IKEA's Competitive Marketing Strategies

This assignment examines IKEA's marketing strategies within the context of a competitive business environment. It explores how IKEA aims to fulfill consumer needs, giving them a competitive advantage. The analysis is supported by various academic sources and industry publications.

Marketing Essential

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1 Key roles and responsibilities of the marketing functions................................................3
P2.Way in which roles and responsibilities of marketing in respect of organisational functions
................................................................................................................................................6
TASK 2............................................................................................................................................8
P3 Comparison of marketing mix of IKEA and ALDI..........................................................8
TASK 3..........................................................................................................................................12
P4 Produce and evaluate basic marketing plan for an organisation.....................................12
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................16

INTRODUCTION
Marketing can be defined as the process which is significant for functioning of operations
and management. This is paramount procedure which comprises distribution, production,
promotion and allotment of services and products in order to earn more consumer. By selection,
development, identification or selection procedure which helps in setting the strategy and
distribution channel, this strategy can be conducted (Asaduzzaman, Hossain and Rahman, 2014).
This is fundamental for enterprise consumer for informing individual in regard of commodity
features as well as influence USP for persuading buyer to make purchase decision. In the recent
era, this has become more fundamental to coordinate strategies of distribution as well as
promotion.
This report will focus over various aspects of marketing essential in context of given
organisation. It will assess a proper marketing report on IKEA that is one of Dutch based
Swedish founded company which render kitchen appliances, furniture as well as home
accessories. For this purpose, various responsibilities and roles in internal as well as external
working environment will be evaluated. Henceforth, after analysing these, proper development
of marketing plan will be prepared in regard of services and products of organisation.
TASK 1
P1 Key roles and responsibilities of the marketing functions
Marketing can be considered as the procedure of interesting clients and consumer in their
services and products. This is a huge concept which avail in retaining and attracting a growing
level of satisfied clients. As IKEA is a large organisation that sales their commodities in
international market, this is significantly concerned with requirements of serving many
individuals. Marketing process can help in seeking consumer segments through proper marketing
research of external and internal environment of company (Which are the 7P's of Marketing?,
2016). The company has always been concerned about client's choice and demands according
which they provide practical, beautiful and low cost furniture products and home appliances. In
highly competitive business environment, aiming over consumer needs which can render proper
edge to company. IKEA opt the consumer-driven strategy of marketing which can help them in
considering numerous elements. For this, they target their market, build loyalty, opting feedback
of consumer as well as gaining referrals that can help in setting consumer.
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Marketing concept is fundamental for development of an enterprise in competitive
industry so as IKEA. There are numerous activities which a company organise for proper
evaluation as well as better service quality in significant style. Marketing can be considered as
the operational and promotional activities that are implemented to promote products as well as
enlarging products and services (Clow and James, 2013). As per the definition of American
Marketing Association, 'Marketing is activity, institution designing procedure, distribution,
interaction as well as offering deals i.e. valuable for partner, clients, consumer as well as society
on mass level.' This is essential for IKEA to accumulate data of marketing concept basic to
accumulate information related to this. Here are mentioned some of the major marketing
concepts:
CONCEPT OF MARKETING: Marketing concept is based on five major elements i.e.
explained as below: Product Concept: This is based on the organisation's operation in which this is claimed
that clients majorly prefer available and inexpensive services render by organisation. Product Concept: Consumer make purchase decision for those products that deal with
quality, favourable performance as well as creative features. This claims that consumer
are more dedicated for those companies which offer wide varieties of services at one
place. Selling Concept: This concept is based on marketing that claims that more advertised
products has more sales in comparison to non-promoted. Marketing Concept: It is stated that through branding and strengthen company's
recognition, organisation can attract more buyers as consumer prefer credible
organisations.
 Societal Marketing Concept: It is claimed in this concept that despite of selling service,
organisation should aims over behaviour of target market as well as their interest.
