Responding to Sears “Elements” Line of Furniture / Ikea

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Date: September 25, 1986 Subject: Responding to Sears “Elements” Line of furniture Issue/Problem The Canadian furniture market has brought success to IKEA Canada due to the high quality and low priced “quick-assembly” furniture designed by IKEA’s European engineers. However, this success brought many imitators. Sears Canada has recently published a new catalogue that includes a new line of furniture called “Elements”. The new line of furniture very much resembles IKEA’s knock-down, self-assembled line. IKEA is facing an imitation threat and should tactically respond to minimize its effects. Recommendations IKEA is considered to be a low cost, high quality producer in the furniture industry, therefore it is important to…show more content…
It also needs to increase its marketing efforts by printing and distributing more catalogues. IKEA should learn more about demographics of market segments in Canada since management feels that the IKEA concept appeals to a much wider group than the existing target market. In addition, IKEA can increase the frequency of catalogues distribution. E.g. quarterly or semi-annual distribution. Despite the increase in costs that comes from printing more catalogues, IKEA can reduce its marketing expenditures on magazines advertisement and other means of promotion. Since Sears “Elements” products can only be purchased through a catalogue and can not be viewed in store, it is advantageous that IKEA informs consumers that all items shown in the catalogue are available in store. This will greatly appeal to existing and new customers and enable them to view the item before purchase. Despite the increase in costs that comes from printing more catalogues, IKEA can reduce its marketing expenditures on magazines advertisement and other means of promotion. Competitive Tactics In order to minimize the imitation threat, IKEA Canada should employ a few tactics to remain competitive in the market. First, IKEA should maintain its contracts and close relationships with low cost suppliers as this is usually hard to imitate by competitors. Second, IKEA should improve its mail

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