What needs considering when you transfer local to global strategy?
In retailing, the strategy of the product, the price, the location, and the promotion is relatives with the culture of the country. IKEA have to think about tastes and preferences for each country. Having presented the factors that make the growth in retailing abroad difficult, there are specific cultural reasons, which make IKEA’s expansion abroad not easy: -Cultural specific strategy:
• The use of the Swedish flag
• Swedish style of the furniture
Lack of cultural adaptation:
The main strategic issue at IKEA was the fact that they largely ignored the rule that they needed to tailor the product line. They did this to stick to their founder’s vision of “typically Swedish” products wherever in the world they were going to sell. This strategy proved to work in all other countries except when they entered North America, particularly the United States. I think IKEA trying to stay true to the vision was noteworthy, but they should have definitely followed norm when going global. • Prior to its difficulties in the US, IKEA didn’t make specific adaptation when it entered into a new market, but followed always the exactly same strategy than in others countries. Certainly, the brand positioning strategy is global consumer culture positioning, the brand is a symbol of a given global consumer culture, as well as foreign consumer culture positioning, the brand has been built around a specific foreign culture, Swedish culture, with the Swedish names of the furniture, Swedish restaurants, the colors of the Swedish flag, etc. All sold expensive products for delivery up to two months after a customer’s order; companies didn’t lead a strategy of expansion. Nevertheless, IKEA, with its competitive advantage, its size and resources, has changed the global markets: many small furniture retailers have departed, and there is now a trend for growth of larger-scale retailers, and for an increased number of...
Please join StudyMode to read the full document