Graduate Diploma: Marketing Communications Brief of IKEA, New Zealand

This report presents a comprehensive marketing communications brief for IKEA in New Zealand, analyzing its background, organizational structure, vision, and core values. It identifies key competitors, Danske Mobler and Freedom Furniture, evaluating their strengths and weaknesses. A detailed SWOT analysis is conducted to assess IKEA's internal strengths and weaknesses, as well as external opportunities and threats. The report examines IKEA's current marketing strategies, including segmentation, targeting, and positioning, along with an assessment of the marketing mix (4Ps): product, pricing, place, and promotion. Furthermore, it explores digital marketing communication strategies, covering context, content, conduct, conversation, cadence, and crisis management. The report concludes with a summary of key findings and recommendations for IKEA's marketing efforts in the New Zealand market.

MARKETING
COMMUNICATIONS BRIEF OF
IKEA, NEWZEALAND
Running Head: MARKETING COMMUNICATIONS BRIEF OF IKEA, NEWZEALAND 0

MARKETING COMMUNICATIONS BRIEF OF IKEA, NEW ZEALAND 1
Table of Contents
TASK 1: Background analysis...................................................................................................3
History of IKEA.....................................................................................................................3
Organizational structure.........................................................................................................3
Vision & mission statement....................................................................................................3
Core values and beliefs...........................................................................................................3
IKEA product portfolio..........................................................................................................4
Task 2: Analysis of potential competitors..................................................................................4
Strength of the Danske Mobler...............................................................................................4
The weakness of the Danske Mobler......................................................................................5
Strengths of freedom furniture...............................................................................................5
The weakness of freedom furniture........................................................................................6
Task 3: SWOT analysis..............................................................................................................6
Strengths.................................................................................................................................6
Weakness................................................................................................................................7
Opportunities..........................................................................................................................7
Threat......................................................................................................................................7
Task 4: Current marketing strategies.........................................................................................8
Segmentation strategy............................................................................................................8
Target market..........................................................................................................................8
Positioning strategy................................................................................................................9
Task 5: Marketing strategies (4 Ps)............................................................................................9
Product....................................................................................................................................9
Pricing.....................................................................................................................................9
Place.....................................................................................................................................10
Promotion.............................................................................................................................10
Task 6: Digital marketing communication strategies...............................................................10

MARKETING COMMUNICATIONS BRIEF OF IKEA, NEW ZEALAND 2
Context.................................................................................................................................10
Content.................................................................................................................................10
Conduct.................................................................................................................................11
Conversation.........................................................................................................................11
Cadence................................................................................................................................11
Crisis.....................................................................................................................................11
Task 7.......................................................................................................................................11
References................................................................................................................................13

MARKETING COMMUNICATIONS BRIEF OF IKEA, NEW ZEALAND 3
TASK 1: Background analysis
History of IKEA
This organization was originated in Sweden in 1943. This organization was
established by Ingvar Kamprad. IKEA started to trade in furniture after five years. IKEA first
outlet was opened in 1958 in Almhult, Smaland and the name of the store was Mobel-IKEA.
It has gotten high-level success as the organization's West German executives released a store
in 1973 in Konstanz. Organization also opened many stores in other portions of the world like
Japan, Australia, Canada, and Hong Kong, Singapore and so on. The organization later
expanded in many nations in 1990 and 2000. The biggest market of IKEA is Germany as it
holds 53 stores. IKEA operates more than 424 stores in 52 different nations (IKEA, 2011).
Organizational structure
IKEA is operated and owned by an intricate range of for-profit and not for profit
organizations. Structure of the organization is divided in two portions operations and
franchising. Intersystem of IKEA is owned by IKEA inter holding, an organization registered
in Luxembourg. IKEA inter holding, in turn, is preserved by Interogo foundation based in
Liechtenstein. The INGKA holding in 2016 sold its manufacturing, design, and logistic
subsidiaries to inter holding of IKEA. Ingvar Kamprad, in June 2013 resigned from inter
holding of IKEA board. Mathias Kamprad his youngest son interchanged perludvigsson as a
chairman (Dudovskiy, 2017).
Vision & mission statement
Vision and mission statement of IKEA both are link by the overall objectives of the
organization. The vision of an organization is an inspirational view that supports the business
to create a focus directed towards the future by inspiring stakeholders, customers, and
motivates employees to gain objectives. IKEA wants to provide the surety that organization is
accessible for everyone by creating a better everyday life. For this organization reinvest a
large amount of profit in stores, sustainable solutions, and product development by regularly
lowering values. The mission statement of IKEA is to communicate all the objectives to
employees, customers, and stakeholders. It continues to work according to the mission by
increasing product quality at affordable prices (Jurevicius, 2013).
Core values and beliefs
IKEA believes each individual has valuables to deal and strive to hold similar values
in the method of work. Identity of IKEA is reflected by core values and beliefs as

