By Louise Porter,2014-04-17 03:58
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    Marketing Stratedy of Multinational Companies

    A Case Study of IKEA






    Nowadays, there are more than 65 thousand multinational companies all over the world. Though they have their own characters, they have something in common in their strategies. This essey take IKEA a example to figure out the strategies of multinational companies.

    Key words

    multinational companies; IKEA; marekting strategies



    The past century saw rapid growth of multinational companies around the globe. If companies want to achieve more market advantages, they must switch the marketing strategy from a traditional approach to a modern relationship marketing approach. The focus of marketing method has been changed from transaction to relationships. 1.2.Multinational corporation

    A multinational corporation (MNC) or enterprise (MNE), is a corporation or an enterprise that manages production or delivers services in more than one country. Many corporations have offices, branches or manufacturing plants in different countries from where their original and main headquarters is located. Multinational corporations can have a powerful influence in local economies, and even the world economy, and play an important role in international relations and globalization. 1.3.IKEA

    IKEA is a privately held, international home products company that designs and sells ready-to-assemble furniture appliances and home accessories. The company is the world's largest furniture retailer. IKEA starts the furniture business in the 1940s. From a small company become to a world famous transnational corporation, the development speed of IKEA is very fast. According to the “IKEA at a glance-

    financial year 2009”, the IKEA trademark represents the leading home furnishings

    brand in the world with more than 300 stores in more than 35 countries, more than 15,000 co-workers and 46 production units.

2.Marketing srategy of IKEA

    2.1.Insist in the IKEA concept

    The IKEA Concept is based on offering a wide range of well designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them. The IKEA Concept makes it possible to serve the many by providing low-priced products that contribute to helping more people live a better life at home. The IKEA Concept guides the way IKEA products are designed, manufactured, transported, sold and assembled. All of these factors contribute to transforming the IKEA Concept into a reality. The IKEA concept is based on low price; products are designed to offer prices that are 30 to 50 per cent lower than fully assembled competing products (Usunier, 2009). Beside, the important events in the development of the IKEA concept are the IKEA catalogue, which introduced to be able to sell the furniture on a larger scale, and the opening of the Älmhult showroom, giving the customers the opportunity to see and touch the furniture before ordering the products. Today, IKEA have more than 300 stories in more than 35 countries, most of which follow the same layout of having the showroom upstairs, and the IKEA catalog is distributed in each store.

    2.2.Estabilish the globe network

    In 1960, the first IKEA restaurant opens in the IKEA store in Älmhult, Sweden. In 1980s, IKEA expands dramatically into new markets such as USA, Italy, France and the UK. In 1998, IKEA arrives in China. The first IKEA store opens in Shanghai. In 2000s, IKEA expands into even more markets such as Japan and Russia. The IKEA opened 15 new stores at 2008 and in august 2009 had 267 stores, which welcomed a total of 590 million visitors during the year. A further 34 stores are owned and run by franchisees outside the IKEA group. IKEA group sales totaled 21.5 billion Euros. IKEA food services reported sales of 1.03 billion Euros. The IKEA group had 31 trading service offices in 26 countries, and 28 distribution centres and 11 customer distribution centres in 16 countries. The swedwood group, the IKEA industrial group had 15,000 co-workers and 46 production units.(source: IKEA at a glance- financial

year 2009)

the top 5 selling and supplier countries

    2.3.Differenet strategy in different culture

    IKEA try to keep a balance between globalgeneralization and local resistance. In 1985, IKEA arrived at the world’s No. 1 consumer market—the United States where “the

    American Lesson” has been learnt over 20-year’s time that North America is not like

    Europe. Torekull (1998) depicts that the staff in IKEA North America have begun to understand the potential benefits of working together. The clash of cultures, not seen in the beginning, is now examined in detail, and the resulting decisions affecting IKEA in both directions across the Atlantic. Japan was the other market than the USA where IKEA learnt its lesson the hard way. The company had to withdraw from the Japanese market in 1986 after a 12-year operation through franchises. It took IKEA 5 years to prepare for re-entering the country. IKEA Japan claimed to have conducted research on more than 100 Japanese homes in order to understand their way of living and their needs in everyday life. Therefore, IKEA is able to make twists and changes to fit with the Japanese consumer perception.


    With the growth of multinational companies around the globe, there are more and more experience can be learned. As a world famous international company, IKEA has its typical characters and the experience of success and failure, which is a good example for people to figure out the key factors to the success of multinational companies. For marketers in international business, IKEA has its own concept,

    explore the markets all over the world and use the different strategy based on the local features. These characters also can be fonud in other multinational companies. If the managers of the companies can find concept and strategy which belongs to their companies, the success is only the problem of time.


    Porter, M. (1985), The Five Competitive Forces that Shape Strategy, Harvard Business Review, p.86.

    Porter, M. (1985), Competitive advantage, the free press, New York London Toronto Sydney Singapore, p.4-20.

    Edvardsson, B. & Enquist, B. (2009).Values-based service for sustainable business: lessons from IKEA. London ; New York: Routledge.

    thArmstrong, G. and P. Kotler (2006) Marketing: an introduction, 8 ed. New Jersey:

    Pearson Education, Inc.

    Kling, K. and I. Goteman (2003) “IKEA CEO Anders Dahlvig on international growth

    and IKEA’s unique corporate culture and brand identity”, Academy of Management

    Executive, 17, 1: 31-37.

    Emma Beijerstam, Tourism Programme. A Global Working Place-A case study of IKEA.

    David Eskander, Mohamed Kotaiba Abdul Aal. Does IKEA Culture Apply Abroad?


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