Competitors
IKEA doesn’t have many direct competitors because of their unique Ikea experience and the fact they are ‘category killers’ in terms of industry based on price and quality. Their indirect competitors in house wares and furnishings however are big box stores like Walmart and Target. Both of these competitors have begun offering flat packed furniture, like IKEA, however the sections are confined to small spaces in these large stores.
Crate and Barrel on the other hand, which is actually a part of Euro Market designs Inc. Is one of the closer competitors to IKEA in terms of variance of products offered as well as marketing strategy and management style. Crate and barrel has tried to position themselves as a more “grown up” IKEA. Crate and Barrel paints IKEA as your freshman year in college, your first job, the apartment, you share with three strangers you met on Craigslist, while Crate & Barrel is growing up: housewarming gifts, engagement parties, wedding registries and dinner parties. This strategy has carved out a nice niche for Crate and Barrel, but IKEA is still viewed as the preferred brand
How IKEA Stands Alone
IKEA’s devotion to Environmental design allows designers, product developers and technicians to consider a product’s safety, quality and environmental aspects, from the initial design stage throughout the product life cycle.
IKEA uses their “e-wheel” to understand and evaluate the environmental impact of their products. The “e-wheel” has several checkpoints, which are divided into five phases: raw material, manufacturing, distribution, use and end of life. IKEA believes in using the fewest resources to make the best possible products, without having a negative impact on their functionality or appearance. The main raw materials used in IKEA products are wood, cotton, metal, plastic, glass and rattan, IKEA tries to use as many renewable and recyclable materials as possible. IKEA works actively to reduce waste in manufacturing. Where possible, waste from one manufacturing process is used in the production of other items. IKEA recycles large quantities of material to deflate raw materials costs. Most IKEA stores provide collection points for customers to return waste, such as electrical and electronic equipment, discarded packaging, spent batteries and low-energy bulbs, for recycling. IKEA then attempts to repair products rather than simply discarding them. These products are used as spare parts or sold at reduced prices in specially designated areas of the stores. Finally, IKEA applies precautionary principles with regards to the use of chemicals and other potentially hazardous substances in their products. For example, in instances where local laws are strengthened regarding the use of chemicals, IKEA strives to adopt the new requirements in other countries where they do business as well.
The Essay on Ikea Product and Service Value Strategies
As the world’s largest furniture retailer, IKEA is known for its product’s value, in terms of quality, style, affordability, functionality and durability. Their appliances and furniture is designed base on modern architecture and associated with eco-friendly interior design. Moreover, the company is known for its affordable products with highest quality and products with many functions inside. ...
The IWAY code
The IWAY was first introduced in the year 2000.
IKEA’s code of conduct, The IKEA Way on Purchasing Home Furnishing Products or IWAY, defines what suppliers can expect from IKEA and specifies what IKEA requires from its suppliers. The IKEA Way on Purchasing Home Furnishing Products, (IWAY) is based on international conventions and declarations. It includes provisions based on the United Nations Universal Declaration of Human Rights, the International Labour Organization Declaration on Fundamental Principles and Rights at Work, and the Rio Declaration on Environment and Development. It covers working conditions, the prevention of child labor, the environment, responsible forestry management and more. Suppliers are responsible for communicating the content of the IKEA code of conduct to co-workers and sub-contractors and ensuring that all required measures are implemented at their own operations.
The Report on How Does Ikea Generate Customer Loyalty
How does IKEA generate customer loyalty? Customer loyalty is continued business by attract the right customer, get them to buy, buy often, buy in higher quantities and bring you more customers. IKEA use low price, fashionable design and providing better service to generate customer loyalty. Most items from IKEA are boxed and required customers complete the furniture at home, this can saved the ...
In short he IWAY was developed to ensure that all IKEA products were produced responsibly and so that as consumers, we feel no guilt when buying an IKEA product.
