This case study provides information about Ikea’s growth strategy which is based on a cost leadership with high degrees of standardization and only a few local adaptations. Applying growth drivers, marketing mix and internationalization strategy, the case gives profound insights into the company’s success and how it was achieved. Key value of the case involves critical assessment of Ikea’s internationalization and recommendations to maintain growth. Outcome of the study was that Ikea is dependent on certain growth drivers that include company values, prices, product range, places of distribution and advertisement on the internal side of the company and governmental actions, growth of the population, mergers and sustainability on the external side of the company. Ikea’s growth strategy seems to be very successful. Nevertheless, the company has to face several challenges regarding its internationalization process. Through governmental regulations, too superficial market research and different tastes of customers that lead to a necessary adaptation to local circumstances, Ikea needs to avoid being outperformed by its competitors.
Inhaltsverzeichnis (Table of Contents)
- Introduction
- Models
- Growth Drivers
- Internal Growth Drivers
- External Growth Drivers
- Difficulties of Internationalization
- Recommendations
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
The objective of this case study is to analyze IKEA's growth strategy, focusing on its cost leadership approach, standardization, and limited local adaptations. The study aims to understand the factors contributing to IKEA's success and identify potential challenges related to its internationalization.
- IKEA's cost leadership strategy and its impact on growth.
- The role of internal and external growth drivers in IKEA's success.
- Analysis of IKEA's marketing mix (4Ps) and its contribution to growth.
- Challenges faced by IKEA during its internationalization process.
- Recommendations for maintaining IKEA's growth and market position.
Zusammenfassung der Kapitel (Chapter Summaries)
Introduction: This chapter introduces the IKEA Group, the world's largest furniture retailer, highlighting its cost leadership strategy and significant growth. It outlines the case study's aim to analyze IKEA's growth strategy and identify potential threats associated with its internationalization. The chapter also previews the methodologies employed, including the analysis of growth drivers, the 4 Ps of marketing, and internationalization strategies. The overall tone sets the stage for a detailed examination of IKEA's success and the complexities of its global expansion.
Models: This chapter details the analytical frameworks used in the case study. It introduces the concept of internal and external growth drivers, differentiating between factors originating within the company and those stemming from the external market environment. The 4 Ps of the marketing mix (product, price, place, and promotion) are presented as a lens through which to evaluate IKEA's internal marketing strategies. Furthermore, the chapter explores internationalization strategies, contrasting standardization (economies of scale through mass production) with adaptation to local markets. The discussion of waterfall and sprinkler market entry strategies provides further context for understanding IKEA's global expansion approach and its inherent risks and benefits.
Growth Drivers: This chapter delves into the factors driving IKEA's exceptional growth, categorizing them as internal and external. Internal drivers encompass company values, pricing strategies, product range, distribution channels, and advertising. External drivers include governmental policies, population growth, mergers and acquisitions, and sustainability considerations. The chapter highlights IKEA's resilience during the post-2008 recession, attributing its continued success to its affordable furniture, despite competitors experiencing significant sales declines. This section provides a concrete analysis of the specific elements contributing to IKEA's market dominance.
Schlüsselwörter (Keywords)
IKEA, growth strategy, cost leadership, standardization, internationalization, marketing mix (4Ps), growth drivers (internal and external), market entry strategies (waterfall, sprinkler), global expansion, challenges, recommendations.
IKEA Case Study: Frequently Asked Questions (FAQ)
What is the main focus of this case study?
This case study analyzes IKEA's remarkable growth strategy, paying close attention to its cost leadership approach, standardization practices, and the extent of its local market adaptations. The goal is to understand the elements contributing to IKEA's success and to identify potential challenges related to its global expansion.
What are the key themes explored in the study?
The study explores several key themes, including IKEA's cost leadership strategy and its impact on growth; the role of internal and external growth drivers; a detailed analysis of IKEA's marketing mix (4Ps); the challenges encountered during internationalization; and finally, recommendations for sustaining IKEA's growth and market leadership.
What analytical models are used in the case study?
The case study utilizes several analytical frameworks. It categorizes growth drivers as internal (originating within the company) and external (stemming from the market environment). The 4 Ps of marketing (product, price, place, and promotion) serve as a lens for evaluating IKEA's marketing strategies. Additionally, the study examines internationalization strategies, contrasting standardization (economies of scale) with adaptation to local markets, and comparing waterfall and sprinkler market entry strategies.
What are some examples of IKEA's internal and external growth drivers?
Internal growth drivers include IKEA's company values, pricing strategies, product range, distribution channels, and advertising. External drivers encompass governmental policies, population growth, mergers and acquisitions, and considerations of sustainability. The study highlights IKEA's resilience during the post-2008 recession, attributing its continued success to its affordable furniture offerings.
What are the key challenges faced by IKEA during its internationalization?
While the specific challenges aren't explicitly listed in the provided summary, the study indicates that the analysis will cover this area. The inherent risks and benefits of IKEA's global expansion approach, particularly concerning standardization versus adaptation to local markets, are discussed as a key area of the analysis.
What recommendations are made in the case study?
The summary indicates that the case study will conclude with recommendations for maintaining IKEA's growth and market position. These recommendations would likely address strategies for navigating the challenges identified during the internationalization process.
What is the structure of the case study?
The case study is structured into chapters including an introduction, a section detailing the analytical models employed, a chapter focusing on growth drivers, and a conclusion offering recommendations. Each chapter provides a detailed analysis of specific aspects of IKEA's growth strategy and internationalization efforts.
What are the keywords associated with this case study?
Keywords include: IKEA, growth strategy, cost leadership, standardization, internationalization, marketing mix (4Ps), growth drivers (internal and external), market entry strategies (waterfall, sprinkler), global expansion, challenges, and recommendations.
- Quote paper
- Viktoria Klima (Author), 2017, It's IKEA's World. A Growth Strategy Based on Cost Leadership, Munich, GRIN Verlag, https://www.grin.com/document/446483
