Marketing and Operations Management at IKEA

Running Head: MARKETING AND OPERATIONS MANAGEMENT
Topic- Marketing and operations management at IKEA
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2SHAPING BUSINESS OPPORTUNITIES
Introduction
IKEA the Swedish Furniture giant is one of the examples of a successful retail business
enterprise. It has unique ‘IKEA Concept’ strategy support both in its marketing and operational
contexts. Its global presence has added to its competitive advantage over its equivalent market
competitors like Walmart, Amazon and Tesco Jonsson, Rudberg and Holmberg (2013, pp.337-
350). Here the main competitive strategies of IKEA are discussed first followed by marketing
and operational strategies. And lastly, the relationship between the three is defined.
Competitive strategies
The competitive strategies of IKEA focus basically on store layout and product display.
The unique approach of self-service and extensive furniture display makes it unique among its
competitors Jonsson, Rudberg and Holmberg (2013, pp.337-350). Also, its uniquely designed
warehouse next to the tills provide the customers the opportunity to take the unassembled packed
products home where they can assemble them on their own. Products are designed based on
consumer demand and ongoing market trends. IKEA is able to offer low prices to its’ customers
because of the right combination of economies of scale and technological integration in core
business processes Venter, Wright and Dibb (2015, pp.62-83). Daily needs of consumers are
emphasized and attractive, functional, affordable and reliable furnishing solutions are provided
to them. Long term sustainability is the main aim of IKEA and its business objectives are defined
in line with the main aim.
Marketing strategies
Focusing on the marketing strategies it is quite evident that in IKEA the best furnishing
solutions are provided at the lowest cost. Low prices of products are the key to IKEA’s global

3SHAPING BUSINESS OPPORTUNITIES
success. In addition to this the company continuously updates and improvises its products to
match the current customers’ expectations, preferences and lifestyles Jonsson, Rudberg and
Holmberg (2013, pp.337-350). The target market is quite large and it includes every household
ranging from middle-income groups to high-income groups. The marketing mix of product,
price, place and promotion are integrally designed so that the target market can be reached out
effectively Dibb and Simkin (2016, pp.251-279). The products are households’ daily essentials
ranging from furniture, bedroom accessories, kitchen appliances, bathroom accessories, children
need and many such items. Unassembled flat-packed products are provided to customers and
they can either assemble on their own or can take the help of IKEA technicians. The cost
effectiveness is one of its core success strategies, the prices of items are kept low so that larger
part of the community can afford them Gummesson, Kuusela and Närvänen (2014, pp.228-240).
Almost every country has one IKEA store and its global reach has made its business so
sustainable. The store sites are chosen keeping catchment area maximization approach in mind
where the convenience of the shoppers is also maximized. Popular areas are chosen for store set
up in order to grab higher attention of the public. Display name is quite larger and the unique
blue-yellow color combination help it to be better recognized among many others. The
promotional philosophy is based on ‘style without expense’ and the name ‘IKEA’. Its overall
marketing strategy is forceful and well-directed by the support of well-articulated marketing mix
required for managing its vast superstore operations.
Operational strategies
The operational management strategies in IKEA are also remarkable contributors in their
success map. IKEA is efficient in managing its operational networks that emphasis on design,
products and delivery of market fit products and services De Giovanni (2013, pp. 125-148). The