IKEA Case Study
Derick McQuaide
Ikea Case: Note on Marketing Strategy Framework
Ikea’s differentiation strategy of offering high quality furniture at prices lower than competitors has led to its success as the top furniture retailer. They have designed their price reduction strategies in a way that makes it very difficult for competitors to copy furniture or business ideas and have a similar success rate. After reaching global sales of twelve billion dollars, Ikea was recognized as the top furniture retailer in 2002. The company’s brand differentiation strategy consisted of furniture designed for self-assembly, self-service warehouses, and retail stores that assess more than just furniture needs. Ingvar Kamprad opened the first Ikea retail store in Sweden in the 1950’s and has kept core principles similar such as keeping Scandinavian furniture designs and reducing unnecessary expenses. According to the framework, Ikea needs to focus on which dimensions create value for its customers in order to attain a target market and positioning strategy that sets itself above competitors. Ikea has managed to satisfy customer needs by providing high quality furniture at the lowest possible price in a convenient store setting. Ikea manages to produce appealing furniture for its customer base through proper material and design selection. They are a self-service retailer that provides convenience by having online or mailed catalogs where consumers can choose their furniture before even visiting the store. Customers are often satisfied since they can avoid the hassle of searching throughout the whole store and simply pick up their desired furniture. As the largest global retailer, Ikea has evolved company skills that make it difficult for any competitor to match. After receiving furniture quality complaints, Ikea changed their focus from being strictly price sensitive to making sure designs were appealing. The company created a system where they choose among the best designers, engineers,
Ikea Case: Note on Marketing Strategy Framework
Ikea’s differentiation strategy of offering high quality furniture at prices lower than competitors has led to its success as the top furniture retailer. They have designed their price reduction strategies in a way that makes it very difficult for competitors to copy furniture or business ideas and have a similar success rate. After reaching global sales of twelve billion dollars, Ikea was recognized as the top furniture retailer in 2002. The company’s brand differentiation strategy consisted of furniture designed for self-assembly, self-service warehouses, and retail stores that assess more than just furniture needs. Ingvar Kamprad opened the first Ikea retail store in Sweden in the 1950’s and has kept core principles similar such as keeping Scandinavian furniture designs and reducing unnecessary expenses. According to the framework, Ikea needs to focus on which dimensions create value for its customers in order to attain a target market and positioning strategy that sets itself above competitors. Ikea has managed to satisfy customer needs by providing high quality furniture at the lowest possible price in a convenient store setting. Ikea manages to produce appealing furniture for its customer base through proper material and design selection. They are a self-service retailer that provides convenience by having online or mailed catalogs where consumers can choose their furniture before even visiting the store. Customers are often satisfied since they can avoid the hassle of searching throughout the whole store and simply pick up their desired furniture. As the largest global retailer, Ikea has evolved company skills that make it difficult for any competitor to match. After receiving furniture quality complaints, Ikea changed their focus from being strictly price sensitive to making sure designs were appealing. The company created a system where they choose among the best designers, engineers,