Ikea’s Approach Toward International Marketing and Trade
IKEA’s Approach toward
International Marketing and Trade
And
Doing Business in United States
Hossein Kazemi
S.N. 100841490
Prepared for Professor David Cray
July 15, 2012
IBUS 5711 & IBUS 5713
Sprott School of Business
Carleton University
July, 15, 2012
IBUS 5711
International Marketing and Trade “IKEA”
Submitted to Professor David Cray
By Hossein Kazemi Student # 100841490
IKEA is known as the world’s largest international home product retail company. The compony established in Sweden by a 17 year old boy named Ingvar Kamprad in 1943 (Wikipedia, 2012). The company was ranked 44th in a list of the top 100 international brands by interbrand and has more than 220 stores operating in 41 countries with 29 trading service offices in 25 countries worldwide (IKEA, 2010). IKEA offers a wide variety of home furnishings of good design and high quality with the lowest possible price in order to make the products affordable for the majority of people through ready-to-assemble items. IKEA’s target customers are generally young low to middle income families who are looking for value (Dimitriadis, 2002).
The company’s commitment and policy on low cost production is associated with consumer interest. Actually IKEA’s customers can be considered as quasi producers too, because they have to transport and assemble the products themselves. Nowadays with the world’s current economic situation IKEA’s strategy of high quality, design, and low prices gives it an even greater competitive advantage to the company over its competitors. The company has even centralized its research and development activities in Sweden in order to minimize the costs (Dimitriadis, 2002).
In fact cost control has become a culture for the company and has embedded itself into the organization, affecting every part of the company from management travel allowances (economy class instead of business class) as well as design costs. According to Ingvar Kampard, the founder of IKEA “ to design a desk
International Marketing and Trade
And
Doing Business in United States
Hossein Kazemi
S.N. 100841490
Prepared for Professor David Cray
July 15, 2012
IBUS 5711 & IBUS 5713
Sprott School of Business
Carleton University
July, 15, 2012
IBUS 5711
International Marketing and Trade “IKEA”
Submitted to Professor David Cray
By Hossein Kazemi Student # 100841490
IKEA is known as the world’s largest international home product retail company. The compony established in Sweden by a 17 year old boy named Ingvar Kamprad in 1943 (Wikipedia, 2012). The company was ranked 44th in a list of the top 100 international brands by interbrand and has more than 220 stores operating in 41 countries with 29 trading service offices in 25 countries worldwide (IKEA, 2010). IKEA offers a wide variety of home furnishings of good design and high quality with the lowest possible price in order to make the products affordable for the majority of people through ready-to-assemble items. IKEA’s target customers are generally young low to middle income families who are looking for value (Dimitriadis, 2002).
The company’s commitment and policy on low cost production is associated with consumer interest. Actually IKEA’s customers can be considered as quasi producers too, because they have to transport and assemble the products themselves. Nowadays with the world’s current economic situation IKEA’s strategy of high quality, design, and low prices gives it an even greater competitive advantage to the company over its competitors. The company has even centralized its research and development activities in Sweden in order to minimize the costs (Dimitriadis, 2002).
In fact cost control has become a culture for the company and has embedded itself into the organization, affecting every part of the company from management travel allowances (economy class instead of business class) as well as design costs. According to Ingvar Kampard, the founder of IKEA “ to design a desk
References: Allen, S (2012), Ingvar Kamprad - IKEA founder and one of the world 's Richest Men, retrieved July 9, 2012 from http://technologymarketer.blogspot.ca/2009/03/is-ikea-good-model-for-it-marketing.html Allvoices Bartlett, C, A. Nanda, A. (1996). Ingvar kamprad and IKEA. Harvard business school. Retrieved July 10, 2012, from http://hbr.org/product/ingvar-kamprad-and-ikea/an/390132-PDF-ENG Dimitriadis, N Frohloff, B. (2007). IKEA credit card consumers. Retrieved July 13, 2012, from http://www.lawyersandsettlements.com/features/consumer-credit-information-protection/ikea-credit-cards.html#.UAB10fVdfAk Flexibility in the networked society.(2007) Flexibility in the networked society.(2007). Ikea. Retrieved July 11, 2012, from http://flexibilityinnetworkedsociety.blogspot.ca/2007/10/ikea.html IKEA (2007), IKEA, Retrieved July 9, 2012 from http://www.ikea.com/ IKEA of Sweden (1996), Retrieved July 9, 2012 from http://www.geocities.com/TimesSquare/1848/ikea.html Mark, M (2009), Is ikea a good model for technology marketing Naturalstep. (2012). IKEA a natural step case study. Retrieved July 14, 2012, from http://www.naturalstep.org/en/usa/ikea Olsson, J Reichert, J. (1996). IKEA and the Natural Step. Retrieved July 14, 2012, from http://www.naturalstep.org/en/usa/ikea Suarez, F Skaljak, G. (1999). Ikea in the US. Retrieved July 9, 2012, from http://freespace.virgin.net/gordon.ska/page/ikeacase.htm Scribd The Economist. (1994). Furnishing the world. 19, P 101-102. Wikipedia. (2012). Ikea history. Retrieved July 8, 2012, from http://en.wikipedia.org/wiki/IKEA