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togetherness is in the heart of IKEA culture. It builds IKEA strong to trust each other in a
direction by forcing toward positive change and generate an important impact for the
generations. The organization regularly staying close to reality by finding a solution toward
impossible challenges as part of the success of an organization and source an inspiration to go
forward to move on a subsequent challenge (Siddle, 2018).
IKEA product portfolio
IKEA product portfolio is a collection of amenities or products offered by the
organization to decrease the negative impact on the environment by the perspective of sage
health for customers. The idea of the organization is to keep low cost by use of resources to
design product and strive to use recyclable and renewable materials in products. The
organization is working together with skilled manufacturers to design and find methods to
catch the most obtainable of raw material. The organization is working with flat packs and
capable enough to offer a product to a customer at a low price. The product range of IKEA
approaches at a different level. The organization is leading this industry at a good level
(Peterson, 2019).
Task 2: Analysis of potential competitors
For IKEA two competitors are Danske Mobler and freedom furniture (Frank, 2019).
Danske Mobler organization is known as a leading firm within the industry. It carefully looks
to make strategic decisions. The organization continuously analyse competitive positioning
within the business environment by reviewing strategies and make decisions. Freedom is one
of the major homewares and furniture retailer by more than 65 outlets in New Zealand. It
builds interacting procedure to undertake and cording among all departments like logistics,
operations, finance, management information system, and so on.
Strength of the Danske Mobler
 Distribution and reach
Danske Mobler organization has a large number of stores and support a strong
network of distribution by providing surety about the products that are available easily to
customer’s at large number timely. For example, an organization uses marketing channels
like direct marketing and direct mail to customers by a full product catalogue that drive the
internet, telephone, and retail purchase.
 Cost structure

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The organization has a low-cost structure that supports to yield low cost and trade in a
product at a low worth and make it reasonable for customers. For example, to increase profits
organization finds appropriate ways to identify excessive expenses that not provide additional
value to business activities. Analyst within the organization provides insights to increase the
profitability of a particular product by replacing the least profitable products and apply many
strategies to decrease costs.
The weakness of the Danske Mobler
 Research and development
Danske Mobler is spending a large amount of money on research and development
expenses within the industry and spending lesser money on the departments that had an
important benefit as an outcome of their inventive products. For example departments not
care about the development of the department as there is gape of training to develop skills
and competences.
 Low current ratio
The current ration of Danske Mobler presents the ability of the organization to come
across the short term financial obligation. It shows that an organization will have the problem
of liquidity in the future. For example, the organization experienced prices and distress that
varied much more than before.
Strengths of freedom furniture
 Financial position
Freedom furniture has a strong monetary position by consecutive profits in recent
years by reserves of accumulated products and used to finance upcoming capital
expenditures. For example, a balance sheet of an organization is listed in the order of
accounting equation and delivers creditors and investors an easy and clean view of
organization economic position, debts, and resources that used for purposes of financial
analysis.
 Automation
It has applied automation at many stages of production that allow effective use of
sources by decreasing costs with consistency in quality of product and ability to scale up and
down product according to the market demand. For example, an organization to support

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customers around the clock has developed software to contact the business by messaging than
email and it is easy to integrate by automated customer support desk and follow up to get the
surety about the teams to connect personally at right time in the journey.
The weakness of freedom furniture
 Workforce diversification
The workforce at freedom furniture concentrates on local workers rather than racial
backgrounds. Diversification lack makes it hard for employees to adjust to the workplace by
losing talent. For example, managers within the organization provide certain instruction to
complete specific tasks that fail to fill comprehend instructions that employee make errors to
complete a task without receiving clarity.
 Market research
Freedom furniture has not researched a market that serves for the past two years. The
organization is deciding based on two-year data. There is the requirement of evolving
research according to time. For example, the organization can test a program to determine the
need to make changes based on actual and real base.
Task 3: SWOT analysis
IKEA is known for its effective and simple approach to retails. Organization assured
to keep cost low and transfer values to customers as a product of organization are ready to
use and flat packed to easily assembled for customers themselves. For this IKEA holds an
efficient online presence as a key strategic driver to approach towards retailing with huge
dividend toward shareholder of the organization (Broad, 2011).
Strengths
 Reputation and presence of market
IKEA is the furthermost valued furniture retailer and has good value as a furniture
retailer brand with a value of 17.4 US billion in 2018. The IKEA system franchise holds more
than 423 stores in 52 nations and markets. It has a strong reputation for a brand and global
presence to ensure that consumers will select IKEA over competitors. It offers 12000 product
and produces 2.5 billion visitors of IKEA websites and more than 957 million visits in the
previous years. For example, IKEA can produce products by effective ways of lowering cost
and without impacting expectations of customers at different places as holds goodwill at an
effective level.