The IKEA Experience
IKEA stores are typically large blue buildings with yellow accent, to hint at their Swedish roots. They are typically designed around a “one-way” layout which leads customers along “the long natural route.” This layout is designed to encourage the customer to see the store in its entirety (as opposed to a traditional retail store, which allows a consumer to go right to the section where the goods and services needed are displayed) although there are often shortcuts to other parts of the showroom. The sequence first involves going through furniture showrooms making note of selected items. Then the customer collects a shopping cart and proceeds to an open-shelf warehouse for smaller items.Then the customer visits the furniture warehouse where they collect previously noted showroom products in flat pack form. Finally they take their products to the cashier’s station to make payment.
The IKEA stores are designed to show all customers everything IKEA has to offer. On the top floor, or showroom floor, customers can simply walk around hands free and enjoy the ideas that IKEA has come up with. In the showroom customers only need a piece of paper and pencil to make note of what products to buy, getting rid of the hassle of pushing around a shopping cart. Once all selections have been made the customer picks up the corresponding item, which is packed away flat and unassembled so that the customer can easily transport the item home. Some joke that anyone who enters an IKEA will buy something just based on the amount of time that is typically spent inside of one.
Sales and Operations planning
By definition Sales and operations planning (S&OP) is an integrated business management process through which the executive/leadership team continually achieves focus, alignment and synchronization among all functions of the organization. The S&OP plan includes an updated sales plan, production plan, inventory plan, backlog plan, new product development plan, strategic initiative plan and resulting financial plan.
In regards to Ikea…Consumers flock to their stores in order to purchase highly stylized, well-made, cool, and cheap home furnishings and accessories. The reason Ikea’s been so successful in delivering high quality/high design, low cost products to the market is that they begin with the price of an item. When their designers sit down to create a chair for instance, they decide they want to design a dining room chair that will sell for $59.00. Then, they go about designing the very best chair they can make for that price.
The Business plan on New Product Launch Marketing Plan 3
New Product Launch Marketing Plan, Part I New Product Launch Marketing Plan, Part I International: Fiat Market Needs and Market Growth “Vehicle shipments in NAFTA totaled 2,238,000 units for FY 2013, representing a 6% increase over FY 2012. In the U. S. , vehicle shipments were 1,876,000 (up 7% from FY 2012), in Canada 269,000 (up 5%) and 93,000 for Mexico and other. ” (Fiat 2013 Full Year Q4 ...
What’s unique about this approach is that other companies design a chair, figure out it costs, say $119, and then start stripping it down to get the cost to $59; resulting in a cheap, often badly made chair. In other words, the brilliant idea Ikea had was to begin with their goal (a specific price) and then work outwards. Ikea doesn’t begin any design or planning work until they have agreed upon their product’s price and goal.
Sales and Operations planning (cont)
Ikea believes that a strong in-stock position in which the most popular style and design trends are correctly anticipated is crucial to keep satisfied customers. For that, Ikea depends on leading-edge technology.
According to Ikea’s logistics manager, “there are a lot of Just-In-Time concepts built into
how IKEA is trying to do business.” Ikea has developed its own global distribution network By utilizing control points in the distribution cycle, the firm is able to insure timely delivery of products to retail stores all over the world.
Ikea has over 1,800 suppliers located in over 50 different nations.
Ikea’s, marketing manager believes that Consumer tastes are merging globally. Together with innovative changes in the value chain, where consumers become Pro-sumers and suppliers are turned into consumers, the concept of marketing high quality products at low cost through a focused generic strategy, intended for the globally emerging middle-class has served Ikea well. Centralized control and product standardization are two necessary components of IKEA’s long-term strategy
The Research paper on Ikea Product Life Cycle
| Nike’s Business Level Strategy | Case Study Assignment #2 | | Andreea Mosailov | 11/11/2011 | | Case study assignment # 2 Nike’s Business Level Strategies, P 142/3 1. What business level Strategies is Nike pursuing? One of the strategies utilized by Nike in the past was the focused strategy; the company concentrated on producing basketball and track shoes but after its sales began to fall, Nike ...
