Marketing Report: An Evaluation of IKEA's Marketing Strategies

This report provides a comprehensive analysis of IKEA's marketing strategies. It begins by defining marketing and its relevance to IKEA, a global furniture retailer. The report then delves into the key roles and responsibilities within IKEA's marketing department, emphasizing brand management, customer relationship building, and market analysis. The study further explores how IKEA applies the elements of the marketing mix (product, price, place, and promotion) to its advantage. Finally, the report develops and evaluates a basic marketing plan for IKEA, considering the company's objectives and target market. The report's structure includes an introduction, an analysis of key roles and responsibilities, an examination of the marketing mix, the creation of a basic marketing plan, and a conclusion, supported by relevant references. The report aims to provide a clear understanding of IKEA's marketing practices and their impact on the company's success.

Marketing management
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Table of Contents
Introduction.................................................................................................................................................2
Task 1..........................................................................................................................................................2
Key roles and responsibilities..................................................................................................................2
Explanation of key roles and responsibilities...........................................................................................3
Task 2..........................................................................................................................................................4
Marketing mix.........................................................................................................................................6
Task 3..........................................................................................................................................................8
Marketing plan........................................................................................................................................8
Conclusion.................................................................................................................................................11
References.................................................................................................................................................12
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Introduction
Marketing is defined as the activities used by the organization to sell their products and services
to their potential customers. This include processes like an advertisement, promotion, market
research, development of new products and services etc. To understand the concept of marketing,
IKEA has been selected. IKEA is a Swedish multinational retail company, which produces and
sells furniture, kitchen appliances and home accessories (IKEA, 2018). The company has
established numerous branches around the world since its foundation in 1943. The aim of the
paper is to focus on the roles and responsibilities of marketing and how it relates to wider
organizational context. Furthermore, it compares the different ways the organization applies the
elements of their marketing mix. Moreover, this report also develops and evaluates a basic
marketing plan for IKEA.
Task 1
Key roles and responsibilities
Marketing is defined as management strategy which includes processes like market research,
customer service, product development, promotion and advertisement (Abdul-Hamid, Hinson,
Mahmoud and Yaw, 2017). IKEA is a retail organization, which designs and sells furniture and
home accessories. The first role of marketing is to promote and manage the brand image of the
company. Employees of the organization are responsible to maintain the brand image of the
company by providing excellent quality customer services (Belz, 2017). They use social media
to create and manage strong relationships with their customers, as well as promoting the brand
name. Marketing managers of the firm are also dedicated to developing strategies in order to
connect directly with their customers. They also develop marketing campaigns to create value for
their customers and increase the sales, profits and customer loyalty of the organization
(Srivastava and NATU, 2014).
For example, they have numerous branches across the country, which helps them to maximize
their profit. The marketing managers also have the responsibility to understand the needs of their
consumers and develop a value-driven marketing strategy. The marketing strategy is generally
employed by the senior managers with the help of junior managers. The junior managers of the
company are responsible for involving directly with the customers of IKEA. They have the
responsibility to expand the market of the organization, with the help of market penetration and
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new product distribution strategies (Uppal, 2015). With the help of marketing, the company
establishes itself as a prominent name in the minds of their consumers. The organization has to
create and promote their brand among the consumers in order to sustain in the competitive
market of the organization. This is why IKEA has a developed an innovative promotion strategy
to promote the brand through social media and television.
Explanation of key roles and responsibilities
The roles and responsibilities of the employees play a crucial role in the development of the
brand name of the organization. The workers of IKEA has contributed in a significant manner to
expand the business of the company on an international level. The consumer perspective about
their products and services must be considered by the organization. It helps them to sustain in
the competitive market and increase their profitability. The marketing managers have the
responsibility to gather information about the preferences of the consumer from the market. They
have to communicate this data with the other departments of the company (Wirtz, Tuzovic and
Kuppelwieser, 2014). The customers want to have better quality products and services from the
company. They also want to have products which meet their expectations, and they expect to
have best quality customer services from IKEA. For example, marketing managers of the
organization communicate the information collected from market research, production
department can produce the desired products to their customers (Moorman and Day, 2016).
