ikea in india case study

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IKEA Case study: Can IKEA adapt its unique service experience to India?

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Kevin Zentner , Rachel Killoh , Zhen Sun

Ikea is a worldwide success story; their stores were visited 915 million times and their website was accessed over 2 billion times in 2016 (Highlights, 2016). As the world’s largest furniture retailer, Ikea services a number of market segments. With significant volume discounts and a vertically integrated supply chain, the production of low-cost goods target young families and low income segments. Conversely, the flagship Stockholm line of furniture entices sophisticated consumers towards mid-priced, superior value products with quality materials such as walnut, bone china, and rustic grain leather.

Shahir Bhatt

Rationale: Retailing in India is evolving rapidly, indicated by increase in consumer spending at unprecedented rates and increase in number of global players investing in this sector. Private brands, which were once a small part of retailers’ merchandise, are occupying a significant portion of most retail operations today. For evaluating any retail store, the first thing customer takes into account is the brands (merchandize) it carries. This statement holds true in case of metro cities; however, a similar trend is evident in the young urban population of Ahmedabad as well. The current study attempts to discover the consumer perceptions related to private labels in apparels and its impact on store loyalty. Purpose: The study indicates the factors moderating the perceptions of customers towards private labels and tries to explore their impact on store loyalty. Design/methodology/approach – The data is collected using a self administered questionnaire. The sample size for the study is 305 respondents. The focal product was private label apparels sold in four retail stores of Ahmedabad district. Analysis has been done by using multivariate technique like Factor Analysis followed by one way ANOVA and Chi Square test. Findings – The factors for moderating private label perceptions include value, proximity, brand loyalty, familiarity, shopping exploration, sale proneness, store image and variety seeking behavior. Additionally it was found that value, proximity, brand loyalty, familiarity, shopping exploration and store image have relationship with store loyalty. It was also found that innovativeness and promotional offers have association with store loyalty. Research Limitations/implications - A key limitation of this study is the sampling frame. Future studies should replicate this study in different context. Keywords – Private labels (PL), Store Loyalty Paper type Research paper

Purpose – The purpose of this paper is to analyse the marketing strategy in China of the furnishing retailer IKEA in the context of standardisation and adaptation of marketing activities. IKEA's strategy in China is compared to its corporate strategy throughout the rest of the world. Design/methodology/approach – The four P classifications are used as a framework to compare the central marketing strategies of IKEA with marketing strategies used in China. The paper builds on both primary and secondary data. Interviews with senior managers at IKEA are conducted and studies on business and retailing in China are used. Findings – The marketing strategies used by IKEA in China are found to be different from the standardised strategies it uses throughout the rest of the world. Several of the changed strategies are central to the business concept of IKEA. Research limitations/implications – The present paper shows the challenges for a standardised marketing concept and its implications. Originality/value – The paper provides, in the context of the standardisation and adaptation of marketing activities, a more nuanced and up-to-date picture of the strategies used by IKEA compared to previous studies.

Hanaa Elsayad

The paper is a case study for the different types of risks faced by IKEA as the company started its operations in China. How the risks were mitigated, avoided or accepted has been discussed.

IKEA is often cited as an example of a 'global' retailer which pursues a similar 'standardized' approach in every market. This paper systematically assesses the degree of standardisation (and adaptation) of four commonly identified retail marketing mix activities – merchandise, location and store format, the selling and service environment, and market communication – within three countries. These countries – Sweden, the UK and China – represent different cultural settings and are markets in which IKEA has been operating for different lengths of time. The data upon which the comparison is based was generated from personal interviews, in-country consumer research, company documentation and third party commentaries. The conclusions drawn suggest that whilst IKEA operates a standardized concept, degrees of adaptation can be observed in customer facing elements, and in the supporting 'back office' processes which support these elements. These adaptations arise from differences in consumer cultures and the length of time, and subsequent exposure to and experience of, the market. This suggests that standardisation in international retailing should be considered from the perspective of replicating the concept, rather than replicating the activities.

Shyam Sundar

PAGE \* MERGEFORMAT 10 Modern retailing offers an ideal shopping experience through excellent ambience, merchandise choice and consumer preference analysis. Strong income growth, changing lifestyle and favourable demographics are the key factors for the rapid development of this sector. Education, global exposure, enhancing income level, acceptance of credit and smart cards might have effect on the shopping habits of Indian consumer (Baseer & Laxmi Prabha, 2007).Therefore it is essential for retailers to understand the motivational level of customer in order to attract them. Since consumers are attracted with more and more choices and this makes them to confuse ultimately on what to purchase. This in turn directs the consumer to deal with variety of seekers rather than brand loyalty. This leads the consumer to move from one brand to other or even to alternative product. In recent, this change has been mostly observed in Karnataka where the shoppers are exposed to several shopping formats that range from local Kirana's shop, supermarkets, convenience stores to hypermarkets (Anon, n.d.). The aim of this research paper was to investigate the impact of various individual factors on shoppers' behaviour in modern retail formats viz. hypermarkets and malls in Mangalore. Four independent variables viz. personality, pre-purchase information, shopping enjoyment tendency and buying intention are determined to examine the influence for the study. The data were collected from 210 valid responses. The outcome shows that pre-purchase information and shopping enjoyment tendency positively relate to shoppers' buying behaviour in modern retail formats in Mangalore. The study shows that the respondents are aware of modern retail formats; they prefer to shop, because they were getting pleasure while shopping. The study also reveals that both hypermarkets and malls were preferred by the respondents for shoppertainment.

Asian Journal of Research in Business Economics and Management

Narasimha Rao Manuru

Retailing in India comprises of two sectors viz. the organized and the unorganized sectors. The percentage penetration witnessed by organized retail in India is negligible, compared to some of its Asian counterparts like Thailand, Malaysia, China and Indonesia. Since the turn of the 21 st century, there have been certain factors that have contributed to the steady growth of organized retailing in India across all product categories and it is going to take a new shape with the entry of multinational giants facilitated by government policy of leveraging foreign direct investment (FDI) to allow 51 percent in multi-brand retail and enhanced cap to 100 percent in single brand retail. In view of these the corporate chains in Indian retail have to revive the strategies for sustainability through value offerings. The present study is focused on exploring the consumer perception of in-store marketing, store environment and staff role in buying situations at organized retail outlets in Vijayawada (tier-II) city, Andhra Pradesh.

anas nasrul