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Case Details

Case Code: MKTG373
Case Length: 18 Pages 
Period: 2000 - 2019   
Pub Date: 2018
Teaching Note: Available
Price:Rs.400
Organization : IKEA
Industry : Furniture; Retail
Countries : China 
Themes: International Marketing/International Marketing mix/Positioning /International Management
Case Studies  
Business Strategy
Marketing
Finance
Human Resource Management
IT and Systems
Operations
Economics
Leadership & Entrepreneurship

IKEA's International Marketing Strategy in China

 

ABSTRACT

 
IKEA is considered a success story in China. But the Swedish furniture giant had to face numerous challenges when it entered China in the late 1990s. China was very different from IKEA’s traditional markets in the West and IKEA had to adapt its strategy to suit the country. IKEA was able to project itself as an aspirational Western brand among the Chinese middle class. After initial failures, the company positioned its brand in China in such a way as to reflect consumers’ needs and that enabled it to create a positive brand image for itself. China soon became the fastest growing market for IKEA, and the company saw significant growth in the country. However, with worldwide speculation over China’s increased economic and financial risks from its rapid build-up of debt and the company itself getting embroiled in controversies, can IKEA expand its market and sustain its business in China? The case discusses the challenges before Angela Zhu (Angela), country retail manager of IKEA China, in 2017, as the company went ahead with its plans to grow its stores in China from 24 in the fiscal year 2017 to 34 in 2020. The onus was on Angela and the marketing team to make this happen by appealing to the Chinese customers and by increasing IKEA’s customer base in the country. .
 
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Issues

The case is structured to achieve the following teaching objectives:
  • Assess IKEA’s entry and expansion strategy in China.
  • Analyze the marketing strategies adopted by IKEA in China.
  • Examine the interaction of global and local forces in shaping market dynamics and consumers’ preferences in China.
  • Analyze the macro-environmental factors influencing IKEA’s operations in China.
  • Understand the challenges faced by IKEA and explore strategies for the company going forward.
Contents
INTRODUCTION
ABOUT IKEA
GLOBAL STRATEGY AT IKEA
FORAY INTO CHINA
IKEA’S INITIAL FAILURE
TASTING SUCCESS IN CHINA
CHALLENGES
THE ROAD AHEAD
EXHIBITS

Keywords

International Marketing; EPRG framework; Glocalization strategy; Standardization vs Adaptation; Mode of entry and expansion: International Marketing mix; PESTLE framework; Porter’s five forces model; Value-based Sustainable Service Business Matrix

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