IKEA Group

In 2002, IKEA was declared the most valuable brand in the world. This paper examines opportunities for IKEA to expand its market strategy (Moon, 2004, p. 1). IKEA's sales have been increasing by 1 billion since 2000 showing static sales movement for the company. Internal research should be conducted to analyze if sales are a result of continuing or new customers. In 2002, the furniture retailing industry generated 67 billion dollars of sales in the U.S. (Moon, 2004, p. 6). There is a tremendous market potential for IKEA in the U.S. that it is not reaching. The research can provide insight into effective ways of targeting old and new customers. Programs can develop to engage including loyalty programs, rewards cards, and more.

Furthermore, the group needs to focus on crafting an image of itself for the American consumer. In their first store they opened in Philadelphia they noticed that Americans didn’t like their products because they weren’t comfortable, and they had reluctance in buying furniture overall (Moon, 2004, p. 7). If IKEA were to partner with locally known brands its entrance strategy could’ve been based on its findings in that collaboration. Global brands still need to familiarize themselves locally.

Lastly, IKEA Group should find ways to distinguish itself from its competitors that range from Walmart to Costco. To gain a competitive advantage in the U.S. the company should leverage its unique Scandinavian designs via a cultural revolution with an understanding of American culture and its relationship to furniture shopping. Additionally, IKEA should consider giving customers access to products or services it hadn’t before. This would allow for consumers to distinguish between IKEA and other top furniture retailers. In conclusion, the three recommendations made above are meant to add to IKEAs current market strategy as it continues to grow as a global force.

Reference

Moon, Y. (2004). IKEA invades America. Harvard Business School.