IKEA analyzed its consumer market through a cost leadership strategy of low operational costs, DIY assembly, and store locations that allowed for self-service. It expanded globally into markets like the US and Asia by adapting to local cultures through product customizations. IKEA targets family and teenage consumers through advertising and promotions. It promotes the lifestyle its products provide through campaigns. To continue growing, IKEA adapts to new markets by understanding cultural differences and targeting promotions while keeping prices low through its supply chain and assembly model.

1. How did IKEA analyse it’s
consumer market?

2. INGVAR KAMPRAD
THEN
Sold matches and Pencils
NOW
Founder of IKEA

3. One-stop sanctuary for coolness
650 Million visitors

4. HOW DID IKEA GROW ITS MARKET??

5. Cost Leadership Strategy

6. Low Operational Costs
DIY Assembly
Store Location
Self service

7. Brand Inventory
Supplier IKEA Consumer

8. Global Presence
Expanding into US and Asian market

9. Cultural Factors
Expanding into US and Asian market

10. Adapting to cultures
US Market- King Size Beds Chinese Markets
Indian and Chinese Markets –Assembly and packaging

11. Core Consumers
Family and teenagers

12. Consumer Centric Approach at IKEA Store

13. Advertising
Targeting
Core Consumers

14. Promotions and Campaigns
IKEA sells a lifestyle that customers around the world need
• “Ambassador of Kul”
• Facebook promotions

15. Promotions and Offers
IKEA sells a lifestyle that customers around the world need

16. Case Study Questions
What are some of the things IKEA is doing well to reach
consumers in different markets? What else could it be
doing?
IKEA’s Approach
•Low Price – Reduced risk from
competitors
• Low operational costs
•Adapting cultural differences
•Promotional Strategies
•Customer centric approach
•Huge number of suppliers
•Advertising – Targeting core
consumers
•Variation in product line
What Else Can IKEA Do?
• Expanding its sales with local
dealers and small retail shops to
target buyers who need only a
single product.
• Introduction of small stores in
close proximity to the cities
• Expanding its product line to
crockery and interior designing
• Marketing through public
relations.

17. Case Study Questions
IKEA has essentially changed the way people shop for
furniture. Discuss the pros and cons of this strategy,
especially as the company plans to continue to expand
in places like Asia and India.
Pro’s
• Competitive Prices
• Brand Image
• Product Differentiation
• Cultural Adaption
• High demand for sustainable
products
Con’s
• Store Locations
• Customer Perception for low price
products to be of lower quality
• DIY modal can be an advantage for
competitors for producing the same
product at even more cheaper price.

18. Next UP for IKEA in India

19. Summary
Foundation
and
History
IKEA
Growth
Cost
Strategy
Global
Expansion
Ads and
Promotions

20. Disclaimer
Created by Aashritha Sripathi, Osmania Univeristy during a
Marketing Internship by
Prof. Sameer Mathur, IIM Lucknow