IKEA operated marketing as the major tools of disseminating their commodities and
activity's information to their public. Here are briefly explained marketing functions i.e.
explained as below: Product Development: Organisation evaluate market trends and consumer demands in
order to produce commodities according to new scenario. The process of product
development is undertaken in regard of achieving consumer's attention and sustaining in
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market. Market is dynamic that keep varying in terms of sustaining and evolving in
competitive industry. The process aid in evolution of existing products through adopting
innovation monitoring NDP procedure for improvising activities. Market Research: For developing new strategy and plan within business environment,
this is essential to investigate recent market scenario, business environment as well as
company's positioning. This assist in making evolution and developing appropriate
strategy of business as per the condition of company. It help in understanding weakness
and threats of organisation and determining major opportunities and strengths through
conducting market research in more suitable and effective strategy. It is very fundamental
element that determines environment, consumer preferences, choice, market trends,
advance technologies and means of promotion that can be used by company. Hence
marketing techniques and research is helpful for making proper evolution as per
requirement of enterprise. Strategy: Management of company design as well as form plans, programs, structure,
goals and target market of company (Desai, 2013). By stimulating client to make
purchase decision, organisation can meet the determined consumer base with the
assistance of effective strategy execution. IKEA need proper research, market analysis
and promotion tools in order to implement determined technologies as well as changes in
more efficient manner. Sales: A business is relied on sales of their services and products for which they execute
various plans, operations, procedures as well as processes. By the assistance of proper
promotion, marketing, message conveyance, sales can be enhanced in effective manner,
The organisation's income is depend on sale amount that is directly related to revenues
and profitability of company. Marketing is directly linked with this as it aid in carry out
different plans, vouchers, offers that can maximise their services sale.
 Communication: Management of communication is as essential functions that marketing
manages as other. It assist in creating more sales, attracting service users and potential
consumers, controlling issues and managing brand image. The major marketing focus is
to maintain the practices related to interaction via personal selling, publicity, advertising
by which organisation can influence their buyer to make purchase decisions. In order to
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manage effective and proper communication using suitable media tools opt by target
consumer in order to achieve the target in more significant style.
B2B can be defined as marketing methods or techniques that is used by different
organisations in different manner (Wirtz, 2012). B2B refer to business to business deals or
trading. Whereas in B2C, business organisation trade their commodities with consumers or
clients for financial asset or exchange.
P2.Way in which roles and responsibilities of marketing in respect of organisational functions
Marketing is fundamental aspect that can assist in developing company in efficient
manner. Through this help, organisation can emphasise their profitability and sales. This can be
consider that this sector can help in advertising, promotion, segmentation of market, achieving
aimed position and target consumer etc. Manager has a huge role in the marketing and promotion
of organisation.
In companies like IKEA, company's manager perform various duties through conducting
research and survey as per it, who accumulate different information and data in regard of trends
and situation of market. They can collect information as per consumer choice, demands, choices
and preferences of consumer evaluating recent condition in order to produce more effective and
demanded products according client (How to use the 7Ps Marketing Mix?, 2017). Management is
liable to undertake the process of decision making for evolving creative quality and ideas of
services and products. This is require to focus over creative concept or suitable strategies in order
to promote their commodities in market. IKEA provide wide varieties of home appliance as well
as furniture. This is essential for company to comply suitable techniques and ideas for achieving
business objectives as well as enhance worker's skills. Here are mentioned some of major
marketing roles and responsibilities i.e. interrelated with other division and functions of
organisation help in achieving competitive edge: Research & Development: This can be determined as per the study that marketing
department is directly linked with research and development division of IKEA. R&D
activities of any company must be related very closely to product development and
marketing activities of company. It help in adopting new product, innovation of existing
services as well as methods or techniques that can help in achieving business objectives.
This organisation always aims on research increasing their services along with rendering
better quality which can help in competing their rivals as well as gaining more
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consumers. Through the assistance of market research, IKEA's marketers can gist over
entire information and incurring of market along with implementing suitable techniques
in better manner. Transportation Facilities: Organisation need to utilise effective transportation facilities
as well as distributing services and products in order to target their audience. According
to this, product transformation can be met through using effective techniques and
marketing tools that can save time or proper resource consumptions. IKEA utilise Just-in-
time strategy in order to outward and inward management for service and food
production. Risk Factor Assessment: In the determined several hazards or risks which can incur
while business operation as organisation has to cope up different condition or hazards
like external and internal factors which is required to analyse in order to create more
effective strategies. This directly influence worker's productivity and performance for
attaining objectives and goals of business. Hazards can obstruct the process of growth
and evolution. IKEA manager need to analyse forces as well a trying to decrease it for
further successful implementation of activities. Better Service and Product Quality: It is fundamental function according which
marketers make certain about the service and product quality of company as well as
influence them in effective manner (Fazlollahtabar, Aghasi and Forte, 2012). This assist
IKEA in achieving their long term objectives through achieving strong market position as
well as focusing over the quality. Product Development: Another function of an organisation is product development as
per trends and demands of consumer. This element support IKEA's brand image and
create value among consumers in better style. The sited company involve their individual
development and research division where they analyse different situation of market as
well as manufacture innovative services and products through undertaking expectation
and desire of consumer. Company invest approximate more than 15% of their earning
over research and development Dept. with purpose of new ideas and features invention or
innovation. Human Resource: This is fundamental to involve human resource as they are the major
asset which has vital role in sales increment as well as generation of higher revenues
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through the assistance of service and product range. IKEA company's HR perform the
program of training and development for emphasising abilities and skills so that they can
perform in better way. They can recruit applicants for division of marketing through
selecting and recruiting best individual that can support in increasing organisation's
productivity. Consumer Service: Consumer service is one of major vision of IKEA according which
different plans and strategies are being implemented in company. Organisation has been
conducting different research programs, marketing methods and business strategy in
order to achieve the business objectives in more significant manner. Firm is focusing over
demands and consumer requirements through developing trends and campaigns of
marketing.
