Marketing and Operations

Running head: MARKETING AND OPERATIONS
MARKETING AND OPERATIONS
Name of the Student
Name of the University
Author Note

MARKETING AND OPERATIONS1
Introduction and about the company
Ikea is a Swedish multinational company that mainly designs and offers the ready-to-
assemble furniture, home accessories, kitchen appliances and many other occasional services
as well. Ikea has gained a position of the largest furniture retailer since the year 2008. Ikea
was established in the year 1943 by a carpenter of 17 years of age Ingvar Kamprad. The
founder of Ikea was listed by the Forbes magazine among top 10 richest people. The net
worth that has been developed by Ingvar Kamprad is greater than 40 Billion Dollars
(Ikea.com 2019).
The essay will be based on the strategies that have been implemented by Ikea in the
industry that includes, the competitive strategy, the marketing strategy and the operations
strategy. The relationship between the strategies will also be analysed in the essay in detail.
Competitive strategy at Ikea
The competitive strategy that has been implemented by Ikea in the industry is a mix
of low prices and differentiation. The customers of Ikea are provided with major options to
choose the desired furniture and assemble them according to their personal demands and
needs. The consumers need to visit the stores and collect the required furniture that can later
be assembled according to their requirements (Bang, Joshi and Singh 2016). The prices that
are set for the products are also lower in comparison to the competitors. This factor is able to
play a major role in the ways by which Ikea is able to maintain an advantage over the
competitors in the furniture industry. The products of Ikea are tailored in an effective manner
based on the demands and needs of the consumers. The differentiation of products is also
based on the ways by which the furniture is tailored according to the needs of customers
(Jackson and Ahuja 2016).

MARKETING AND OPERATIONS2
Marketing strategy at Ikea
Target customers - Ikea has implemented different types of segmentation strategies
that help in dividing the customers in various groups. The demographic bases are applied by
Ikea in order to decide the target market. Psychographic and behavioural segmentation
process is implemented by the organization in order to maintain its profitable operations in
the industry. The company aims at providing high value to the customers with the help of its
signature products and best prices. The major target customers of Ikea include the group of
people who provide importance to the attributes that are offered by the products (Jensen,
Cobbs and Turner 2016).
Marketing mix of Ikea –
Product – The furniture based products that are designed by Ikea are developed based
on the strategy of “Do It Yourself” or DIY. The products of the company are not pre-
assembled, on the other hand, they are designed with respect to the choice of consumers. The
flat-pack distribution based channel is implemented by Ikea Group for helping the customers
to transfer the products from the stores to their homes. Ikea has shown huge concern for
individual requirements of the consumers who are the most important part of its operations
(Shams 2016).
Price – The prices of the products of Ikea are kept within the affordable range in order
to face the competitors. The large-scaled economies have been used by Ikea in order to make
to long term contracts with the producers in order to lower the prices. The packaging of
products is done by Ikea with the help of recyclable cardboard based materials in order to
lower the costs based on production (Sinapuelas, Wang and Bohlmann 2015).