Creation of all new IKEA products is determined primarily by the price, and then design. We can know the cost of the sofa or watch before they will be designed. The company then wraps the product around the IKEA brand using some sophisticated marketing tricks.
The company simply obsessed with the fact that it hails from Sweden, and tries to remind about it everywhere. On the shelves there are books in Swedish, in the store you can see posters and calendars in Swedish. Every IKEA store worldwide offers discounts on national holidays in Sweden. And, of course, there is the Swedish menu in the cafe, which sometimes shocks people who are unfamiliar with Scandinavian cuisine. IKEA positions itself like the Sweden Embassy in every city.
By Larry Heart
Another “quirk” of the company is the environment. The IKEA site has a huge section, filled with articles and documents, which confirm the sustainability of the company. There are such “green” chips as natural ingredients, eco-friendly packaging, flat containers, and receiving stations of used batteries which are telling customers “we are for nature”.
The products names are generated by a special program and have no semantic coloration. Every IKEA store has a room of “mother and child”, where you can swaddle and feed the baby. There is also a children’s room, where you can leave an older child.
The company works only with suppliers that can withstand the quality standards of IKEA down to the smallest details. In one of the cities in Vologda one company purchased equipment for a few hundred thousand, and signed a contract with IKEA to supply simple wooden parts for furniture. Immediately after that, the company had to invest a few million in equipment for the establishment of eco-friendly packaging and a standard IKEA – under the threat of termination.
The prices of IKEA products have not changed since 2008.
Swedish giant stores appear only in the suburban hypermarkets because the company has limits on the amount of rent. In other words, being located outside the city, IKEA saves on rent and keeps the price low.
Regional representatives and managers in IKEA don’t have the right to buy expensive cars and to fly business class. Ingvar Kamprad, the founder of the company and the billionaire, drives the twenty-year “Volvo”.
Despite the soft and flexible marketing strategy, the company offers an extremely rigid in corporate culture. In IKEA there is a set of corporate rules that describe, for example, the girls-consultants must have underwear and managers have the opportunity to check personal e-mail of their employees. Yes, IKEA is not Zappos.
IKEA was the first furniture store with the structure and logistics warehouse. Previously, nobody used this approach. When the first store in IKEA was opened (which looked like any other ordinary furniture store), the influx of visitors was so great that Kamprad ordered to open the doors of warehouses and allow buyers to take out everything that they need. That approach quickly became the model in IKEA.
Sly Swedes invented to hand out pencils, paper tape measure and notepads in their stores. We know that all people are forgetful and this step helped boost revenue at stores 7%.
Companies, which do not adjoin or are lucky to work with IKEA, know that Swedish giant loves to squeeze all the juice out of these companies. The motto of the company is “the softness to the buyers and rigidity to the suppliers”. We heard that there is an unwritten rule: the first two years of your work with IKEA all profits remain in IKEA.
There was such famous case when, during the opening of the first store of the company in Moscow, attending to the ceremony Ingvar Kapradu had to personally stand behind the cashier. He did it because the visitors swept from the shelves everything and there weren’t enough sellers. The goods packer was the Russian company’s top management.
Buyers are allowed to do whatever they want. You can rearrange the interior of the room, create a toys pyramid, you can even sleep on the couch but nobody will wake up and chase you. One day your humble servant rolled around the room on the truck for fun. Yes, I could find out desire to stop me on the consultants’ faces, but no one tried or dared to stop me.
Larry Heart is a hard-working internet marketing specialist currently working at the online eBooks website MyBookez. Feel free to ask any questions!
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