MKT 601 - Marketing Strategy

CONTEMPORARY
MARKETING

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EXECUTIVE SUMMARY
IKEA is one of the biggest firms in the furniture retailers in the world. It has become essential
for IKEA to understand the importance of different digital marketing tools. This report
highlights the two major target segments which this company wants to target with their
marketing plan. Along with this report will highlight the way in which IKEA has positioned
itself in the market. There are several strategic tools used by different firms but the three
major tools used by the firm in their digital marketing campaign. It also describes each one
these tools so as to illustrate its effectiveness. This report founds that company has focused
more on content or social media marketing measures. It also provides recommendations on
way company should build their marketing strategy in the coming future.

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Contents
INTRODUCTION......................................................................................................................2
Two major market segment of IKEA.........................................................................................2
Tools and techniques related to digital that is primarily used by IKEA....................................2
Strengths and weaknesses of digital marketing strategies.........................................................3
Recommendations......................................................................................................................4
CONCLUSION..........................................................................................................................4
REFERENCING........................................................................................................................4

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INTRODUCTION
Digital media has become one of the most powerful platforms to perform different types of
operations and so is the case with marketing. Retail companies like Ikea has to give their full
efforts towards developing their marketing campaign in such a manner that digital marketing
tools and techniques remains at the centre of the plan. Digital technologies also help the firm
in building marketing strategies that is extremely powerful and is able to attract large
numbers of customers towards their business (Charlesworth, 2014). Selection of tools must
be done with at most importance so as to ensure that their brand visibility is at the top. This
report shows the target segments that IKEA has made for itself in order to improve their
performance. Along with this it also illustrates about the positioning statement that company
has prepared for itself so as to attract these target segments. At last it illustrates about the
strengths and weaknesses of their digital marketing strategy.
Two major market segment of IKEA
IKEA have used different variables in the marketing so as to target different people from the
different sections of the society and so as to ensure that largest possible numbers of people
can be targeted with that variable (Chaffey & Smith, 2013). Among different market
segments made by IKEA, the two major market segments are on the basis of variable named
social class and benefit sought.
In terms of social class, they have targeted people from the low and middle class. In that too
they have concentrated on working class people. The have made their products according to
these people whose purchasing power is on the lower side. Apart from this, another major
target market of IKEA is the people that seek cost effectiveness. Their products are of high
quality and they are offering it at lower cost (Acar & Puntoni, 2016). This is done so as to
target people in both rural and urban areas. Apart from this they have also taken care of the
fact that most of the furniture companies have targeted people from the upper class. They
portray it as a luxury product.
In order to attract both these major target markets, they have positioned themselves as a
company that is offering furniture at lower prices while giving same amount of values that
other companies provide at higher prices (Lee & Carter, 2011). They have positioned
themselves one of those firms that provide high quality products at reasonable prices hence
they are able to attract both their major target markets i.e. people that sought cost
effectiveness or the people that from lower or middle class.
Tools and techniques related to digital that is primarily used by IKEA
IKEA being a bigger brand name has to take care of their marketing campaign. They select
their digital marketing tools seeking the fact that which tools or techniques would help them
in reaching to largest possible customers (Perrey & Spillecke, 2011). This is also based on the

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idea that their segmented market uses which marketing tool as their priority. Three tools and
techniques that are primarily used by IKEA are:
 Content marketing: This is one of the best marketing tools that can be used by any
furniture company. Content based marketing helps the company to reach to its
customers with the best of qualities they have. Contents include images, scripts,
videos and other type media. Content marketing is done by the firm so as to influence
the purchasing behaviour of the people. This is having the strongest effect on the
purchasing intention of the potential customers as it highlights the good points of the
company and also shows the way in which product is going to solve the problems of
the people (McNamara & Descubes, 2016). IKEA has hired a group of digital
marketing personnel that makes excellent and attractive contents. IKEA illustrates
about the quality of the products that is delivered by the firm especially the way in
which it resolves the problems faced by the firm. These contents are floated on
different platforms so as to ensure that maximum possible numbers of customers
could see it.
 Social media marketing: Numbers of customers that are attached with the social
media is very large and hence companies can easily find their target market at this
platform. This company uses the social media apps such as Facebook and Instagram
so as to increase their visibility. Apart from this company handles their social media
campaign with the help of dedicated employees. This tool is also used for collecting
data in the form of likes and comments. The data collected from this source is
analysed with the help of the social media analytics (Trendafilov, 2018). These data
are helpful in suggesting about the excitement of the people about any specific
products. The biggest benefit of using social media for digital marketing is that it
offers flexibility as any type of media can be uploaded on this platform. This is very
much crucial for bringing innovation in the marketing campaign which is essential for
attracting more numbers of people towards their business. Offers can be easily
communicated as well as it also helps in doing personalised marketing.
 Search Engine Optimisation: IKEA also takes use of the digital marketing tools such
as SEO so as to improve their visibility. Almost of their potential customers and the
targeted customers do take use of the search engines. In the age of digital business this
trend has increased to significant level. Company has hired Search Engine Optimisers
so that whenever the product is searched by the users on the search engines, their
name emerges on first (Teixeira, et al. 2018). This helps the company in increasing
the purchase chances as customers usually prefers to see the websites or pages that
appears on the top. This is beneficial in the case of all the type of retailers. It is
proving to be one of the best mediums on which marketing directly leads to increase
in the sale.
Strengths and weaknesses of digital marketing strategies
Digital marketing strategies that are used by the IKEA have certain kind of strengths and
weaknesses. These strategies are made citing the benefits they provide to their consumers.
Some of the strengths are as follows:

