its annual catalogue. Customers can download the IKEA Catalogue app which works on smartphones and tablets and offers consumers an augmented reality (AR) experience which is fun as well as useful for product knowledge. Users simply launch the app and point their cameras on the image to interact with the printed catalogue pages that has a “phone symbol” on it to unlock short movies, interactive activities and more photos that customers may mix and match. Most customers would want see how their homes will look before investing into pieces of furniture and IKEA made it convenient for them. IKEA’s new approach to its catalogue can be a revolution to the furniture shopping experience. The IKEA APP is an appropriate addition to the nature of IKEA’s core value and also to its products. IKEA’s new APP is marrying the human imagination, Instagram, Flickr and Pinterest board all into one. IKEA 365 Campaign Case Study The IKEA 365 Campaign Case Study still runs on You Tube today since 2011 http://bit.ly/ikrB4z The 80/20 theory applies to every business strategy. For example, McDonalds’s Big Mac has always been 80 percent of its profit. As for IKEA, which carries hundreds and thousands of products and the catalogue is overwhelming and even with the newly introduced APP, how can IKEA ensure that each item has received the same amount of promotion? Lemz, an Amsterdam based company which advertises “what you see is what you get” came up with the right solution for IKEA. Instead of focusing on bedroom fixtures or kitchen cabinets, IKEA recognises the importance of everyday life at home. The company wanted to promote the idea of everyday IKEA products and that they bring happiness to those who uses them every day. Lemz together with IKEA decided to offer a new idea for the home, every single day of the year. The companies together launched a TV campaign, which started in September 2010 and released a new commercial every day, comprising of 365 commercials which focused on a different IKEA product each day. The 365 concept was extended in- store, where each day a different product was showcased. Online content was also updated daily. The IKEA 365 Campaign Case Study still runs on You Tube today since 2011 http://bit.ly/ikrB4z. This is taking a step further with traditional advertising to grace each of the 365 products with the same amount of attention. It may be one of the most intriguing and successful digital campaigns in the history of IKEA.
  • 14. P a g e | 14 PERSONA 1 William and Katherine Location: London, England William and Katherine Mountbatten- Windsor, both in their early 30s, are newlyweds. After living the pauper’s life for a year, they have saved enough funds for a down payment on a flat in Kensington. Eager to dispose of the antiquated furniture they’ve inherited from family members, and found on-the-cheap at thrift shops, they have also set aside a small budget for new furnishings. While this style-conscious couple is desirous of achieving a contemporary look for their new home, they also are keenly aware of their limited budget. They want style and value for their money. Processes Social Media Both William and Katherine are active users on social media sites, namely Facebook, to engage with the people, events and brands that matter the most to them. They also invite others to do the same. Together they consult IKEA’s Facebook page to review comments about the store made by peers, notable interior designers and related industry folk. Impressed by the 301K LIKES and after viewing a number of posts, they peruse the flyer for current offerings and pricing. Happy with the results of their findings, they are resolved to go DIY and shop IKEA. Style + Value = IKEA Web Site Now ready to engage in some online shopping, William and Katherine visit IKEA.com. They are immediately inspired by the catalogue of photos as they move from the kitchen to the bedroom to the bathroom and then to the living room - creating ideas for lounging, storing, playing and entertaining in their space. They also take advantage of the online shopping list that prompts them to check stock availability before they visit their local store. Then, with tape measure in hand, they set off to IKEA to make their purchases.
  • 15. P a g e | 15 PERSONA 2 Sara, Bella and Rhys Location: Toronto, Canada Sara is a busy mother of two young children (Bella 2, Rhys 4) and is due to have her third child in five weeks. While her husband is out of town on business, she is tasked with preparing the house to accommodate the new addition. However, with two growing children, both who own a massive toy collection, space is limited. Having to juggle her time between home, work and weekly doctor’s appointments, Sara hasn’t the desire or the patience to spend hours searching multiple furniture outlets. She is looking for quick, easy storage solutions but wants to make an informed decision about her present needs and long terms goals. Processes Mobile App A sympathetic friend, who often shops IKEA, suggests that she download their mobile catalogue app. This time-saver will allow Sara to view products in-between daycare drop-offs, while commuting on the train, and waiting in the doctor’s office. IKEA Offers Creative Storage Solutions Web Site Sara visits the web site and easily locates the Children’s IKEA tab. She is comforted by the numerous resources on how to: >create a child-friendly home >prepare for a new arrival, and >customize storage solutions. Sara chooses to CHAT LIVE with, Ask Anna, the automated online assistant, who reassures her about product safety and, if unsatisfied, the online purchase return policy. Before long, Sara checks out her shopping cart opting for home delivery. Then prior to leaving the site, she subscribes to the monthly newsletter.
