IKEA Cult Brand Profile

People are camping outside. Traffic jams are so severe that highway exits must be shut down. Traffic lights are rendered useless requiring police to direct traffic. Is it a new Star Wars film? No, it’s the opening of a new Ikea store.

Started in 1943 by Ingvar Kamprad to sell a random assortment of products that he could sell at a cheap price from his house, Ikea has grown into a multinational furniture store. Ikea’s rapid growth continues to be driven by a strong attention to what their customers want: contemporary products that are affordable and functional. This isn’t a concept that is integrated into an aspect of the business plan. It is the driving force behind all decisions. The products are simple in design but visually appealing; they are simple to build, eliminating the need to hire an installer. To sell a mug as cheap as possible, Ikea made it available in only two colors—blue and white—because the pigments were the cheapest. Rather than follow traditional outlets for furniture manufacturing, Ikea obsesses over finding the perfect fit between manufacturer, product, and price—when they needed bent wood arms for a chair, they turned to ski manufacturers.

This attention to cost conscious customers doesn’t stop at the products, but extends to other aspects of the customers’ lifestyles. Understanding that most New Yorkers don’t own cars as they are inefficient and not cost effective, when Ikea opened their Elizabeth, N.J. location right outside of New York, they offered free shuttle service between Port Authority and the store every half hour. For cost-conscious customers, such a trip would have otherwise been too expensive.

Knowing that functionality is a big part of their customers’ buying decisions, when Ikea was designing their Chicago store they didn’t only ask for customer input on what they wanted in an ideal store, they asked them to work alongside with designers in conceiving the final product. After it was finished, no one rated the experience as poor or fair, and 85% rated it as very good or excellent. Return visits increased dramatically.

Functionality differs between regions, and Ikea takes it into account when designing their products. They don’t just have people complete surveys to figure out what they want. They go into their homes and see the ways they live. Visiting people’s houses in Italy and the United States led to the understanding that Americans store more clothing in drawers. The result: deeper drawers for their American products.

This attention to incorporating what their customers want is not lost on the customers. In one forum message, a user identified as bcbaird commented, “I like the Ikea cabinets because the money you spend goes towards the things that count … and not the things that don't.” And, the attention has paid off: from 1997 to 2005 Ikea doubled its market share and tripled its sales from $600 million to $1.7 billion to become the seventh largest furniture store in the United States.