IKEA Harvard Harvard Case Solution & Analysis


To solve its challenges, IKEA must adopt the market leader strategy and through this strategy, IKEA can expand its market shareby developing and defend its market share. For the expansion of its share ofthe market, IKEA must introduce itself into new market segment such as price sensitive segment of the market and through market penetration strategy.

Furthermore, to expand its market size IKEA must target the upper middle class segment where price sensitivity is higher than the durability of the furniture. The segment includes high mobility of homemakers that lives in American sub-urban areas, and students. The upper middle class segment is open-minded segment this segment is also technology savvy that would benefit the IKEA and it would improve its brand image.

IKEA should look for new market segment that would increase sales of its retail stores and it should look for furniture’s new uses that would also increase the furniture usage by the customers. For the new usage to increase its customer, IKEA must encourage and develop a new concept regarding the furniture to use. The concept should be according to the lifestyle that if any change in the life style occurs, it would also change the furniture style with it.

On the other hand, IKEA must not compete with the specialty stores or higher end furniture retail stores as these stores are providing furniture at higher prices with higher quality. Instead,IKEA focuses on its niche market, use those higher quality products as its benchmark.In the niche market, IKEA must position itself as market leader.

To guide and create awareness of IKEA’s furniture products, IKEA must establish IKEA club that would create value and it would help its customers regarding the furniture products IKEA offered.  The club members would help and guide each other that how to assemble the products and use those products. From that club, it would also encourage the customers to exchange the ideas about the IKEA’s products and propose further ideas regarding improving the product usage and style. By doing so, it would increase the customer’s participation in terms of design and style andit wouldhelpIKEA to improve its existing product offering.

IKEA must ensure its brand name through maintaining its core values and offering of its unique shopping environment at all of its retail stores. By doing so, it would protect its market share in its targeted niche market. The unique shopping, culturethat includes store decoration and store design, structure of store and services provided by the store would help the IKEA to provide satisfaction to its customers.

For the protection of its market share, IKEA should also consider adoptingmodified in its product matrix with accordance to the US market and it would be only be achieved if IKEA maintain its price, range of its product matrix and increases the styles offering that fulfills the need of the customers within the niche market. IKEA must adopt the strategy in which it uses the various communication channels to change US furniture market’s customer’s preferences according to IKEA’s product offerings.


IKEA must focus on to positioning itself as a one-stop shopping solutionfor all of the home furnishingneeds of the customers. It would help the IKEA to increase its market share. IKEA must focus on the upper middle class segment, as this segment is broad minded to accept the change in the furniture market IKEA had offered. Furthermore, it should differentiate itself through offering a wide range of value added products and services in the retail stores. The lower prices itself is the differentiation of IKEA, butwith this lower price, product IKEA must offera wider range of style in its products. If this would be adopted than IKEA’s goal of establishing 50 stores by 2013 is not far to attain...................................

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