chelsea 8-2013-mscsm-dl-presentation
DESCRIPTION
The project draws attention to IKEA’s usage of multiple channels to reach its customers, however, it also points out the fragmentation of these channels. On detailed analysis, the report makes the following recommendations: • Improve process efficiencies to cope with logistics and ecommerce • Shift from Multi-Channel to Omni-Channel • Integrate offline and online initiatives • Implement emerging technologies This report concludes that these recommendations will help IKEA remain differentiated and maintain market leadership in an industry that is continuously evolving.TRANSCRIPT
DIGITAL LANDSCAPE CHELSEA 8
December 10th, 2013
Table of Contents
•Introduction•Digital Challenges & Opportunities •Competitors•IKEA’s Business Strategy•Multi-Channel v.s. Omni-Channel
• IKEA Catalog• IKEA Advertising
•Current Challenges & Recommendations •Conclusion
Introduction
Swedish furniture company started by Ingvar Kamprad in 1943
Largest retailer of ready-to-assemble furniture and furniture accessories globally. As of 2012, IKEA had:
• 298 Stores in 26 countries• €27 Billion in Sales
The most cost efficient furniture supply chain in the world
Opportunities & Challenges
• E-commerce/M-commerce
• Customer Relationship Management (eCRM)
• Social Media/ Word of mouth advertising
Opportunities
• Traditional buying behaviour
• Minimal interest on discussing Furniture online
Challenges
Digital Competitors
Types of furniture retailers
Digital media has changed the way in which furniture retailers both sell and market their products
• Websites & Mobile Apps- Online catalogues- E-commerce & M-commerce
• Social Media- Raise brand awareness
Multi-Brand Retailers Exclusive Brand Retailers
Digital Strategy
IKEA has leveraged digital media to adapt their business strategy in 3 specific ways
Restructure Consumer Journey
Improve Customer Relationship Management (CRM)
Leverage digital technologies to mitigate marketing costs
Multi-Channel
Digital media has led to the multiplication of touch points between businesses and consumers
Omni-Channel
“Truly integrated approach across the whole retail operation that delivers a seamless response to the consumer experience through all available shopping channels” (LCP Consulting 2013)
IKEA Catalog
The success of IKEA has largely depended on publishing the IKEA Catalog
IKEA Catalog
IKEA Catalog remained unchanged until 1997 when they launched their first website
1997
• Known as “World Wide Living Room Website”
• Contained limited product information and only provided a brief history of the company and company vision
1999
• Updated version included:- Product Guide- Assembly Tips- Store Locator - Ability to order
catalogue
2000
• Launched first ecommerce platform
• Tested first in Sweden and Denmark expanded country by country
IKEA Catalog
After substantial growth in sales from €7.6 Billion in 1999 to €21.5 Billion in 2009 due to digital initiatives, IKEA made two major adaptations to their catalogue
IKEA Catalog
IKEA Mobile Application• VIDEO: https://www.youtube.com/watch?v=NBv4FTnAlnE
IKEA Advertising
IKEA’s Social Media Channels
These Social Media platforms introduced the idea of content marketing
• “Creating and distributing relevant and valuable content to attract, acquire, and engage a clearly defined and understood target audience – with the objective of driving profitable customer action.” (Content Marketing Institute)
IKEA Advertising
THE FACEBOOK SHOWROOM• OBJECTIVE: Generate Buzz around the new store opening in
Malmö• STRATEGY: Leverage Facebook’s tagging functionality
IKEA Advertising
HAPPY INSIDE• OBJECTIVE: Challenge the perception that IKEA sells low-
quality furniture• STRATEGY: Let cats decide!• VIDEO: https://www.youtube.com/watch?v=8b1v5KDf2ts
IKEA Advertising
•EVERYDAY DIFFERENT• OBJECTIVE: Get consumers to explore IKEA’s vast range of
furniture • STRATEGY: Produce a commercial for every day of the year• VIDEO: https://www.youtube.com/watch?v=xFTZqlEEvAY
IKEA Advertising
•MAKE SMALL SPACES BIG• OBJECTIVE: Position IKEA as the solution for Small Spaces• STRATEGY: Utilize small spaces on the internet
Challenges & Reco’s
Channel Integration• Currently operating on multiple channels, but campaigns seem disjointed
• IKEA should ensure all campaigns online link to each other and have the common objective of driving to purchase
Digital Trends• New tools are constantly being invented, but it is impossible to activate on all of them • IKEA should plan to adapt Google Glasses and 3D printing
Fulfillment • Ecommerce has created increased demand for IKEA products
• IKEA should implement a real-time inventory reporting system
Google Hummingbird• Google is making the most changes to its algorithm since 2001 • All platforms will need to be integrated to ensure optimum search performance
Conclusion
IKEA has pioneered the use of digital media for furniture companies, however, IKEA is still evolving as an Omni-channel retailer
Continuous innovation without process efficiencies and integration will prove detrimental to the brand
Tack så mycket!