IKEA 7Ps of Marketing

IKEA 7Ps of MarketingIKEA 7Ps of marketing comprises elements of the marketing mix that consists of product, place, price, promotion, process, people and physical evidence.

Product.  There are 9500 products across IKEA range and the company renews its product range annually launching approximately 2,500 new products[1]. IKEA products are designed by its in-house, as well as, contracted designers.

IKEA promotes the idea of democratic design. The furniture maker adheres to the following five dimensions of democratic design: form, quality, function, sustainability and low price.  IKEA products are associated with no-frills simplicity to sustain its cost leadership business strategy.

Place.  IKEA promotes itself as a multi-channel retailer effectively integrating online and offline sales channels. IKEA Group operates 340 stores in 28 markets around the world[2] Additionally, IKEA has 22 Pick-up and Order Points in 11 countries, 41 Shopping Centres in 15 countries and 38 Distribution sites in 18 countries[3]

The global furniture retailer also uses online sales channel extensively to sell its products to the target customer segment. Its website ikea.com attracted 2.1 billion visits in FY 2016, an increase of 9per cent compared to the previous period. Moreover, 110 million visits we made to Visits to the catalogue and store apps during FY2016.[4] Nevertheless, store sales still account for 95per cent of the IKEA Group sales.

Price. IKEA uses cost leadership pricing strategy.  The company offers its products “at prices so low that as many people as possible will be able to afford them”[5]. The home improvement and furnishing chain is able to maintain its low prices due to the economies of scale the company benefits from in the global level.  Psychological pricing also represents an important aspect of IKEA pricing strategy in a way that the retailer appeals to emotional, rather than rational side of customer decision-making. Accordingly, IKEA applies Price Point Perspective (PPP) 0.99 Cents instead of 1 US Dollar for the majority of its products.

IKEA Group Report contains a full analysis of IKEA 7Ps of marketing and IKEA marketing strategy in general. The report illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces, Value Chain analysis and McKinsey 7S Model on IKEA. Moreover, the report contains analyses of IKEA leadership, organizational structure and organizational culture. The report also comprises discussions of IKEA business strategy and addresses issues of corporate social responsibility.

IKEA Group Report

[1] Group Yearly Summary (2016) IKEA Group

[2] Group Yearly Summary (2016) IKEA Group

[3] Group Yearly Summary (2016) IKEA Group

[4] Group Yearly Summary (2016) IKEA Group

[5] Group Yearly Summary (2016) IKEA Group