Learning from IKEA Marketing Strategy
By : Ardhi Bebi Laksono | Friday, July 31 2020 - 19:15 IWST
Ardhi Bebi Laksono
INDUSTRY.co.id - Who doesn't know IKEA in the furniture market. A Swedish company founded by Ingvar Kamprad in 1943, is the largest furniture company in the world. Even in 2018, the Bloomberg Billionaire Index named Kamprad the number eight richest person in the world. He achieved this success for more than seven decades in running the IKEA business. In the 1950-1960 era, IKEA was famous for its products that were far cheaper than similar furniture sold in the market. Its competitors compactly spread the propaganda that IKEA products are cheap. But the results of a study from the well-known Swedish magazine Allt i Hemmet stated that IKEA products have equivalent quality, even better than those sold by competitors.
The secret turns out to be simple, IKEA applies the production strategy to drive the company. They managed to get access to raw materials of the same quality as their competitors and process them at the lowest possible cost. Then the product is sold with a thin profit margin. The result is lower product prices, but the quality is the same as its competitors. This production efficiency can be done by setting up production plants in the area (villages) so that production costs are low. In fact, his expulsion to Poland gave a blessing to IKEA. That is because the cost of production in Poland is much cheaper than in Sweden. So IKEA products become better at prices that are actually getting cheaper.
The IKEA marketing catalog strategy is very effective. There are some secrets that we can check from the promotion strategy. IKEA takes full advantage of the customer database. They record each of their identities and customers. They survey customers who shop at their stores. Starting to send a catalog in the form of a letter to the customer's address, until now using email marketing. Another strength of IKEA's marketing strategy is its creativity. The IKEA catalog is designed to be very attractive so that it can bring potential customers to come directly to the store. IKEA's promotion strategy truly fulfills all segments of society in selling its products. They do not only provide promotional highlights on certain products, but all of them are given adequate "spotlights". Customers' convenience when shopping is number one for IKEA. It is important to make customers as comfortable as possible in the store and enjoy shopping for furniture that takes time. We review three IKEA secrets that make customers feel at home shopping. Those are the three marketing strategies that we can learn from the famous furniture brand named IKEA. Production, distribution channels, and marketing strategies that work very well are the keys to the success of this one brand.