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TEAM

TEAM. Keyona Abbott Francisco Alvarez Kaitlin Bumpus Jasmine Ruiz. Overview. Founded in 1943 by Ingvar Kamprad Focuses on Frugality & Low Cost Over 226 Stores in 33 Countries 200 IKEA Group Owned, Rest Franchised 28 Stores in U.S. Älmhult, Sweden - 1953. Atlanta, GA - 2005.

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TEAM

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  1. TEAM Keyona Abbott Francisco Alvarez Kaitlin Bumpus Jasmine Ruiz

  2. Overview • Founded in 1943 by Ingvar Kamprad • Focuses on Frugality & Low Cost • Over 226 Stores in 33 Countries • 200 IKEA Group Owned, Rest Franchised • 28 Stores in U.S. Älmhult, Sweden - 1953 Atlanta, GA - 2005

  3. Functional Divisions • Production • Long-Term Supplier Relationships • Places Trading Offices Worldwide • Long-Term Contractual Relationships • Marketing • Product Design • Catalogs • Advertising • Public Relations/Sales Promotion

  4. SWOT Analysis • Strengths • Low-Cost Structure • Anti-bureaucracy • Do-It-Yourself Approach • Added Amenities • Weaknesses • Do-It-Yourself Approach • Service Trade-Offs • Limited Promotional Expenditures IKEA Catalog

  5. SWOT Analysis • Opportunities • Urban Sprawl • Value-Dominant Buying Logic • Growing Popularity of Swedish Design • Threats • Copycat Competitors • Changing Customer Needs

  6. Future U.S. Expansion • Advantages • Consumers Cost-Conscious • Melting Pot of Cultures • Barriers • Strong Individualism • Commercials Too Edgy

  7. Question 1 • Why are the styling and designs of IKEA products so popular? Does IKEA’s blend of style and pricing have appeal to mainstream U.S. consumers?

  8. Product Description Positive Negative Cheap Hard to install Low-Priced Bad Quality Not Unique • Trendy • Sleek • Low-Priced • Good Quality • Unique • Stylish

  9. Problems Price Self-Assembly

  10. Appeals To… College Students Kids Business Office Young Couples Sophisticated Family

  11. Demographics • Gender • Age

  12. Demographics • Education • Income

  13. Demographics • Race

  14. Question 2 • How do you account for IKEA’s growth & popularity: value or image? What can IKEA do to sustain growth after it loses some cachet? Hoovers Company Capsules and Profiles

  15. Image What do you think of when you think about IKEA? Appeals to Outside Mainstream Socially and Ethically Responsibility No plastic bags Owned by a charity Long term relationship with suppliers. Environmentally conscious production and manufacturing process

  16. Commercials 500 Days of Summer Dining Room Table I Don’t Judge

  17. Sustainable Growth Expansion into other markets Use successful business strategy in other ways Open smaller “mini IKEAs” Put products into other retail stores. Food from their café in grocery stores

  18. Question 3 • Speculate on what will happen at IKEA stores as they are tailored to fit local tastes. Is the company’s trade-off of service for low cost sustainable in the long term?

  19. U.S. Market • A lot of Americans live very busy lives and convenience and fast pace is very important • Most Americans are willing to pay the extra money for service rather than the do-it-yourself • It’s believed that the low cost do-it-yourself will not be sustainable in the U.S. and other developed countries

  20. American Invasion • Americans did not like IKEAs’ products at first…. • The sofas were too hard • Appliances did not match kitchen designs • Everything is do-it-yourself

  21. Advertising

  22. Advertising

  23. Advertising

  24. Fun Facts • Cheapest Item is a dog dish for $0.29 • There are 48 room settings and three model homes in an IKEA showroom • 522 million people worldwide went to an IKEA store last year • In 2006, IKEA stores & distribution centers handled 281,734 tons of waste. About 81% was recycled.

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