The consumers were allowed to touch and feel the products before they made the decision to buy. This generated a sense of trust in consumer’s mind. A customer friendly ambience was also created by providing house like models in the stores for displaying the furniture. Restaurants and child care centers were also made available. IKEA also designed tasteful furniture products based on consumers’ feedback and buying behavior IKEA and thus was able to keep up with the competition and expectation.
Our success depends on the satisfaction of our customers and we are committed to giving them the ultimate shopping experience. SWOT Analysis Strengths: 1. Stores are clean and well designed. Aisles are open and clutter-free which makes it comfortable for customers to shop. The lighting is fantastic, making it easy to see products clearly.
To transform the IKEA Concept into reality, the company provides stylish, functional, low-cost home furnishings that customers must assemble themselves. Furniture products are shipped in flat packs to save money on manufacturing and distribution, which IKEA then passes on to customers in the form of lower prices at retail. To compensate for the customer having to “do it yourself,” IKEA offers other services that make this proposition a little more attractive. These extra services include in-store child-care and play areas, restaurants, and longer store hours. To help visitors prepare for this experience, IKEA provides its customers with pencils, paper, tape measures, store guides, catalogs, strollers, and shopping bags.
Once these three steps were complete, then IKEA would hand over the price point, product specifications, and the materials list over to the design team and they would compete for the winning design. The final idea that sets IKEA apart from the rest with their product strategy is the fact that all of their products are designed for flat shipping. This means that customers assemble their purchases at home which cut down on shipping costs for both the company and the consumer. Fact #2: The design of their retail stores differs widely from its competitors. “Upon entry, shoppers were gently coerced into a predetermined path through cheerfully decorated model bedrooms, kitchens, living rooms, and bathrooms.
Since “value reflects the sum of perceived tangible and intangible benefits to customer” (Kotler & Keller 2009, Pg. 14), this technique offers as profitable marketing strategy to retail stores. Value is important because it provides customer satisfaction. “Satisfaction reflects a person’s judgment of a product’s perceived performance in relationship to expectations” (Kotler & Keller 2009, Pg. 14).
It is obvious that IKEA have positioned itself as the bellwether of furniture retailer market and leads the tide of simple style furniture. • What is their value proposition and what types of value do they base their marketing on? Because one of IKEA’s main goals is to provide products at low prices to customers. I think that IKEA works to maintain a well-known brand identity, so IKEA has very clear and stable targeted customers who seek stylish furniture at a reasonable cost. Moreover IKEA is known for its modern architectural designs on various types of appliance and furniture, often associated with a simplified eco-friendly interior design.
They were also able to lower their shipping cost of bulky items such as furniture by having it disassembled to maximize the use of space inside their shipping containers. b. Delivery Speed “Make the Product or Deliver the Service Quickly” - Ikea strives to deliver the number of goods to the right stores at the right time. They calculate the goods requirement and make sure that deliveries are efficient. c. Environmental Impact - Part of Ikea’s environmental considerations is making their mugs lead and cadmium free.
IKEA is known for its affordable furniture and products that are invaluable to people on a budget. However, in the context of international business it is assumed that major corporations providing low cost goods do it through the exploitation of people. There have been numerous cases that have been well documented including Wal-Mart, Nike and even Disney (Hansen, 2005). So in most cases it is just the human cost of doing business in order to have a cost leadership strategy when selling products. However, IKEA defies this logic and this paper will show how IKEA is very concerned with social corporate responsibility to make a profit while still maintaining excellent ethical standards that go above and beyond the legal requirements.
(p. 2) In order to provide such low prices at a great value, IKEA had to reinvent the wheel in terms of the supply chain and ultimately how customers received their products. They were a game changer in the furniture world as described by Lancaster & Walters (1999): The IKEA example is interesting because the company has: systematically redefined the roles, relationships and organisational practices in the furniture business. The result is an integrated business system that invents value by matching the various capabilities of participants more efficiently and effectively than was ever the case in the past. (p. 648). IKEA’s promise of value also extends past its products and into the customers’ actual shopping experience.
How does Ikea generate customer loyalty? IKEA has been using a lot of marketing strategies to attract customers to promote customer loyalty and generate customer loyalty, IKEA’s customer loyalty generated by meet customer’s demand, low prices, and promotional activities, in other words, the reason why customers are loyal to IKEA, is completely because IKEA meet the needs of most customers, I will explain how IKEA generate customer loyalty by using 4Ps and 4Cs. Product: IKEA emphasis on product beautiful design, durable, so consumers are satisfied with IKEA products. Price: IKEA's products pursuing beauty and utility and also maintaining low prices, so that meet the consumers product value satisfaction. Place: IKEA has a unique style of store display, compared to other furniture store, IKEA is more like a furniture supermarket, so that meet the consumers shopping style satisfaction.