 Management: Manager of IKEA company determines which product different procedure
and policies that must be complied through each and every individual. Hence, marketing
manager aims on execution of entire rules or regulations in order to manage the working
environment (Gertner, 2011). Hence, code of conducts and effective rules must be
determined by company that affect company's sales amount.
TASK 2
P3 Comparison of marketing mix of IKEA and ALDI
Marketing mix can be defined as the tactics or actions set which an organisation utilise in
order to promote their company as well as market products. A designed or planned mix refer to
the controllable components of marketing plan of product. An extended marketing mix elements
consist of promotion, place, price, product, physical evidence, process and people. IKEA deal
with wide product range, functioning furnishing products of home at low and affordable cost.
The target market of organisation is very broad. In order to expand the business and develop
effective marketing method, organisation need to execute a proper marketing mix of company to
major competitor of organisation. ALDI is supermarket chain which provide wide range of
services and products. Through comparing this, organisation can analyse major difference
between both them. Here is presented comparison of marketing mix of above mentioned
organisation:
Marketing Mix IKEA ALDI
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Elements
Product Products are considered as heart of
marketing strategy, this can state
that core products that meet initial
requirements as well as components
supplementary that value enhance
products. There are wide variety of
services and products including
chairs beds, baby care products,
desks, cooking items, bathroom
stage and many other. This help in
achieving business objectives in
significant manner.
Aldi is popular and one of largest
supermarket chain of United
Kingdom that provide various
services and products in market.
This is one of largest retailing
organisation which interlude
apparels, fruits and vegetables
beauty and health products
stationery etc. Organisation is
popular for their cost effective
strategy of trading service in market.
Price The company has adopted several
different strategies of pricing which
is major strength of organisation
that makes it different from its
competitors (Hamilton, 2011). The
company determine their service
cost analysing their competitors in
order to achieve mass consumer
number toward company. Firm has
been enlisting one of major leading
or emerging retailing organisation in
United Kingdom. This has
attempted major attention of
consumer as the cost-effective
strategy is more efficient and
suitable as per organisation
condition. This can only be
ALDI is popular for their cost
effective product strategy and
quality of services and products that
has lead enterprise to success and as
one of largest retailing organisation.
The organisation focus over selling
the services and products in more
effective style. Company use
premium strategy of costing in order
to attract maximum buyer for certain
service and product. The company
also undertake various cost actors
which company undertake market
penetration, cost leadership, pricing
strategies, with the purpose of
generating more revenues and
benefits in effective style.
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achieved through systematic
tracking entire operation and control
over activities of company.
Place This can be defined as geographical
area or place where consumer can
access products and service
rendered by organisation. Sited
company use effective distribution
strategies in order to make more
availability of service in the
competitive market. The company
has stores in more than 50 nations as
well as has online website where
consumer can make purchase
decision through online process.
Organisation is more than 8000
supermarket stores at international
marketplace rendering effective
services and products. Company
also provide online services and
products on their official websites
for convenience of consumer and
making purchase procedure more
easier. Through expanding their
business, company is trying to
deploy their position and availability
area worldwide.
Promotions IKEA can optimise numerous
techniques and tool for promoting
their services and products in more
significant manner (Joshi, 2012).
The organisation optimise
commercial advertisement, kiosks,
commercial advertisement,
billboards, magazines, email or
social media marketing etc. in order
to inform and aware consumer about
new plans and exotic offer of
enterprise.