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 Their content marketing is very much powerful and shows all the attributes that are
positive in their products. It highlights the problems that are resolved by their
products (Sweeney, 2018).
 Their search engine optimisation techniques are effective especially when compared
with their competitors. This helps them in giving competitive advantage over the
others (Tarnovskaya & de Chernatony, 2011).
 They have a team of digital marketing personnel who are highly skilled and are
efficient in managing the changing business environment. It is seen that people that
are from the local cultural backgrounds are often hired in then team so as to make the
strategies more helpful.
 They are known for their innovative style of marketing on different digital platforms.
Weaknesses of the strategies are as follows:
 Their marketing is limited for certain areas in the world which reduces their power to
expand in the international market especially the markets that are not very much
developed.
 Their digital marketing strategies are not very much aggressive when compared with
other big furniture manufacturers (Dessy, 2017).
 IKEA’s digital marketing strategies lack bigger fan pages or follower when compared
with other competitors.
Recommendations
Analysing the strengths and weaknesses of the company, it can be recommended that the
company should focus more on using artificial intelligence in their digital marketing
strategies. This is essential for improving the quality of the marketing campaign. More data
based marketing can be done with the help of AI. Company should also consider the tools
such as YouTube for improving the marketing campaign. It can upload the experience of
their customers so as to increase the trust in their potential consumers. YouTube
advertisements along with personalised marketing can be beneficial for increasing the interest
of the people in their products (Oleoshop, 2018). It is also recommended that data must be
protected during digital marketing strategies as competitors might attack on this data and
steal the crucial information. Company could also enhance their visibility at other e-
commerce sites so as to increase the chances of sale. It will also help the client to find the link
to the site from where they could make the purchase.
CONCLUSION
From the above based report, it can be said that IKEA is one of the biggest furniture retailers
in the world. IKEA has targeted people who have affinity for cost effective products and the
people that are from the lower and middle income class. In order to target these people
company has positioned itself as a firm that offers quality products at reasonable prices. They
use social media, search engine optimisation and content marketing as their primary tools and
techniques for digital marketing. Their strategies are more focused towards using content and

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social media for increasing the sale. Their online marketing strategy is empowered by strong
search engine optimisation. On the other hand it has weaknesses that their digital marketing
campaign has not reached to other parts of the world.
REFERENCING
Acar, O. A., & Puntoni, S. (2016). Customer empowerment in the digital age. Journal of
Advertising Research, 56(1), 4-8.

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Chaffey, D., & Smith, P. R. (2013). eMarketing eXcellence: Planning and optimizing your
digital marketing. Routledge.
Charlesworth, A. (2014). Digital marketing: A practical approach. Routledge.
Dessy, N. 2017. Ikea’s Unique Digital Marketing Strategy. Retrieved from:
https://medium.com/@nicholasdessy/ikeas-unique-digital-marketing-strategy-
92bba458c92
Lee, K., & Carter, S. (2011). Global marketing management. Strategic Direction, 27(1).
McNamara, T., & Descubes, I. (2016). Can IKEA adapt its service experience to
India?. Emerald Emerging Markets Case Studies, 6(1), 1-14.
Oleoshop, 2018. IKEA online strategy: what to learn from the Deco line giant. Retrieved
from: https://www.oleoshop.com/en/blog/ikea-online-strategy-what-to-learn-from-
the-deco-line-giant
Perrey, J., & Spillecke, D. (2011). Retail marketing and branding: A definitive guide to
maximizing ROI. John Wiley & Sons.
Sweeney, E. 2018. Ikea refreshes marketing with experiential, digital push and fewer print
catalogs. Retrieved from: https://www.marketingdive.com/news/ikea-refreshes-
marketing-with-experiential-digital-push-and-fewer-print-ca/529279/
Tarnovskaya, V. V., & de Chernatony, L. (2011). Internalising a brand across cultures: the
case of IKEA. International Journal of Retail & Distribution Management, 39(8),
598-618.
Teixeira, S., Branco, F., Martins, J., Au-Yong-Oliveira, M., Moreira, F., Gonçalves, R., ... &
Jorge, F. (2018, June). Main factors in the adoption of digital marketing in startups an
online focus group analysis. In 2018 13th Iberian Conference on Information Systems
and Technologies (CISTI) (pp. 1-5). IEEE.
Trendafilov, D. (2018). Design incorporated: IKEA as personal experience. Punctum.
International Journal of Semiotics, 4(1), 165-178.