Ikea’s vision is “to create a better everyday life for the many people”. Secondly, Ikea has strong brand. It remains one of the oldest companies in the industry. Ikea promotes its brand image by differentiating from other competitors which gives customers the image benefit. Ikea use Swedish national colors to paint its stores and boxes which is simple but easily memorable brand image.
To change the price structure Kamprad designed sleek functional furniture which was able to be produced on machines and thus cheap to assemble. Furthermore, he utilized factories and workers in Poland which offered a 40% savings over production within Sweden. This pricing strategy allowed nearly unhindered growth for the furniture giant within countries of what I would consider the European Union. As growth continued, IKEA took advantage of the fragmented furniture industry within the Western European furniture markets. Instead
A selling point for the American stores was that the furniture came assembled and some stores would even offer delivery services free of charge or with some fee. In America delivering assembled furniture took time and came at a higher cost. Taking into account the cultural barriers that reflected the sales of the IKEA products in America, IKEA started to pay close attention to customer complaints. The advantage for IKEA was that they were able to solve the problem by paying close attention to market research and thus improve its offering to the US markets. The product lineup and merchandising was then adjusted.
Taylor focused on using independent sales representatives and brokers of supermarkets in order to distribute this product. A good hand around the networks and which people to trust down the chain to distribute the product was a great value driver for the company. Softsoap sold very well in the soap section of the supermarkets rather than the beauty aid section & was priced very fairly. Minnetonka also created value for their product by customizing their product line. They introduced themselves in the toothpaste market, even if not for a very successful stay, they were looked at as a company willing to take risks to expand their product line.
This could see them become a one stop shop for everything to do with fashion, from makeup to clothes to fashionable gifts for friends. In the current business environment, consumers are shopping less because of the recent recession, however if they see smaller, inexpensive items alongside the clothes they are purchasing in Topshop, they are likely to pick them up and buy them, seeing them as a small extra; bringing in a considerable increase in profit for Topshop overall. Since it was founded in 1964, Topshop has gradually become higher end in the eyes of consumers. When it began it was seen as a bargain shop, much like Primark is viewed today. However it has adapted to the current business environment and is now seen as one of the higher end shops on the high street.
Best Buy is able to effectively manage the flow of its inventory that helps them complete the important task of having the right merchandise on its shelves for customers to buy. Weaknesses Although Best Buy has a large market share, the sales of the company heavily relied on domestic sales. The large percentage of the company’s sales mostly comes from US market despite the existence of its stores in other countries. The company still needs to push the products to the market in order to stay in the global market. Best Buy lacks strategies in strengthening the business in other countries where the company operates.
Zara was the oldest brand of Inditex and it was the innovator of the new category “fast fashion”. Its success was due to trendy cat walk inspired items manufactured at a fast pace but at affordable price. The supply chain design strategy responsible for the phenomenal success of Zara brand in its niche market was its quick response to the changing trends in the fashion industry and the requirements of the customers. Unlike the average of six months needed by a luxury brands Zara was able to manufacture and deliver the items in round three weeks period to its stores. Its key competitors typically supplied on average 2000 to 4000 items while Zara on the other hand was able to supply 11000 in a season.
The most successful strategy that Wal-Mart complete is that the company is good at synergies between food and retail. Since people usually shop food in the store, the frequency of people visit will help the sales of retail. Additionally, a succeed brand positioning of modern and lower-priced supermarket that Wal-Marts created could evoke customers’ mind when they are seeking a product which the company offered. * Knowing the needs of particular market: Wal-Mart create neighborhood markets to target convenience shopper for penetrating new markets. In order to target convenience shopper, Wal-Mart has solid understanding about what the target market needs and wants.
By doing this, the company capitalized on the needs of the citizens by providing affordable products at a convenient location. Often these towns could only support one store like Wal-Mart and because of this the company was able to bar other companies from entering the local market. Wal-Mart also implements a successful distribution strategy, positioning its distribution centers within a day’s drive of each store to ensure prompt and efficient deliveries. Even with Sam Walton’s death, Wal-Mart executives continue to stick to the management rules Sam developed. Wal-Mart is successful not only because it makes sound strategic management decisions, but also for its innovative implementation of those strategic decisions.
Case Study: IKEA Invades America Eunice Hurh University of North Texas Case Study: IKEA Invades America 1. What factors account for the success of IKEA? a. There are three main factors that account for its continual success in the furniture retailing industry: Scandinavian designs, cost efficiency, and product strategy i. Scandinavian heritage is showcased beautifully through IKEA’s simple yet unique designs. In the early years, IKEA’s designs were functional at best, ugly at worst (Moon, 2004).