Low Value Company

Founded by 17-year-old, Ingvar Kamprad, IKEA has become one of the most affordable and top furniture retailers in the world. When comparing IKEA to a traditional furniture company, such as Ashley Furniture Store, a consumer can easily spot the differences in-store styles. IKEA is known for its unique shopping experience and carefully designed store layouts. Many traditional furniture stores simply have each section of the space decorated with a couch, a small table, and some sort of floral decoration. Then, if you look to your right, you can see the different types of kitchen designs.

To your left, are the designs for your future bathroom. With IKEA, shoppers are “gently coerced into a predetermined path through cheerfully decorated model bathrooms, kitchens, living rooms, and bathrooms”(IKEA Invades America). This type of store layout appeals to consumers because it is an experience like no other. Traditional stores do not have the uncommon Scandinavian design and even if they wanted to implement it, the planning would take too much time without the root of the Scandinavian heritage.

When comparing sales from Ashley Furniture Store to IKEA, IKEA made around $38.3 billion in 2017, while Ashley Furniture Store made around $4.7 billion. This is due to the simplicity of IKEA’s website and attractive store setting. In 2017, there were 2.3 billion website visits from potential shoppers and 936 million shoppers visiting in-store. The company slogan of “low prices with meaning” really does show the company’s commitment to providing consumers with higher quality items with a price tag that does not break the bank account.

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Due to IKEA not becoming automatically successful in the United States, the company discovered that they needed to make changes in their furniture, to appeal to the American shoppers. By paying very close attention to the complaints of customers, IKEA adapted and adjusted its way of merchandising. It is because of this reason that I feel that IKEA has become so successful. They took the complaints to heart, made some changes, and in return, gave shoppers exactly what they wanted. IKEA is a completely self-service store, in which buyers pick up their item at the end of the store, transport it to their homes, and assemble them on their own. On IKEA’s website, they state “if you can do simple things like pick up your purchases and assemble them at home, we’ll keep prices low”. Taking this and their annual sales revenue for 2017, anyone can see how customers do not mind assembling on their own, they enjoy it, if it means lower prices. Customers will do anything for a deal. Unlike other furniture stores, IKEA has a childcare facility walking into the store, where children can play, while the adults do their shopping. The stores also include restaurants and attentive staff, so shoppers are never waiting to get help. IKEA is like no other furniture store, which is what makes them so unique and successful.