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 Strong financial position
IKEA has reported a profit of 38.8 billion. It can be attributed to concepts by
effectively that translated into an array of product assembled by the customers themselves
and led to a high reduction in cost. It has focused to maintain cost leadership that imposes a
positive impact on its revenue. For example, ready to assemble approach attracts customers to
make decisions through innovative strategies to target a large number of customers.
Weakness
 Negative media attention
The organization is operating in many different markets globally and has faced much
criticism over time with different issues. Organization employees complained about activities
of questionable promotion and poor treatment that can damage reputation and loyalty. For
example, an organization only focus to provide standardized quality service and products.
 Products at low quality
This is a difficult task to decrease the cost by maintaining the same quality of a
product. For example, the reduction of cost by maintaining the same quality product put a
negative influence on the goodwill of the brand as the raw material cost is increasing and this
is not possible to maintain the quality at low cost.
Opportunities
 Global expansion
Expansion of IKEA with the emerging markets in the developing nations is an
untapped base of customer that can be leveraged for effective profitability. For example, an
organization can make plans for expansion in a larger market like China and South America
by cost leadership strategy with hopes to yield benefits for the organization.
 Expansion in the grocery market
In today’s time, everyone likes healthier food that has increased demand for grocery
products in many nations. It is a great option for IKEA to upsurge the business of grocery and
introduced stores of grocery within exists demand. For example, an organization can
successfully be aligned by a growth strategy to manage food and restaurant outlets.
Threat
 Stiff competition

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It is operating in 52 nations and has stiff completion with international and local
brands. For example, in India, local competitors like Pepperfry is an online furniture retail
store that is providing a tough time to IKEA.
 Lawsuits
The organization underwent many litigation and lawsuits matters because of its recent
issues of discrimination of employee with poor quality of products that offered. For example,
IKEA was subjected to lawsuits from its customers that were injured by its products.
Task 4: Current marketing strategies
Segmentation strategy
The organization employs a market segmentation strategy that aims to attract specific
market segment (Jacquelyn, 2017). One of the important stations of division is to marketplace
the sustainability of the product. This present that product is made in a way to meet the
requirements and demands of a market that present kind for the environment with the future
generation. The organization adopts a green approach that appeals to a marketplace that is
apprehensive about the environment (Cronin, 2011). IKEA design products to reduce wasted
space in transportation and consumption. For example, the foldable lounger is an example to
save the idea that is easy to carry and use around according to the requirements. For example,
the electrical product of IKEA are vitality efficient as the consumption of electricity is lesser
than the general voltage product in the marketplace as save water consumption.
Target market
Based on marketing strategy target marketplace of organization is younger customers
that focus on space-saving and lifestyle. These customers just starting their lifestyle and may
move to a new apartment or place or young couple that decides to move in together. This
kind of customers holds the low budget and save money as focus on the future and
environment. The next type of customers are students that look toward a product that can
deliver convenience to current lifestyle. The traits of the target marketplace are lower-income
as they are not in employees and holds a simple approach with usability. They require to
solve daily requirement without many hassles (Aghdaie & Alimardani, 2015). The third
target market of IKEA is older customers. The requirement of this kind of customers is light,
not bulky and older customers incline to be downsizing. It shows that they are marketing their
previous house and moving to apartment-style for security and comfort. This customer seeks

