Ikea Swot Analysis Essay

The philosophy states “ Our vision is to create a better everyday life for the many people. Our business idea is to offer a wide range of well-designed, functional, home furnishing products at prices so low that as many people as possible can afford them.” IKEA needs to create products following this motto but have these products molded to the tastes and styles of the U.S. population. The prices must still be low but IKEA must force the message that even though the price is low that does not mean the quality of the product is poor. This message will be key for expansion in the U.S. to be a success. IKEA must maintain their shopping experience as that is a strong competitive advantage, and tweak their philosophy so it fits the American lifestyle. If they do this then they will have success in expansion.

As explained in the “bargaining power of consumers”, it is hard to substitute the products that are offered by IKEA. This is further intensified by the fact that IKEA has formed a brand perception that makes it stand out amongst its

This paper aims to demonstrate a detailed description of the elements of ‘IKEA’ company based on its famous name in the furniture industry.

With further global expansion, in order to maintain profitability it was crucial for IKEA to establish the main potential customer group, who would not only appreciate the product concept but will be able to afford it and recognise it as being a "good-value”. The IKEA concept proved to be successful in the developed countries and free trading markets, but the same acceptance can’t be anticipated in the countries with large variations in exchange rates, high inflation and/or high import tax and other restrictions, e.g. bureaucratic obstacles in Russia and China.

With such situation, IKEA faces several challenges in this competitive market. In order to prevent to be substituted, IKEA need to improve on marketing strategy. I have two ideas of marketing strategy which is online store and IKEA collaborate with real estate.

From its low cost structure to its corporate culture (“The IKEA Way”) to the do-it-yourself approach (replete with measuring tapes, paper, and pencils available in-store) plus its strong brand image (representative of high quality, low-cost ,trendy, modern and fashionable

IKEA is one of the most successful furniture retailer who dedicated to sell flat pack of furniture, accessories, and bathroom and kitchen items around the world. It is well-known as a global phenomenon and its famous statement that “Our vision is to create a better everyday life for the many people”. IKEA has a clear and consistent concept in providing low price, value for money furnishings with a full range of choice. Its philosophy in the core value of cost efficiency along with IKEA's competitive strategy, which influences the performance objectives of operations in company. IKEA shows an excellent performance in achieving cost competitive advantages

There are two external environment for IKEA. One of the external environmental factors business has to consider is social factors. This is because it constant and affects client’s way to life, expectation and preferences. IKEA is taking component lifestyle into account. They realize that people have their own tastes. IKEA’s goods are broad in their designs and style. Example, they have 83 designs for only the cloth sofas and 50 designs for only leathers. Some of the goods are uncomplicated in design while some are fancy. There are many options for client who have their own lifestyle and

IKEAs brand image is built on their long term strategic focus to produce products from sustainable materials in an aim to care for the environment and earth’s natural resources. This aligns with IKEAs vales to promote social, environmental and economic development. IKEAs concept of customers shopping for mass produced, standardised products in a ‘self-service’ environment allows for cost efficiency

Ikea's success in the retail furniture industry can be attributed to its vast experience in the retail market and its ability to integrate both product differentiation and cost leadership strategies successfully.

Ikea 's management idea is "provide various kinds, beautiful and practical products, promising that most people can afford the household articles for use". In

Even though there have been many changes in the economy Ikea has been able to regulate the changes with their success in obtaining the lowest production prices. The company continues to provide high quality furniture that goes with their original concept of stylish furniture for a low price. Ikea offers all kinds of products that cater to most any lifestyle and budget. Ikea still mostly operates their business in the European market. Consequently, they are able to reach more customers in different countries based on the location of their production and distribution centers. Even with the many changes to the economy Ikea has managed to stay in business with their low pricing by developing different products that is in demand by

IKEA is a manufacturer of home and business furnishings who offer interior furnishing products to consumers in several countries across the globe. Before IKEA plans on expanding and entering any new market, they are required to obtain a clear understanding of what consumer behaviour and requirements are in that particular market. There are basically two types of Markets which include Consumer Market and Business Market.

At the outset, it may be useful to characterise IKEA in terms of the characteristics of demand (also known as the four Vs, see Slack et al. p 20). First, IKEA is clearly a high volume operation – as indeed most international retailers are – which lends to systematising operations but which implies capital intensive processes and therefore cost considerations will be crucial. Second, IKEA offers a large number of products (up to 14000 depending on the country/store) so there is high variety in the

IKEA’s strategy before the mishaps in America could be characterized as going against the norm charting their own path to success using low priced manufactures to secure lower selling prices aimed to target those who were of older age and of middle class standing. Their new strategy was to target those of a younger demographic, young married couples, college students, and 20-30 something singles. By reemphasizing design, promoting through hip quirky advertisements, and encouraging consumers to do away with their old furniture, IKEA revenues doubled in a four-year period. IKEA today has adapted somewhat of a local customization strategy where their store layouts will resemble that of many local household layouts as proven by their success in China where they failed to expand beforehand. They also keep their prices extremely low in some areas as China by sourcing a large percentage of products in the area of operation.