Case study on ikea

1. IKEA CASE STUDY

2. INTRODUCTION
• 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. 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.
• 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.

3. 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.

4. • .
• Lets begin with how ikea earns profit:
• 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 first logo:
our first logo was created in in 1951 it was round in shape and used the colour red’ikea founder,ingavard kamprad’like
the color red because it represents low price

5. MARKETING STRATEGY OF IKEA
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
lookout into learning different strategies of IKEA
• 1.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.
• 2.CONTENT 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.

6. 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.
1.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.
2.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.
3.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.

7. 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.
AMAZING USE OF TECHJNOLOGY: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.

8. 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.
IKEA KEY VALUES:
They are very strict about their values.
They firmly believe that every individual has something
valuable to offer.
Let’s look at some of there core values –
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

9. 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
FEATURES
1. Timings- An important feature of many IKEA stores is their long opening
hours. Many IKEA stores are in operation 24 hours a day with restocking and
maintenance being carried out throughout the night. However, public
opening hours tend to be much longer than most other retailers, with stores
open well into the evening in many countries. In the UK for example, almost
all stores are open past 8pm with opening times often around 9-10am. Ikea
Croydon has one of the longest opening hours worldwide being open from
10am 12 Midnight Monday to Friday.
2. 2. Restaurants- Many stores include restaurants serving traditional Swedish
food such as potatoes with Swedish meatballs, cream sauce and lingonberry
jam, although there are variations. Besides these Swedish staples, hot dogs
and drinks are also sold, the latter for around 5 SEK (approx $1 USD), along
with a few varieties of the local cuisine, and beverages such as lingonberry
juice. Also items such as Prinsesstårta — Princess cake are sold as desserts.
Refills of coffee, tea, and soft drinks are free of charge, even in countries
where this is uncommon in other restaurants.
3. 4. Child Care- Many stores have a play area, named Småland, for children
aged 3 to 10 years (may vary). The service is offered completely free of
charge. Parents drop off their children at a gate to the playground, and pick
them up after they arrive at another entrance. Parents are also given free
pagers by the on-site staff; the staff will set off these pagers should a child
need his/her parents sooner than expected. The area mostly features things
such as slides, seesaws, cartoons, a ball pit, etc.

10. FOUNDATION : The INGKA Foundation is officially dedicated to
promoting “innovations in architecture and interior design.” With an
estimated net worth of $36 billion, the foundation is unofficially the
world’s largest charitable organization, beating out the much better
known Bill and Melinda Gates Foundation, which has a net worth of
approximately $33 billion.
After the Pakistan earthquake of 2006, IKEA gave 500,000 blankets to
the relief effort in the region
• IKEA has provided furniture for over 100 "bridge schools" in Liberia.
• In the 2008 Sichuan earthquake in China, IKEA Beijing sold an alligator
toy for 40 yuan (US$5.83, €3.70) with all income going to the children
in the earthquake struck area
> IKEA also supports American Forests to restore forests and reduce
pollution.
CAMPAIGN :Ikea India has released a new
campaign titled ‘Ghar Aa Jao’ (come home to
Ikea).the new positioning is aim at creating a deeper
sense of emotional and rational connect with the
customer,s The campaign will run across various
channels like TV, print, radio, OOH, digital,social and
in stores
The advertising campaign makes connections
between the brand and the traditional Indian ethos of
having guests over to rejoice and make memories
on any occasion ..
The campaign reiterates that Ikea puts the home-
like feeling at the center of all they do.
The campaign consists of four slice of life TVCs featuring
Ikea workers creating the experience of warmth, love, and
feeling of ‘Life at Home’ while shopping at at Ikea stores.
While one shows an elderly man hiding from his wife and
eating sweets