Brand_Inventory_FINAL12

Brand_Inventory_FINAL12 - Heritage The name IKEA has become...

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Heritage The name IKEA has become synonymous with inexpensive, stylish, self- assembly home furnishings. However, today’s brand is a far cry from its original version in 1943. Back then, IKEA was a mail-order company, selling basic sundries. Not until later that decade did they begin selling furniture. By the early 1950’s, IKEA had introduced their now-famous catalog, and in 1956, they started designing the familiar self-assembly furniture that fits in flat packaging. Their first store finally opened in 1958 in Älmhult, Sweden. Throughout the next several decades, the company expanded to over 300 stores in 38 countries and made their U.S. debut in 1985. They improved quality through careful product testing, introduced low-cost, highly durable materials like fiberboard and particleboard, and cut costs by acquiring their own sawmills and production plants to make wood furnishings and components. Further, they developed the IKEA Food brand, and started opening restaurants in their stores. In 1997, they introduced Children’s IKEA, a line geared specifically towards children, and launched their own website. By 2000, customers could shop for their favorite IKEA products online. Today, IKEA is a successful global brand with many loyal customers. This is due in large part to the implementation of the company’s vision, which since 1943, has been to “create a better everyday life for the many people.” Because of this, their customers have become almost fan-like in their allegiance to the IKEA brand. Brand Positioning IKEA has positioned itself as a high-volume, low-cost home goods retailer. As such, they are competing not only against furniture retailers, but also against retail
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giants like Walmart. In order to stand out against such competitors, IKEA offers customers functional and innovative products built with high design. Their unique, Swedish-style designs have become a differentiator against Walmart and other big-box retailers. Additionally, IKEA capitalizes on their Swedish heritage by offering, safe, well- built products. To differentiate themselves from other furniture retailers, IKEA exploits their economies of scale to sell their products for far less than competitors. IKEA offers minimal customer assistance, and instead promotes customer involvement by allowing them to choose, transport, and assemble their own purchases. Product IKEA’s products are only available through IKEA outlets. All of their 10,000+ products are sold under the IKEA brand. Although these products vary greatly, they mostly fall into the category of home goods and can be described as simple, modern, European-styled, low-cost and flat-packed (assembly required). IKEA’s brand hierarchy is chaotic with little order to their sub-brands (see
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This note was uploaded on 03/07/2012 for the course MAN 6637 taught by Professor Kraft during the Spring '12 term at University of Florida.

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Brand_Inventory_FINAL12 - Heritage The name IKEA has become...

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