Marketing Essentials Report: IKEA's Marketing Plan Analysis

This report provides a comprehensive analysis of marketing essentials, focusing on the marketing strategies of IKEA and Walmart. The introduction defines marketing and highlights IKEA's business operations. Task 1 evaluates the roles and responsibilities of different marketing functions within IKEA, including the marketing information system, product management, market research, financing, promotion, pricing, and selling, as well as current and future trends. It also explores how these roles are interrelated with other organizational departments like finance, consumer services, IT, sales, and HR. Task 2 compares the marketing mix of IKEA and Walmart, examining their product offerings, pricing strategies, and distribution channels. Task 3 outlines IKEA's marketing plan, providing a detailed framework for achieving its predetermined goals. The report concludes by summarizing the key findings and insights gained from the analysis of these marketing strategies.

Marketing Essential

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Evaluating the roles and responsibilities of different marketing functions..........................1
P2 The way roles and responsibilities are interrelated with marketing in organisation context 3
TASK 2............................................................................................................................................5
P3 Compare the marketing mix of two different organisation:-.................................................5
TASK 3............................................................................................................................................8
P4 Marketing plan of IKEA:-......................................................................................................8
CONCLUSION..............................................................................................................................11
REFERENCES................................................................................................................................1

INTRODUCTION
Marketing refers to the set of activities that includes promotion, distributions, selling and
delivering of goods and services on right time and at a right place. Using these activities
company tries to identify the needs and want of the customer and using that they create and
deliver good and services accordingly to aid value to their services to fulfilling the demand of
end users (Baines, Fill and Page, 2013). IKEA is an multinational industry that manufacture
and sell furniture includes home accessories and kitchen appliances. It is Sweden based
company and controlled by different foundations of Netherlands and Liechtenstein. Its website
contain about 12000 products.
This report includes description of role and responsibilities of marketing manger of
IKEA in relation with other department along with marketing mix elements that helps in
achieving organisational objectives. In addition to this project outlines marketing plans of IKEA
that provides an guideline to Marketing Manager to achieve its predetermined goal.
TASK 1
P1 Evaluating the roles and responsibilities of different marketing functions
It is a concept of interacting business functions design to price, plan, promote and
distribute to satisfy needs and wants of present and potential customer (Baker and Magnini,
2016.). Marketing is the innovative management function which directs and organises average of
business activities. The main objective of marketing identifying consumer needs and convert
them into idea than develop product and services and move to end user. There are various roles
that IKEA is performing towards different marketing activities which are as follows :
 Marketing Information system:
From internal and external sources, there is systematic collection, analysis, interpretation,
storage and dissemination of market information on the continuous basis. MIS is software
program which provide information about marketing research. This is very effective tool that
help manager to make better decisions related to marketing operations like pricing, packing, new
product development, distribution, media, promotion, etc. Product or Service Management:
It refers to the process of designing, creating, maintaining a product or service through all
stages of its life cycle. Product or service management includes a large range of operations,
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marketing and sales related functions (Brassington and Pettitt, 2013). This also helps in sequence
stages of new product development process. Market Research:
Market research is action of collecting information about consumers needs and
preferences. IKEA done market research by conducting surveys, product testing and focus
groups. It provides suitable data to solve marketing challenges that are faced by organisation. Financing:
It is the process of providing funds for business actions, investment or for purchase.
This deals with how organisation is managing their funding or working capital
through external sources like investors and shareholders (Cooper, 2012). The important
function of finance is analysing, interpreting, evaluating and summarising books of accounts
and audit them. It also used for preparation of budgets for a particular event and for
promotional activities conducted in an enterprise. Promotion:
Promotion refers to different set of activities that tells about product, brand or services to
the end users. Advertisement is the important responsibility of marketing. This helps in make
people aware, attract and induce customer to buy that particular product or service. There are
various type of promotions such as advertisement, press release, consumer promotions (schemes,
discounts). Pricing:
Pricing is essential responsibility of marketing to set best price of a commodity. It means
decide the amount of product according to value of it which is easily payable by consumer
(Desai, 2013). There are various pricing strategy which is applied by IKEA such as penetration
pricing, skimming strategy and economy pricing. Price of product and services is decided
according to buying power of consumers, competitors price. Price should be set accordingly so
that it is beneficial for both company and consumer as company wants to earn more and more
profit and customer do not want to pay high. Selling:
Selling refers any transaction in which money is exchanged for goods and services. It is
directly interlinked with marketing functions because company have to identifying the needs and
wants of consumer and than they become liable to deliver right product at right time (Dibb and
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Simkin, 2013). There should be proper distribution channel of product so that with minimum
cost and time commodity reached to ultimate user. Salespersons of IKEA sells their product
according to customers needs and wants.