  • 16. P a g e | 16 WIREFRAMES The IKEA wireframe can be analyzed from the behavior of the following two personas: a young couple and a mother of 3 children. Persona 1 William and Katherine William and Katherine decide to purchase the furniture for their new house at IKEA, because thanks to Facebook they understood how IKEA is their best option compared to many other companies, most of all in terms of style and value. After having read some posts and feedback of the IKEA Facebook page they got really satisfied about IKEA and its offerings and to make the purchase there rather than in other companies. Their idea is to order the items that they want to purchase throughout the IKEA web site and then to go get them in person at their nearest store location. From the web site homepage they select the country (United Kingdom) to figure out where the closest location to them is, and to better understand if they would have to drive too much to get the items that they ordered online. From the “Your local IKEA store” they can easily see that there’s more than one store close to them and decide to select the one in Lakeside. They go to the “Shop Online” link, under “Customer Relations”, to understand how the process of online purchase works with IKEA. Then, they decide to register their profile at the “Login”; in this way they’ll be able to save their items online once they decide which ones they want to purchase. Once registered, they start surfing the web site to see what it offers, in particular in the following sections: kitchen, bedroom, bathroom and living room. They find the photos in them very helpful, because they can give a better idea of the items. They also check out the “Summer offers” link to see if there are other items that they could be interested in and that were not listed in the sections that they just check out. They also want to see if these offers match the ones that they found in the IKEA Facebook page. They make their choices based on the style that they are looking for and the value that they attribute to the items. For each selected item, they also check its stock availability and size, in order to figure out how it would fit in the new house. After this research, they think that it might be worth to take a look at the “Members get more” link, to understand if in the future they can benefit from IKEA through a membership. Once all this information is collected, and their Shopping list has been double checked, they go to the store that they selected at the beginning to get the items that they just ordered.
  • 17. P a g e | 17 WIREFRAMES Persona 1 – William & Katherine Mountbatten-Windsor
  • 18. P a g e | 18 WIREFRAMES Persona 2 – Sara Atherton Sara is a very busy woman, as her children and her job take most of her time. She wants to buy some furniture for her children and she decided to follow an advice from a friend of her, who told her that the IKEA App might be a good choice for her. She realizes that this is actually a great solution for her, because she’ll be able to look for furniture while she’ll be looking after her children. The IKEA App, which is the digital copy of the old IKEA catalogue, gives Sara a great idea of what she is looking for and how much she would have to spend. Most of all, she can also see how the products that she’s interested to would look like in her house. For this reason, she decides to check out IKEA web site and, in particular, the “Children’s IKEA” link, which is located in the main link menu. This section makes her feel very comfortable, as it includes items that might be very handy for her two children (“Children” link) and the newborn (“Baby” link) too. Even better, she can find some extra useful information at the “Get advice for creating a kid-friendly home” link, here she can get rid of many doubts about how the items that she’s looking for might suit her children and baby’s needs. And since Sara is too busy with her children, she thinks that making the whole purchase online will be the best idea. For this reason, she wants to know how much the home delivery expenses are for the items that she selected. This information can be easily found at the “Shop Online” link, under “Services, shipping and return policy”. The delivery expenses look good to her, but there’s still one more thing she wants to clarify, the return policy. She contacts “Ask Anna”, the automated online assistant, and clarifies her last few doubts. At this point, Sara feels 100% comfortable to make her purchase online at the IKEA web site. She registers her profile at the “Log In” area and purchases what she had in her mind before. This has been a great purchase experience for Sara, who thinks that IKEA will still be very helpful to her even in the future; for this reason she decides to register to the IKEA Newsletter to keep in touch with future IKEA deals and promotions that can be useful to her and her family.
  • 19. P a g e | 19 WIREFRAMES Persona 2 – Sara Atherton