As organisation has better market
value and exists in creating
information or knowledge in more
effective manner. This can be
consider that TV, hoardings,
billboards, print media, internet etc.
are the mean of media that can be
optimised in order to meet potential
buyer. The organisation also sponsor
and invest in world events like
Olympics etc. for promoting their
services and products at global
level.
People The store of company manage their
people through programming
Aldi perform good work or activities
for their people whether it is
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various activities and strategies of
market that can help in achieve
business objectives and roles. This
is the best method to allocate work.
Organisation also reward their
people of company for their best
performance and managing human
resources.
consumer or employee of
organisation. In order to provide
proper motivation, company
organise various session of training,
rewarding activities etc. Also they
have managed uniform system for
organised staff and proper hygiene
while working.
Process This is another fundamental in
which the IKEA's production of
commodities is being manufactured.
Selling procedure of IKEA is
majorly depend on the show room.
Consumer are given opportunities to
examine the entire products and also
provided free delivery of furniture
to consumer on their residual.
Company has also developed a
disciplined online process through
which consumer can directly seek
their products and make purchase
decision (Katengeza, Okello and
Jambo, 2011).
Marketing mix of ALDI refer to the
consumer procedure which help in
acquiring products as well as
quickly billing or payment
procedure ion their online as well as
online stores. The company has
adopted high technology in order to
achieve their business outcome
through satiate potential buyers. The
whole procedure support enterprise
in major decision making procedure
buying establishing coherent process
of production to distribution.
Physical evidence IKEA has more than 350 retail
stores chain in different nations in
order to aim the consumer
satisfaction. In this, company
optimise better position, good
interior and lighting in order to
portray and enhance their products.
ALDI has a global recognition
where they render different services
and products in effective manner.
This can be considered as one of
best company stores that has more
clean or attractive positioning in the
competitive market. Offer are placed
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The showrooms are more family
friendly and attractive for creating
more safe and better environment
even for children as well.
on such location which are directly
visible to buyers. Hence, stores of
company are simple and easily
accessible and operable.
Hence, IKEA can opt the marketing mix elements for creating more better and effective
strategies and products of organisation. This can also help in operating business objectives as
well as meeting the business objectives. Marketing mix is a complicated variables set that can
help business of company in various ways.
TASK 3
P4 Produce and evaluate basic marketing plan for an organisation
Executive Summary: This report will develop a marketing strategy of offered products of
IKEA which is home appliance and electronic products seller which has a good positioning in
international market. This marketing plans will investigate proper factors and trends of market in
product of organisation which can help in achieving business objectives. In order to develop it,
PESTLE and SWOT analysis in adequate manner.
Vision: Organisation's vision is to be one of largest home appliance and furniture selling
company delivering best services and reaching to consumer satisfaction effectively.
Mission: Company mission is to render more efficient services increasing consumer profitability
as well as get more than 20% ROI of company made in certain time period.
Analysis of Present Market: Organisation provide different products and services types in lower
cost. In order to create a new plan for marketing, this is require to understand various elements of
market including micro and macro environment analysis (Kennedy and Parsons, 2014). In order
to understand this, PESTLE and SWOT analysis would be undertaken in this report:
PESTEL ANALYSIS: Political Factors: Economical Factor: Social Factor: Technological Factor:
SWOT ANALYSIS:
Strengths Weakness
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 Organisation render high services and
product quality in competitive cost.
 Company cover large reach in market
of Sweden and also expanded its
business in other countries.
 Enterprise deals their services in
reasonable cost.
 Major drawback of company is its
recognition is not huge and unique.
 There are only limited stocks avauilable
in organisation.
 It has poor market image which need to
be impoved.
Opportunities Threats
 As digitization is new method of
marketing, company can expand their
business through using effective social
media promotion.
 Expansion of business is another
opportunity of growth after the
globalisation.
 There is high competition in market
which is giving high competition.
 Environment of company is not
favourable for company i.e. affecting
business at international level.
Strategy: Proper pricing strategy and sales increment can be met through building a new
strategy of business by IKEA.
Market Penetration: Through offering different offers, exotics plans, company can
enlarge their number of consumer base as well as can retain their existing service users.
Market Development: This is require to develop new service or product for accessing
new consumer.
Segmentation, Positioning and Targetting:
Segmentation: The client base is organised on the grounds of several elements. The
organisation has distinct their clients or consumer in Psychographic, demographic and
geographic segment. As per geographic elements, company has been aiming to the United Kingdom people as
per the product design. Psychographic: On this grounds, organisation is aiming middle and upper middle class of
people to access high number of buyers (Lamb, Hair and McDaniel, 2011).