These managers play a key role in understanding the marketplace and the customer need of the
organization. The customers of the organization will provide positive feedback to the company if
they are satisfied with the products (Baker, 2014). Thus the role and responsibilities of the
employees allow IKEA to receive positive feedback from the consumers.
The success of the business of the organization depends on the quality of their services and
products. It is the responsibility of the marketing managers of the organization to measure
customer engagement with their products and services. According to the engagement of these
customers, the firm can improve the quality of their products and services. For example, the
managers of IKEA have to understand the demand for their products in the market (Feng,
Morgan and Rego, 2015). The marketing managers have to communicate this information to the
respective departments of the organization. Thus the role of these managers allows the
organization to create value for the consumers, thus allowing them to capture the value from
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them. With the help of the information of the collected, the firm can increase their sales,
profitability and customer loyalty. These managers along with other employees are responsible
for delivering value and delight to the customers. The marketing managers have to understand
the demand of the products of the enterprise in order to sustain in the competitive market.
Promotion of the brand name of the company is another responsibility of the marketing
managers. The organization has monitored their social media activity to provide better quality
services to their customers (Turban et al., 2018). For example, the queries of these buyers are
answered promptly by the employees of the firm. This allows the firm to make the marketing
experience personal and increase the level of profitability of the organization. These managers
along with other employees of the enterprise perform together to increase the level of customer
satisfaction and their loyalty.
The roles and responsibilities of these marketing managers allow the organization to increase the
delight of their customers. They also have the responsibility to create and maintain strong
relationships with their buyers. The customer representatives of the organization along with these
managers play a significant role in creating value for their customers so that they can increase the
overall sales, profitability, and sales of the products of the organization (Sharma, 2017). It also
allows the firm to receive positive feedback from the customers, Customer satisfaction plays a
significant role in increasing the brand name of IKEA. The main responsibility of the marketing
department is to promote the brand name among the consumers. It also allows them to sustain in
the competitive market, by increasing their overall profitability and productivity. Hence, it can
be said that the roles and responsibilities of these managers are related to the overall productivity
of the firm.
Task 2
The consumer marketing manager of IKEA needs to have suitable and effective working
function that help them to develop suitable and effective marketing concept within the market.
Being the new assistant for the marketing manager the task is very critical to provide effective
data for the firm (Zentes, Morschett, and Schramm-Klein, 2017). Creating effective marketing
strategies for the organization is essential to maintain their activity and their working function
within the market. IKEA is the furniture company that provides suitable and effective kitchen
and home appliances which are ready to assemble. The organization can effectively improve
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their working function and their quality with the help of appropriate customer value along with
the management of consumer relationship. IKEA has developed effective marketing
communication strategies like providing effective marketing process within the firm. The
organization also maintain their mission along with the vision to establish their strategy within
the market. Fulfilling the need of the customers provides effective marketing strategy for IKEA
to perform their business (Kellaris and Machleit, 2016). The organization provides an effective
working function for the firm.
It can be seen that the effective working function within the market is with the help of the
vertical integration in the international market. For example; IKEA provides the most essential
products to the market that is ready to assemble and use. This helps them to draw the attention of
the customers and also provide the appropriate furniture to the market (Kitchen, P.J., and
Burgmann, 2015). The primary concept of the firm is to provide modern design furniture to their
customers that is essential for the firm within the market. The fact is clear that this company is
one of the best furniture manufacturing company that offers numerous product range for the
customers all over the world. The firm is having the variable working function that allows
developing the working function within the market. In the international level, it is essential for
the company to maintain their position within the market by providing a valuable price for the
products (Batra and Keller, 2016). IKEA needs to develop their operation as well as their
marketing manager for maintaining various activity within the field.
