Analyzing IKEA’s Market Entry Into India – Case Study Challenge | Learning In Real Life
When the world’s largest furniture retailer, IKEA, decided to enter the second-most populous country in the world, it wasn’t mere news. Founded in Almhulty (Sweden) and headquartered in Leiden (Netherlands), IKEA took 12 years to enter India with quite a few firsts (departure from its global practices) for its ‘long-term’ play. IKEA built a global business empire selling affordable, Scandinavian-design inspired furniture with DIY model. Having honed the IKEA WAY over 51 countries with 403 stores and $40.2 billion sales, IKEA’s India entry was quite the news globally and in the Indian business landscape. IKEA’s entry was news for a few firsts as it entered India.
Based on key information and data provided in this case study, analyse IKEA’s market entry strategy into India and answer the following questions:
- Identify the target customers IKEA aims to serve.
- What channels are the most effective to reach IKEA’s target consumers?
- Analyse the factors involved in segmenting target customers.
- How do you think IKEA matches customers’ spoken and unspoken needs?
- Use the SWOT analysis framework to analyse IKEA in India.
- Define the types of markets IKEA caters to in India.
- Based on Porter’s 5 Forces framework, analyse which type of strategy IKEA focuses on in India – leadership, focus or differentiation.
- Use segmentation and group customers shopping at IKEA.
- What kind of pricing strategies do you think IKEA should focus on in Indian markets?
- You are the CMO in charge of IKEA’s India launch. How would you work on segmentation, targeting and positioning for your product?
- IKEA aims to serve urban customers who want modern furnitures at affordable prices.
- Online selling through E-commerce platforms would be the best channel to reach target consumers as Urban dwellers prefer online shopping.
- Demographic – Young people in the age range of 25-40 years old residing in cities. Economic – Upper middle class. Nature – Environment friendly non wooden furniture
- Customers spoken needs such as design, price and lightweight are inherent to the product while unspoken needs such as Reliability, Durability, After sales service are part of the package.
- Strengths – Unmatched product Quality and International experience. Weakness – Distribution network. Opportunities – Growing urban population. Threats – Competitors and unorganised players.
- IKEA caters to young, tech savvy, middle income urban population.
- IKEA differentiates itself from others in offering Niche products which are practical.
- IKEA should price the products competitively in order to attract large number of consumers.
- IKEA is for the customers looking for Modern looking furnitures. It is for the buyers who want good aesthetics coupled with utility. Its product are simple yet elegant.
I have referred the textbook concepts to support the answer.
Based on the Passage:
- Targeting most probably Urban Users
- With Pepperfry and Urban Ladder being a convenient option, IKEA will most probably also try an online approach
- Urban Population, Prefers Quality over Price.
- Spoken – Assembled by IKEA, Durable, Affordable
Unspoken – Style, Fashion Statement
I am not sure its credible :p
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