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a simple product that delivers comfort. For example, these tend to green approach towards
lifestyle as like to environment-friendly approach towards the future generation.
Positioning strategy
Based on the target market IKEA position the product to meet the requirements.
IKEA designed the product according to the requirement of markets. It is observed by
minimalist and simple method from the products of IKEA. The organization does not target
to deliver the highest eminence product that is built by solid materials by the ability to
preceding a long time (Pankhania & Modi, 2019). The organization aims to deliver simple
products tested by durability. It is detected within the store of IKEA to educate customers that
produce relatively low-priced but this one does not despicable that produces are not durable.
The organization uses many different kinds of technology about the store that use advance
programs to tackle customers by determining a suitable product.
Task 5: Marketing strategies (4 Ps)
The organization consists that segments of the New Zealand market contains of highly
accomplished adults with a high level of income and IT savvy young adults (Akram, 2012).
This segment will be more profitable and increase profits with presentable new market
segments.
Product
Furniture of IKEA is deliberate to be “Do It Yourself” in place of pre-assembled by
customers. This will support the customer to get the manufactured goods at low cost by use
of packaging. This will be a practice as public transport is utilized in everyday life. For
example, the channel of the flat-pack will be easy for the customers with easy public
transportation from store to home. This is a multinational organization situated in many
nations by different languages. Founder of IKEA referred that remembering names in place
of product code is difficult and lengthy to remind. For example, it has presented a new
product known as an LYCKHEM, it bears the sense of bliss. The organization has shown
concern about the needs of a single and try to fill the demand of all consumers. For example,
a product that encounters the criteria of a market like kitchenware and beds that is convertible
in different functions.
Pricing
There are many strategies concern about the pricing and long-term objective of IKEA
is analysis has been led by the IKEA according to the position of an organization. The

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organization has analyzed position within the market by determining that the furniture huge is
properly financed. For example, to achieve profits with the investment pricing kept at a
reasonable rate to shut out rivals.
Place
This is renowned for the approach of competitiveness with innovative creation results.
This produced a partial amount of product and relies on a supplier’s network. Products of
IKEA with the suppliers can generate an atmosphere with unique design including
environmental accountability materials and efficient usage of resources. For example, most
preferable customer orders are online. Online shopping and everyday orders by telephone are
continue uprising that requires effectiveness and flexibility distribution solution for each
customer’s expectation.
Promotion
In an advertisement from the different nation as creating display slogans associated to
products and IKEA. For each national organization has different advertisement and slogan
that adapted by the nation itself. The organization has presented a high profile campaign
advertisement that includes online advertisement. For example, IKEA provides furniture in
dance, dinner, wedding function, and function show. These present the retention regarding
customers uprising for this organization regularly conduct surveys to get customers to
feedback to improve customer’s retention. For example, performance feedback is the best
judiciary utility of an individual’s product and amenities offered by the organization. A
suggestion of customer helps to adjust according to product and services.
Task 6: Digital marketing communication strategies
Social media sites like Facebook and Twitter are significant vehicles for carrying
content (Wymer, 2011). For IKEA these consists of words, pictures, text, and videos. These
are created by the customer’s potential around the globe from a customer’s perspective and
need the inspiration to generate further values for these customers.
Context
This strategy of IKEA is started by the organization with the generation of contents. It
remains as a pull medium for IKEA by seeking the pull and pushes content that is important
for the push forward in the chain. For example, a product of IKEA with a brand page pushed
out to observers. This pushed to the social media domain by A IKEA acts as a substance for a
model of engagement and participation.

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Content
This is an intent that represents a wall beyond that the organization passed by control
of the brand to the customers and online community (Smith, 2011). IKEA accelerate the
brand messaging that gives right to encourage the online community by modification. For
example, Brand management gives the right to the manager by keeping control of the
messaging and brand image.
Conduct
It is an everyday part of most of our lives. IKEA refers to many sources that build
image like online survey, public circumstances, etc. For example, the organization engages
with the audience by sending messages about the medium to choose and alert customers by
an online presence.
Conversation
The conversation is considered as conveying information that markets considered
(Lee & Carter, 2011). Increase level of interaction will lead to building relations with
audiences (Smith, 2011). Conversation between marketers and customers by a feedback loop
increase community with the online community in hopes of manipulating buy decisions. For
example, the internet has changed the concept of word of mouth and describe practices to
outgoing mail from users.
Cadence
This helps IKEA to understand the constant flow of actual-time data and deliver the
right data to the right audience. For example, IKEA can respond to split-second shift of
attention and interest.
Crisis
Social media can both solve and generate a crisis and incredible fickle nature of social
conversations requires IKEA to be on a constant state of readiness. It includes the responding
at the flashpoint by prepare to make and launch content in a variety of circumstances and
formats. For example, Traditional crisis management requires procedures for written releases
and press conferences on social media.
Task 7
Following are the recommended three important negotiation method that should be
applied to meeting with the Swedish owners.