IKEA has been in the news recently for its many successes in China.

IKEA seems to have figured out “glocal”, as it applies to the country – in a way that has eluded foreign retailers such as Best Buy, Home Depot, Media Markt and most recently Tesco (all of whom either bailed on China or gave up on trying to crack the market alone).

Screen Shot 2013-08-21 at 11.29.20

The products had to be adapted in three main ways:

First, they needed to be displayed in a way that mimicked Chinese style apartments, which are considerably smaller than most western housing spaces. They have also made their showrooms more liveable, often shoppers will try out the beds by taking a nap and are invited to use the kitchen ware to make a snack.

Second was the pricing issue. The “low-cost” tagline IKEA proudly wears was far from true in China as it stood at the top of most furnishing budgets. In developed markets IKEA is positioned as a low-priced mass-market brand, but in emerging markets where low prices are the norm, it targets a growing middle class that aspires to international lifestyle products. For these customers, design and a comprehensive range under one roof are the attraction.

Third, The DIY trend is not something the Chinese find “fun”. IKEA has began selling less to-be-assembled furniture and is discussing a delivery and assembly service for more complicated items in the store.

IKEA has also tailored their store locations, product lines and overall brand value to beeter suit each market. A few examples:

ikea-strategies_070113030017Read more about IKEA’s adaptation and brand strategies here.

Read about the recent opening of their Shanghai showroom that drew 80,000 people on opening day here.

Read about IKEA being one of the largest foreign landowners in China here.

Advertisements