Ikea Marketing
EXECUTIVE SUMMARY
In 1998, the first IKEA store was opened to the Chinese market in Shanghai, the country’s financial cradle and now ready to expand further. With a consistent economic growth level, China is attractive to most multinational companies as a green of business potential. However, a successful expansion needs to reflect the way in which IKEA understands the marketplace in terms of cultural infrastructure, protection of its brand, trade barriers such as host country legislation, political structure of the intended market e.g. failed market entry in Russia and Japan, although it aims at re-entering Japan.
Earlier this year’09, the company pulled out of a $1 billion investment plan to start retailing in India because of the Indian government’s strict licensing laws for foreign-owned companies whereby the government refused to raise the ownership cap by foreigners from 51% on single-brand stores.
As attractive as the potential Chinese consumer market is with a population of 1.3billion, not all of multinational companies that have ventured have succeeded.
The method of design, production/manufacture of IKEA products as well as distribution, promotion and sales are steered along course by the “IKEA Concept”.
The basis of the IKEA Concept ideology is making available home furnishing products at affordable prices, combining design, quality and functionality. This ideology has helped give access to a vast variety of customers instead of a selective target segment, enabling better living giving a range of lower priced product
IKEA is considering further expansion in emerging markets e.g. more stores in China and new opportunities in India, thorough market assessment is essential especially one which has a pricing strategy taking into account the difference in levels of income of consumers. This paper presents a case study of IKEA’s marketing implementation using techniques such as the marketing mix (the 4Ps) model. The findings illustrate what
In 1998, the first IKEA store was opened to the Chinese market in Shanghai, the country’s financial cradle and now ready to expand further. With a consistent economic growth level, China is attractive to most multinational companies as a green of business potential. However, a successful expansion needs to reflect the way in which IKEA understands the marketplace in terms of cultural infrastructure, protection of its brand, trade barriers such as host country legislation, political structure of the intended market e.g. failed market entry in Russia and Japan, although it aims at re-entering Japan.
Earlier this year’09, the company pulled out of a $1 billion investment plan to start retailing in India because of the Indian government’s strict licensing laws for foreign-owned companies whereby the government refused to raise the ownership cap by foreigners from 51% on single-brand stores.
As attractive as the potential Chinese consumer market is with a population of 1.3billion, not all of multinational companies that have ventured have succeeded.
The method of design, production/manufacture of IKEA products as well as distribution, promotion and sales are steered along course by the “IKEA Concept”.
The basis of the IKEA Concept ideology is making available home furnishing products at affordable prices, combining design, quality and functionality. This ideology has helped give access to a vast variety of customers instead of a selective target segment, enabling better living giving a range of lower priced product
IKEA is considering further expansion in emerging markets e.g. more stores in China and new opportunities in India, thorough market assessment is essential especially one which has a pricing strategy taking into account the difference in levels of income of consumers. This paper presents a case study of IKEA’s marketing implementation using techniques such as the marketing mix (the 4Ps) model. The findings illustrate what
References: The IKEA website http://www.ikea.com/ms/en_GB/about_ikea_new/press_room/student/index.html Wikipedia Reference Pages on IKEA http://en.wikipedia.org/wiki/Ikea Los Angeles (LA) Times - 25 Aug 2009 http://www.latimes.com/business/la-fi-china-ikea25-2009aug25,0,7736661.story UNICEF Website http://www.unicef.org