It became essential for the firm to provide valuable marketing campaign that is essential for
attracting the customers all over the world. This is one of the most effective working function
that is being provided by the firm within the market. It can be seen that working function of the
organization is quite effective to maintain a strong and valuable relationship with the customers
and that also with the help of marketing (Batra and Keller, 2016). The organization provides
various range of products and price to attract their customers and also in the same way they
provide numerous distribution centers for their product. People here have the ability to grab their
product and this distribution centers also work as the shopping mall or the stores of IKEA
products. It is essential for the firm to understand the need for their consumers which allow them
to develop effective marketing strategies within the market. IKEA has the valuable working
function for their consumers in the global market.
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Marketing mix
Product
IKEA is one of the leading furniture retail chains that spread their brand all over the world.
IKEA company products cover the wide range of the nation. The firm offers baby and children's
products, dining product, bathroom furniture, beds, outdoor furniture, cooking products, desks,
mattresses, chairs, decoration and many other products (Khan, 2014). All this product are used
for home purposes which helps the company growth in local as well as in international market.
Along with this the firm also offers kitchen appliances that include kitchen cabinets, small
storage box and many safety products, lightning products etc. As being a furniture company
sofas and armchairs and all sorts of furniture along with tools and tables, textiles and hardware
are also provided by them. Actually, the firm provides all types of furniture product of good
quality that attracts the customer to purchase the products. The product is used for various
purposes and these products are present in all IKEA stores in the market. In this case the
organization IKEA provides the best product as compared to other furniture industry within the
market.
Price
As a furniture company, they compete with a various local retail firm as well as many
international companies too. Forgiving a tough completion to the local as well as in the
international market the firm business strategy to sell their products at a low cost starting from
15.99 dollars. The pricing strategy that is used by the firm help them to attract consumers which
is effective for increasing the business in the international market (Abidemi, Halim and
Alshuaibi, 2017). The furniture made for household purposes and offices by the company is of
the low price that attracts the consumer to purchase this product. The firm mainly focuses on the
price control and thus makes good quality of the product. From 2010 the IKEA marketing
strategy is to lower the prices of the product and it gives the huge benefit to the company after
that strategy. Along with this IKEA also offers free services in their restaurant and this grabs the
consumer attraction towards their product. As compared with other organization the price range
of IKEA is quite low for the customers to get ready to assemble furniture.
Promotion
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IKEA mainly focuses on its marketing activities for promoting the brand in the market. For
promoting their brand in the market they give advertisement on television, print leaflets and
along with this, they give online ads on social media, billboards and various other platforms
(Hanlon, 2014). The firm launched an advertising campaign in the UK for promoting their brand
and named it as "Home is the most important place" and uses signs of "Not for Sale". This
campaigning strategy helps the firm to increase their consumer number in the market. Another
advertising campaign was done by the firm on the basis among who is better between women
and men in-home services. The campaign was started in front of live audience and two men and
two women stand-up comedians were debating on which gender is better. This idea of promotion
is used to determine that both genders are better in terms of home services and this campaign
increases the consumer attraction towards the brand.
Place
The distribution strategy of the firm is quite innovative and thus it has a wide distribution pattern
in the international market. The company has the high level of manufacturing demands that
increase the distribution of this brand throughout the market locally as well as internationally
(Hanlon, 2014). The firm has more than 25 centers of distribution and they can operate their
business in about 50 countries in the world. IKEA sold more than 9,500 products in the market.
The marketing strategy of the company is to transport the product by ocean ways than through
road as oceans ways take lower costs than roadways. This strategy helps to increase the brand
profit in the market and thus they can sell their product at a low cost. The products are directly
shifted from the suppliers to the stores and this reduces the transport and handling costs as well
as the carbon footprint also decreases. As compared to the various furniture business the
organization effectively distribute to various places and also they have huge number of
customers’ centers.
