IKEA’s Brand Analysis

IKEA’s Brand Analysis

JIANG Chunyu 1155080917

Ø  IKEA: A Well-known Brand

IKEA is a privately-held, international home products retailer that sells flat-pack furniture, accessories and bathroom aa well as kitchen items in their retail stores around the world. As is show on the Forbes List, IKEA is not only one of the world's most successful retailers, but also a powerful brand.

The brand has been in the U.S. for more than 30 years. And there is a surprisingly high awareness of the name. It is sure IKEA might be an iconic brand but it’s not their size, their logo or their buying power that keeps customers coming back. What is it that makes IKEA so irresistible to the millions of people who shop there every week? What makes them the biggest furniture retailer in the world? How IKEA would be so successful when designing its brand?

In this short article, I’ll give a brief analysis of this brand.

Ø  Purpose: Profit/Value

The fact is the IKEA isn’t actually in the furniture business, they are in the aspiration business. They sell us a story that we want to believe. It’s a story about “loving where we live”. Specifically:

--IKEA’s vision statement is “To create a better everyday life for the many people.”

--IKEA’s mission statement is “To offer a wide range of well designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them.”

--IKEA’s market positioning statement is “Your partner in better living. We do our part, you do yours. Together we save money.”

So we can see that although making money is important to almost every business, we admire brands that emphasize their willingness to achieve more than just profitability, like IKEA. IKEA's vision isn't just to sell furniture, but rather, to "create a better everyday life." This approach is appealing to potential customers, as it demonstrates their commitment to providing value beyond the point of sale. What’s amazing is that this huge, slightly irreverent brand seems to understand us. They know that our dreams are the oxygen of any shopping experience. Not only do they allow us to dream but they positively encourage it. Their room displays say: “This could be your place. Take your time, wander through, let the kids jump on our sofa’s, make yourself at home.”

Ø  Unique selling point

As one of the world’s largest home furnishing retailer, IKEA is famous for its Scandinavian style. The USP (unique selling point) of the brand that truly sets itself apart is the flat-pack and assembly-by-consumer style of furnishing. This model reduces costs and gives way to convenience for a shopper who wishes to enjoy furniture purchase experience with their family.

It’s been six decades since IKEA has focused on home furnishings but the brand still has a keen emphasis on improving its service and a knack for design innovation. Since IKEA caters to the requirements of a huge population worldwide, it cannot do so without finding out what the customer wants. Keeping that in view, IKEA is involved in an ongoing research to explore consumer lifestyle now and shape it for the future. In order to modify consumer perceptions according to popular design trends, IKEA has to focus on design solutions for modern and compact homes.

Ø  Loyalty

IKEA is a brand with high respect but relatively low customer loyalty. IKEA consumer loyalty is based on the criteria of price and distance. Customers favor IKEA mostly based on their low price advantage. Counting the customer on low price strategy is not stable, consumers are likely to choose other brand when there is other lower price product or having more budgets. On the other hand, IKEA has strong community and strong brand engagement.

Ø  Differentiation

Regarding the five dimension of brand personality (sincerity, excitement, competence, sophistication, ruggedness) IKEA owns the personality as below:

·          Sincerity: honest, cheerful

·          Excitement: spirited, imaginative, up-to date

·          Competence: intelligent, successful

The differentiation points of IKEA include: flat pack, life time guarantee, low price and DIY (Do-It –Yourself). Nowadays the advantage of low price is still keeping IKEA as the leader of the market.

Ø  Brand Awareness

Brand awareness is based on brand recognition and brand recall. Brand recognition is based on the fact that a consumer is able to identify a brand just by viewing the brand’s logo, tagline, packaging or advertising campaign.

For brand recognition, IKEA is doing a lot of advertising campaigns which allows this brand to enter in the mind of customers. The brand recall is what customers quote as the brand automatically coming to mind when thinking of a product category.

There are so many reasons that make IKEA so popular, for example, cooperating with the suppliers from all over the world, high-efficiently of logics, using “life system” to find what customer need, and so on. Follow the concept, IKEA try their best to give the customers what they promised: low price, well-design, creating a better everyday life for many people. So it is obvious that with the help of their correct branding strategy, IKEA is becoming a clearly a beloved brand in the market with a very powerful connection to their consumer. IKEA's forward-thinking branding strategy made it the top furniture seller in the world.

Reference

How IKEA Designs Its Brand Success

http://www.forbes.com/sites/deniselyohn/2015/06/10/how-ikea-designs-its-brand-success/#5ce8f0203901

5 lessons in positioning from Ikea’s brand strategy that are applicable to your marketing strategy

https://merkelijkheid.nl/positioning-ikea-brand-strategy/

Today's Most Innovative Company: Ikea Uses Augmented Reality To Show How Furniture Fits In a Room

https://www.fastcompany.com/3014930/most-innovative-companies/todays-most-innovative-company-ikea-uses-augmented-reality-to-show

Ikea's Strategy For Becoming The World's Most Successful Retailer

http://www.businessinsider.in/Ikeas-Strategy-For-Becoming-The-Worlds-Most-Successful-Retailer/articleshow/45904642.cms