IKEA's Global Marketing Strategy

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Case Details:

Case Code : MKTG119
Case Length : 19 Pages
Period : 1998 - 2005
Pub Date : 2006
Teaching Note : Not Available
Organization : IKEA
Industry : Furniture Retail
Countries : Sweden, US and China

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Excerpts Contd...

The IKEA Buzz

A big contributing factor in the growth of the IKEA brand was its ability to weave a story around itself. For instance, before the opening of its store at Atlanta, USA, in June 2005, IKEA invited locals to apply for the post of Ambassador of Kul ('Fun' in Swedish). The five participants had to write an essay on why they deserved US$2,000 in gift vouchers...

Promotional Strategies

IKEA's advertising campaigns were based on unique marketing conditions and cultural sensibilities of each country, which varied significantly across markets. For example, European advertisements, especially in the UK, were more straight-forward than those in North America, which were generally more witty. IKEA was present in some countries such as Canada, Australia and Germany for over twenty five years while in countries such as the US, Britain and Italy, it had been around for only a little more than a decade.

Over the years, IKEA had worked with different advertising agencies to bring out some of the most creative and unconventional television spots across the globe. For these reasons, an IKEA account was considered a choice catch as it allowed the agency the freedom to explore some interesting and unexplored ideas...

The Controversies

In spite of its success all over the world, IKEA was criticized for traffic jams and overcrowding at its outlets, particularly at store openings which brought in frenzied crowds.

In September 2004, three people were crushed to death and sixteen were seriously injured in a stampede that broke out at IKEA's store opening in Jeddah, Saudi Arabia.

More than 8,000 people had gathered near the store for the US$150 gift vouchers, some of them having camped overnight...

Exhibits

Exhibit I: Facts on Ikea
Exhibit II: Ikea's Foray into Foreign Countries
Exhibit III: Excerpts from 'The Testament of a Furniture Dealer'
Exhibit IV: Ikea's Biggest Suppliers of Raw Material
Exhibit V: Boklok Homes