Successful Tips Business Owners Should Learn From IKEA
IKEA’s history goes back more than 60 years. The founding father of IKEA, Ingvar Kamprad, is worth $78.1 billion today. Even though he is so rich it’s rumored that he still buys second-hand clothes which may be true as he grew up in impoverishment. However, he’s developed a way to display and showcase products that bring a better consumer experience. IKEA reportedly has a technique for selling their products, services, and goods in a way that offers the consumer a great experience, and this is a method that other businesses should implement by incorporating this in their sales plans. Business owners will increase their revenue if they follow these tips. The additional revenue generated is the result of a “side hustle with extra revenue generated” as it opens more opportunities for growth. Wal-Mart and Target stores are examples of this strategy in the “side hustle” ROI for companies. In their grocery food markets they sell their own brand-named foods.
How IKEA creates a unique consumer experience?
Diversifying is key for the future of any business. Increasing a company’s profitability is part of any business’ future. In other words, profitability is in diversifying the business. In the case of IKEA, many people go to their stores to eat. At least 30% of consumers who go to an IKEA store are there to experience eating as something that fits well with shopping. When shopping for furniture, appliances, or basic home goods, taking breaks in large warehouses is good for our mental and physical endurance. It also helps you to experience using the brand new shiny refrigerator or bedroom set you will be buying soon while taking note of some other items in the store.
This is the reasoning behind why shopping for home furnishings, and dining out, were combined in IDEA stores. And it was confirmed by the positive reactions from 650 million people in 48 countries a few years ago. In fact, this concept inspired the “pop up” restaurants in Europe; including London, Paris, and Oslo. This eating trend in home furnishing shops is unique and gives an ultra-consumer experience for anyone wanting to shop and eat all in the same place.
Initially, this type of shopping experience proved effective when it began in Sweden, where the owner of the stores originally began his home and appliance furniture stores. When you blend shopping for home furniture and appliances and eating home-made food, you achieve the IKEA experience. IKEA included Swedish food for its patrons to enjoy along with their shopping experience. The menu includes potatoes with Swedish meatballs and cream sauce. It also includes jam (lingonberry), for those who like sweets as well as desserts for customers.
How IKEA showcases their products?
IKEA showcases their products in a strategic way. The IKEA firm pays close attention to controlling the prices and the details of product display through the years. This is how IKEA showcases its products using their successful layouts which is the key to the company’s success.
IKEA stores are the color of Sweden’s national colors: blue and yellow. They also have a few windows. Each store showcases their products in a counter-clockwise layout which is what the billion-dollar company calls “the long, natural way” which is designed to lead consumers through so that they see the entire store. All IKEA managers showcase their products according to this layout.
When consumers walk through an IKEA store they go through the furniture showrooms first. The next area has shopping carts for small items, before walking through the open shelf “Market Hall.” Then, there’s the furniture warehouse that is a showroom of packed up furniture in boxes or “flat pack” formats. In other words, customers have an easy “self-serve” place to shop. The customers are directed to get the products on site and pay at the register, much like Home Depot and Lowe’s has done today. Most “for sale at a discount” items are at the back, or end, of this counter-clockwise layout. These consist of damaged, or returned goods, and former display items that are now for sale.
Why IKEA places low price products at each corner?
When people turn the corners at the grocery stores or markets, normally they will look up and down at those corners, and normally stop. Since most shoppers have baskets, they tend to leave those baskets there at those corners or “hot-spots.” A hands-free customer can walk through a grocery aisle without their baskets because they can leave them at the end of the aisle as it is part of the system. It’s these pivotal corners that are ideal for low-priced products. Before they go through the entire food-lane, customers stop, look, and spend more time in these hot-spots than anywhere else.
Why IKEA sometimes sells dreams and not products?
Selling a dream is basically selling the idea of how to market your products. Once you do this, and follow through, everything else falls into place. Therefore, it’s true to say that IKEA does, sometimes, sell a dream. Looking at it from another perspective, displaying the dream kitchen, or the dream living room or bedroom is implementing the IKEA method in their showrooms. After purchasing home furnishings, it’s the consumer who has to put the product together at home by self-assembly.
Why aren’t some products available, but the display will showcase the products on site?
In fact, it’s the tutorials, displayed products, and showcased rooms that are unique and allow for that “dream” to come true for IKEA customers. If the product isn’t available in the warehouse, or store, then going online is the method you’d have to go to. The order will get shipped from Sweden’s main warehouse to the customer’s address or doorstep where all things have to be assembled by the customer. The dream is the plan to put the home furnishings together. Perfecting the design for the consumer and, if need be, the experts help with videos, and the necessary tools to do this.
Why IKEA sells the same product but with a range of pricing (i.e. dining, bedroom, living… )?
When there’s a product for sale, such as a dining table showcased beautifully near a displayed kitchen, a range of pricing is there as well. That’s okay for the customer because what is not desirable can be desirable for someone else. It’s a stunning success. Some consumers may only want the stove, but not the products within and around the entire display of other products. Therefore, placing products with a range of pricing is common in IKEA stores. Consequently, a customer will find something to buy among the entire display or showcase of goods, even if it’s only one item. A price ranging occurs when you don’t buy 2 for a $1.00, but only want one, so you’ll have to pay.59 cents. Therefore, you pay a little more if you don’t buy two of an item. This is also the bulk pricing method which is common in huge markets like Sam’s Club has done in the past.
Why IKEA places unsalable items next to hot items?
If you see a hot item, then the items around it are mainly for “looks.” Therefore, when you see that the items are there with that huge cabinet set you like, but the dishes in them aren’t for sale, then it’s just another way of showcasing successfully. The purpose is for you to more easily imagine your dishes in those IKEA cabinets instead of theirs.
Finally, when the founder began this company, he probably never thought it would grow and help so many businesses when they follow his lead.