People
The firm gives special attention to their customer and thus produces a lower cost of the product
and gives high-quality services to them. They also give importance to the employees working in
this firm that influences help them to do better work in the coming days. The employees of the
firm believed that they are the honest people having the passion for home furnishing. This makes
them enthusiasts, fun, and togetherness in their work (Lehner, 2015). The firm main motive is to
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satisfy the consumer needs and thus they make the product as per the customer choice. From
2015 about 116,000 employees work in retail, 21000 in production method and 18000 for supply
purposes. The company sells their product irrespective of cast, culture, and religion and this
increases the business growth in the market. With the comparison of other company it can be
seen that IKEA is also having suitable and effective strength of employees.
Process
The company has various business process throughout the world and thus it has 44 production
units in more than 10 countries. The company has its own wood mill which helps them to make
high-quality products. The production units possess many high developed technologies that help
IKEA to produce an innovative design of the product (Kotler, 2015). The company has the
exclusive supply chain and innovative management methods and also with this they follow the
environment clean slogan. On the basis of design, the price is distributed for each product. IKEA
purchase products from almost 1800 suppliers and the product are delivered in pieces that have
to assemble by the consumers and this strategy will save transportation cost.
Physical evidence
The company has more than 350 stores in 50 countries. The physical evidence of IKEA provides
a huge store layout that gives the customer more than a shopping experience. After entering the
store a guide will help the customer to reach the desired item they want to buy. Stores are
attached to the restaurant where free services provided for refreshments and also a department
has present where mothers are allowed for handling their babies (Kotler, 2015). Outside the
store, a large parking area has been provided and along with the stored also provided an area
where the damaged product is sold at a huge discount. The largest store of this company is
located in Montreal and Sydney.
Task 3
Marketing plan
IKEA is ready to assemble furniture all over the world and this organization provides the most
modern design furniture. The vision of the firm is to create better lives for the people. Their
mission is to develop the vision of the firm and provide valuable service to the customers
regarding effective products.
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SWOT analysis
Strengths
 They are having a strong brand image
 Huge global market
 Effective adaptability for the
international market
 Suitable international marketing
strategy
Weaknesses
 They have a huge focus on Western
Europe
 They have to face the downside of the
distinctiveness
Opportunities
 Emerging market within the various
part of a global field
 They have a suitable process of
internet retailing
Threats
 High level of competition from the
various supermarkets
 The critical economic condition of the
various country
Target market
The target market of the firm is being selected for the home furniture, then the office furniture
then the kitchen appliances and so on. The organization provides all kind of furniture that is
ready to assemble for the customers (Khan, 2014). Their primary target for the products are the
families with suitable income to get their products. Various kind of furniture and modern design
are provided that allow the firm to attract their customers at the international level. They also
target the young shoppers who required a style that also at the low cost. It is recommended that
the organization need to develop their strategy and their business function in the most effective
and the suitable target market for the firm. The effective strategy that is utilized by the
organization for their business purpose provides valuable data to invest their market and their
dealing business.
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Market positioning
The organization is having the most effective and the suitable strategic position within the
market. The position of the firm is suitable in the market to establish their working function and
their effective position in the field (Lehner, 2015).
Marketing Mix
Product: the organization provides various range of modern and stylish products to their
customers.
Place: they have numerous distribution center in various place around the world to attract the
numerous range of consumers.
Price: The organization is known for their effective products with low cost in the market. The
starting price of the product is 15 dollar only.
Promotion: The organization uses various promotional strategy to maintain a strong relationship
with their customers in the market.
Budget
Materials Price ($)
Marketing/promotion 1000
Marketing agency 2000
Television
advertising
500/month
Online advertising 600/month
Social media 0
campaign 10,000
Restaurant promotion 500/month
Print advertising 600
Radio advertising 400/month
Total expense 15600
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Conclusion
It is evaluated from the report that the organization is providing the most suitable marketing
function to attract their customers. It can be also concluded that the organization has a suitable
restaurant where they provide free food also. It is one of the best ways for the firm to maintain
their activity in the international market. The organization is also providing various kind of
products within the market which are all ready to assemble products. The marketing strategy of
the firm is quite essential to maintain a positive relationship with the customers all over the
world.
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