 Current and Future Trends:
It is very essential for IKEA to analysis and evaluate the current and future trends so that
it satisfies need & wants of customers, this leads to long term survival in market. Online
performance is a trend which is used to increase brand awareness and effectiveness, by this
many people get attracted to their products. Another trend which is used by company is mobile
marketing as everybody use mobile so more number of people get aware about product and
services and it leads to increase in sales. Marketing process:
Market process is a process of evaluating and analysing the opportunities in the market,
development of marketing mix, selection of target markets and management of marketing efforts
(Griffitts, 2016). There is a sequence of steps such as firstly situation is analysed to identify
opportunities than strategy is formulated for value proposition after that tactical decisions are to
be taken and lastly implementation plan and monitors the results. Steps involved in marketing
plan are as follows:
 Step 1- Situation analysis
 Step 2- Marketing Strategy
 Step 3 – Marketing Mix Decisions
 Step 4 – Implementation and Control
P2 The way roles and responsibilities are interrelated with marketing in organisation context
Business associations are using the marketing to achieve their desire targets. It can be
done through identifying the needs and demands of the consumers related to the new product or
services. Marketing help in doing, any business activity very efficiently and effectively. Apart
from it, finance, human resources, information technology, sales, research and development,
consumer service department are also help in generating the profit and revenue to the business.
 Marketing and finance department:
The main objective of the finance department is to identifying, analysis, evaluating ,
summarising and interpretation the books of accounts and than audit the same. Maintaining the
budget of the business. Like finance department allot a fund to every department so before doing
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any business activity, manager have to take a permission from finance manager (Jones and
Rowley, 2011). So there should be a good relationship with each other so company can achieve
their target easily. IKEA marketing manager communicate their promotional and other
advertising activities to the finance department so they can frame the budget according to them
and plan communicate by the finance manager of IKEA to the marketing manager very
effectively and clearly so they can understand.
 Marketing related with consumer services:
In which marketing department provides services to the consumers through
education( they provide awareness regarding the available and upcoming product in the
marketing through different promotional techniques like advertisement in news paper, T.V,
radio, internet, hoardings etc. ),direct marketing. IKEA provides a customer support centre in
which consumer can ask any query, grievances and problem related to product or services and
made a Kingston park. Without marketing, company can't intimate about their services which is
made for customer. So that's why it is interrelated with each other. Marketing related with information technology department:
Through higher technology, organisation can achieve there task very fastly and through
technology innovation in the products and than for promoting that innovation in the market firm
needs to do marking and it is done by the marketing department, so in such a way it is
interrelated with one another (Lane, 2016). IT software use by IKEA: Product information
assistance (PIA), product information assistance(PIA) but without marketing department firm
can't select the best software from suppliers. Marketing and sale department:
Main role of sale department is to sale the product by hook or crock. through marketing,
company can easily sale their product because of promotional technique( like advertisement,
direct marketing etc.) they can aware or educate the consumer regarding their product. By direct
selling no one can buy product. IKEA make a good relationship with consumer first, and than
made a positioning over their, and than sale it. So for positioning firm needs to do marketing.
 Research and development:
Taste and preference of the consumer are change from time to time, so company needs to
do the research. It can be done through primary (sample serve, questionnaire, door to door
serve), secondary (through intern ate, news paper, magazines, books, journals etc. which is
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already published). IKEA design 2000 affordable product on bases of demand of the consumers
and research. It is the world largest furniture company of the world. Product development is
managed by small team of in-house designer which is spread over 4000 square meter in Almhult,
Sweden and company design on factor floor also. Without the help of marketing company can't
communicate to the suppliers and than they are not able to buy the raw material from them. So
for development also association do marketing. Marketing and human resources department:
The main role of human resources department is to recruit and select the employees of
the organisation and these are the back bone of the company without it firm can't survive in a
long run for this company needs a lot of people who can associate with them (Mihart, 2012).
Marketing help in recruitment by giving advertisement and promotional techniques. IKEA
manager use the management process:
1. mission and vision
2. Environmental analysis
3.strategy formulation
4. implementation
5.evaluation
HR manager first intimate the mission and vision to the entire staff in the organisation, so the
goals are specific and certain.
TASK 2
P3 Compare the marketing mix of two different organisation:-
Marketing mix refers to the set of marketing tools that an marketer blends for promoting
their product and services to get the desired response from the target market (Moore, 2014.).
IKEA uses these tactics to determine how business objectives can be achieved. Following table
shows the marketing mix tools of IKEA in comparison with Walmart.
Elements IKEA Walmart
Product IKEA is largest furniture retail
company which deals in
various products such as
outdoor furniture, baby and
It is an leading company of
furniture which covers wide
range of product offering.
Walmart product includes
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children's product, bathroom
stages, desks, mirror, eating,
beds and mattresses, chairs,
decoration products, kitchen
cabinets, appliances, lightning,
sofas and many more.
small space furniture, office
product, sofas & couches, TV
stands, dinning room sets, kid's
furniture, bar stools, kitchen
and dinning furniture, etc.
Price It follows cost leadership
pricing strategy and provide
high quality product at
relatively low price as it
provide competitive advantage
to the company. IKEA also
uses psychological pricing
method.
Walmart achieve greater
success by using Everyday
Low Price(EDLP) Strategy
that offer low price on their
product for whole year rather
than occasionally that help
company to achieve customer
loyalty and increases sale.
Place It is an multinational company
that sell its product and
accessories in various
countries such as Asia,
Australia, North America and
Europe. IKEA uses online
channel to sell its product
through its website. There are
340 stores in 28 markets
around the world.
