IKEA

IKEA - Marketing Plan for Internationalization

Executive Summary

IKEA is the best furniture retailer in the world. The company which was started by the founder at the age of sixteen from Sweden is now a global player and has outlets all across the globe. as part of the internationalization strategy, the company wants to enter the Indian market. India is one of the fastest growing economies of today and the economic growth is expected to outpace that of China in the coming years. The paper discusses the launch of IKEA in India, the reasons for choosing IKEA over alternate markets and the marketing mix for IKEA in the Indian market.

Table of Contents

Introduction1

Vision1

Products1

Market Outlook and Internationalization2

The Indian furniture industry2

Available alternatives4

SWOT Analysis5

Strengths5

Weaknesses6

Opportunities6

Threats6

Marketing Mix7

Product7

Price9

Place10

Promotion11

Conclusion12

References14

IKEA - Marketing Plan for Internationalization

Introduction

IKEA is a Swedish worldwide retailer of home products company. The unique characteristic of IKEA furniture is that it is ready to assemble. The company offers a wide range of home products that are functional and affordable at the same time. The company is dedicated to making its products affordable for all and the idea is central to everything that is done at IKEA. This is what differentiates IKEA from other home products manufacturer and retailers. Designing quality furniture and selling it at a premium price is not something that anyone can do, but designing high quality products and that too for a lower price is something that only IKEA excels at. It is because of this reason that cost-effectiveness and innovation are embedded in the very culture of the organization. The company saves on cost and pass on the advantages of lower cost to its customers.

Vision

IKEA wants to create a better every day for all its valued customers.

Products

As stated, the company offers a range of products for its valued customers. These products are categorized not by their type but by the philosophy that goes in their manufacture, retail, shipments and sale. The price tag first range is the one that focuses on operational excellence to deliver premium quality at lower cost (Young 2008, p. 12). For instance, the 'price tag comes first' and then the material is chosen. Similarly, the 'Flat packing' range is another philosophy of reducing the shipment cost. Some of the products of IKEA include beds, armoires, tables, dressers, entertainment centres, chairs, chest, and benches.

Market Outlook and Internationalization

As part of the internationalization strategy and market growth, there were many options available for IKEA. Out of the various regions that IKEA could have expanded into, it chose to enter the Indian market. The reasons for this choice are discussed hereunder (Tracogna 2011, p. 45).

The Indian furniture industry

India is one of the emerging markets of its region and the world. According to a World Bank report published in the year 2011, the Indian economy will outperform the Chinese economy in the coming years. There are certain factors that are responsible for this phenomenal growth. The growth for the year 2011 was 8.7% (Tracogna 2011, ...