It is about IKEA,international retailer in home furnishing and its markets and marketing strategies.

2. IKEA is an international
home product company that
designs & sells ready to
assemble furniture appliances
and home accessories.

3. It was founded in 1943 by a Ingvar Kamprad
with a vision to offer home furnishings items
of excellent quality at prices so low that the
majority of people can afford to buy them.

4. Company which initially sold pen, eventually
grew into a retail Titan in home furnishing,
Business week calling it
“One stop Sanctuary for home coolness”
& “Quintessential cult brand”.

5. What are things IKEA is
doing right to reach
consumers
in different markets and
how they did it?

6. Finding smarter ways to make Furniture
Strategy followed by IKEA
Price
Quality

7. Implementation Steps
Establish Retail Price
Select Manufacturer
Determine material used
Design process

8. Establish Retail Price
• Using the matrix ,IKEA would set
the price range.
• It would survey the competition to
establish a benchmark and sets its
own price point 30-50% lower than
rivals

9. Select Manufacturer
• IKEA sources its products from multiple
companies all over the world.
• It has more than 1800 manufacturer in
more than 50 countries ensuring
lowest price possible and thus
transferring to customers.

11. Determine the Material used
• Done by IKEA engineers, focus on cost
efficiency.
• Using different type of wood for single
wooden product.
• Using high quality materials for surface
visible and most likely undergoing stress
and vice versa.

12. Design Phase
• Flat packaged boxes to make it easier
for consumers to transport furniture
home + save shipping cost
thus transferring value.
• Innovative designs.

14. PROS of this strategy
• Good furniture at low cost.
• Simplicity in shopping and furniture
assembly.
• Uniformity all over the world.
• Ensuring customer loyalty by offering
rewards

16. CONS of this strategy
• Less inclination to customer service.
• Visiting an IKEA store is not economical
even through purchasing is.
• No innovation in products.
• Uniformity can turn into rigidity

17. CUSTOMER SERVICE

18. OPPURTUNITIES
&
What else could it be doing?
• It can expand its business to luxury,
interior designs and crockery products.
• It can expand its retail services to
middle class emerging markets like
China and India.

19. Emerging markets like China
& India

20. RECAP
• International home product company
which sells ready to assemble furniture .
• It establishes retail price ,sources its
product from all over the world &
designs the product to pass value to
consumers.
• Provides good furniture at low cost.
• Less inclination to customer service.

21. DISCLAIMER
Created by Prashant Kumar Ojha, IIT BHU
during marketing Internship by
Prof. Sameer Mathur, IIM Lucknow.