Walmart is an international
company which trade there
products in 27 countries with
more than 10000 stores under
71 banners. It has more than
173 distribution centres which
helps in reducing
transportation costs and
handling cost.
Promotion IKEA do a lot of promotional
actives by using T.V,print
media, online ads, billboards
etc. in its marketing mix.
IKEA use online advertising
Walmart promote through a
sales promotion technique
such as product bundling and
its competitive pricing
strategy. E-commerce
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technique in which product
demonstration of the problems
faced by the people, and
provide solutions.
website,by offering gifts to
the consumers.
People IKEA focus on employees and
other member of the
organisation. People are
passionate, enthusiastic, and
straightforward regarding to
their work which is related
with furniture (Nguyen and
Simkin, 2012). Consumer
satisfaction is the core value.
It is global organisation that
why they more focus on
people. Employees and staff
are the assets of the company
so company needs to maintain
them. Walmart provide
training to their employees so
they will skilled and they can
achieve there target on time.
The staff is highly motived in
this company. Walmart has a 2
million employees and they
want to reach up-to 200
million
Process It has a several process in
place. It has a 44 production
unit in 10+countries. IKEA has
a own mills and they produce
high quality furniture for their
customers and also use high
technology. It follows most
unique supply chain
management. Its designs are
differentiated on the bases of
price.
Process of Walmart are
extremely efficient and easy to
execute in the stores. The
process include having
smoothly available trolleys,
systematic product placement
and categorization, multiple
payment counter, various
modes of payment etc.
Physical Evidence IKEA has 350+stores in 50 Physical evidence of the
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countries. Physical evidence of
this company is huge store
layouts which gives lot
benefits to the consumers. It
has a specific path layout once
people goes into the store and
guide arrows that helps the
consumer to achieve their
product. Stores are also have
baby care area, and equipped
with restaurant for
refreshment.
Walmart is in more than
11000+stores across the world.
Every store has multiple
category of product and
effective layout of it. Several
offices of Walmart spread
around the world.
TASK 3
P4 Marketing plan of IKEA:-
 Overview of the company:-
IKEA is an leading retail industry that design and sell furniture all over the world.
It provide ready to assemble wooden items that are delivered to customers place in parts
and assembled afterwards. Company also provide its services online where its website
contains 12000 products to display.
 Visions and mission statement:-
Vision of IKEA is to provide better standard of living to people around the world
by offering variety of home furnishing product at relatively low price that can be
affordable by general public.
Mission of IKEA is to increase the customer base by satisfying the end user
through their value providing services and solving their issues to retain existing
consumers.
 Objective:-
1. To increase its market share by 4 % within an year.
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2. To achieve an average customer spend of 58%.
 STP:-
STP is abbreviated as Segmentation, Targeting, Positioning. It is an marketing strategy
that is used by companies to segment its customer according to their demand specification, after
that targeting their promotional efforts on those segments to attract customer and then
positioning the product in market (Papasolomou and Melanthiou, 2012).
Segmentation- Segmentation refers to dividing the potential customers or market into sub
groups on basis of their characteristics. IKEA segments their customers in Geographical,
Demographical, Behavioural and psycho-graphical basis and serve product accordingly.
Target- Targeting refers to concentrating marketing efforts on an segment to match the demand
of customer with the company's product. IKEA's targeting strategy allows the company to target
its product to the customer who require such product.
Positioning- Positioning is an marketing strategy that fixes an locus of product in the mind of
customer. IKEA positions itself as an low price furniture manufacturer that provide quality
product.
 SWOT analysis:-
SWOT analysis is used to identify the strength and weakness that an company has
and Opportunities and threats that required attention as they affect the growth and
profitability of business (Pike, 2015). IKEA uses SWOT analysis to determine how
internal and external environment affect its operations.
Strength Weakness
 IKEA has restaurant that provide
facilities to visitors so that they can stay
in store. This help company to increase
consumer spending up to 50%.
 IKEA provides tips and ideas to their
customers over internet to solve their
issues.
 It provides high quality product at low
 IKEA has its stores in various countries
which make it difficult to maintain
quality and standards.
 Its main focus is to provide low price
affordable product that may decrease
the quality, that may reduce the market
share.
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price to the target market.
Opportunities Threat
 IKEA's policies include charity support
such as Save the Children, UNICEF
etc. as an act of social welfare that
creates brand awareness among public.
 Company also sell its products online
that provides an opportunities to attract
and serve large customer base around
the world.
 Changes in laws and trading policies
leads to increase in operating cost and
reduction in profit.
 Competitors are imitating the products
to generate sales, so company need to
innovate and update their items to stay
unique in their offerings.
 Marketing Budget:-
IKEA creates its marketing budget that help it to estimate the fund to be required
to promote and place product & services in the market to ensure smooth functioning of
business without any delay.
Marketing budget
Particulars 1st year 2nd year 3rd year 4th year 5th year
Initial money 8000 5000 10000 12000 18000
Investment 18000 25000 35000 18000
Total 8000 23000 35000 47000 36000
Marketing outlay
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