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 Demographical: On the basis of age, gender, religion and culture, consumer has been
segmented.
Targetting: This refer to the individual group whom the firm is focusing over for
achieving their business mission and objectives. IKEA is focusing over families and women for
selling their commodities majorly.
Positioning: The term can be defined as the perspective of buyers or potential consumer
whom company is aiming for trading their services and products (Pike, 2015). In order to create
a good positioning, company need to accompany effective marketing and promotional tool.
Budget: In order to control the expenses and design activities and business operation
effectively, organisation plan or design a layout or blue-script which is referred as budget. IKEA
has set to spend more than 20% of outcome over market research and new product development
that can help in achieving their business objectives. This has determined £25,0000 over
expansion and management of resources.
Tactics: This is required to adopt essential tools and tactics for achieving business
objectives and marketing plan in effective manner. The company can op[t IMC tactics and tools
for branding, designing and execution of finance.
Control: In order to control, different activities is planned, execution of organised
strategy is done as well as proper goals determination is needed. Tracking each and every
operated activities is needed for IKEA in order to shape their outcome.
Result: It can state from this analysis that major objectives of business that can direct
company's outcome in certain path (Papasolomou and Melanthiou, 2012). This can assist
enterprise toward proper delivery of products as well as transportation in best ways. Organisation
is able to evolve as well as alter their service in order to create more quicker services. This can
help in satisfying consumer needs as well as demands along with aiding in producing quality
products.
Hence, it can state that association like IKEA can develop their products, create a unique
recognition and brand image and make more revenues through the assistance of effective
marketing plan.
CONCLUSION
This can be summarised from the above report that marketing is paramount for
organisation who are aiming to expansion of business and more revenues. Marketing plays a
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vital role in the business organization as well as aid in achieving function of business in more
significant manner. Marketing mix elements can help in expansion of business and
understanding the major organisational operations. This report also conclude that in order to
create marketing plan, this is essential to undertake some major procedure such as analyse
business environment, commercialisation of service etc. that can aid in launching a new or
existing product or technique in most effective manner. Marketing concept is fundamental for
development of an enterprise in competitive industry so as IKEA. In competitive environment of
business, aiming over consumer needs which can render proper edge to company.
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REFERENCES
Books and Journals
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practice. Sage.
Desai, S. S., 2013. An analysis of the competitive marketing strategies of the hospitality industry
in UAE. IUP Journal of Management Research. 12(1). p.22.
Fazlollahtabar, H., Aghasi, E. and Forte, P., 2012. Bi-objective two-stage decision-making
process for service marketing. International Journal of Strategic Decision Sciences
(IJSDS). 3(3). pp.24-39.
Gertner, D., 2011. A (tentative) meta-analysis of the ‘place marketing’and ‘place
branding’literature. Journal of Brand Management. 19(2). pp.112-131.
Hamilton, C., 2011. Cengage Advantage Books: Essentials of Public Speaking. Cengage
Learning.
Joshi, M., 2012. Essentials of marketing. Bookboon.
Katengeza, S. P., Okello, J. J. and Jambo, N., 2011. Use of mobile phone technology in
agricultural marketing: The case of smallholder farmers in Malawi. International
Journal of ICT Research and Development in Africa (IJICTRDA). 2(2). pp.14-25.
Kennedy, A.M. and Parsons, A., 2014. Social engineering and social marketing: why is one
“good” and the other “bad”?. Journal of Social Marketing. 4(3). pp.198-209.
Lamb, C. W., Hair, J. F. and McDaniel, C., 2011. Essentials of marketing. Cengage Learning.
Papasolomou, I. and Melanthiou, Y., 2012. Social media: Marketing public relations’ new best
friend. Journal of Promotion Management. 18(3). pp.319-328.
Pike, S., 2015. Destination Marketing: Essentials. Routledge.
Wirtz, J., 2012. Essentials of services marketing. FT Press.
Online
How to use the 7Ps Marketing Mix?. 2017. [Online]. Available through:
<http://www.smartinsights.com/marketing-planning/marketing-models/how-to-use-the-
7ps-marketing-mix/>.
Which are the 7P's of Marketing?. 2016. [Online]. Available through:
<http://www.marketing91.com/4-types-market-segmentation-segment/>.
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