Strategic Planning is the process in which the organization focuses on it's long-term goals and objectives, and then determining the best approach for achieving them. Ikea's long-term goal is to be the leader in the home furnishings market. In achieving this, Ikea offers quality, functional home furnishing products at a low price so that as many people as possible can afford them. Ikea believes in having a good relationship with their suppliers so they are able to buy good quality, economically produced products that is purchased in bulk to keep the cost down. Flat-packaging helps in keeping costs down as well by saving on shipping, labor, and assembly costs. In the functional designs of their products, they like their products to be practical and easy to use. There's is no use for unnecessary features because it only increases the product's cost.
In reference to the four P's:
Product: Home furnishings including children's rooms, lighting, textiles, storage, dinnerware and cookware. Customized rooms and wardrobes are available online. Also, products now for business areas with Ikea's Business.
Place: Stores located internationally in countries such as China, Japan, Canada, The United States, and Australia. And all stores include a restaurant, or cafe, inside to provide a place to eat and relax while shopping. Many Ikea stores are designed in a "one-way" layout which leads the customers though the store "the long natural way." They can see what the store has to offer in its entirety and make note of the items they want to purchase. Then the customer takes a shopping cart and goes to an "open shelf" warehouse, which usually shows textiles like art prints, or rugs. Lastly, it leads into the furniture warehouse where they pick out their choice of items, they noted from before, in flat packaged form and make a payment.
Promotion: The Ikea catalog is the main marketing tool, which is free of charge. Last year 198 million copies of the catalog were printed in 56 editions and 27 languages. Also, you can get updates though email and request a catalog.
Pricing: Depending the product, it can go from less than a dollar to over three hundred dollars.
S.W.O.T. Analysis:
Strengths: Low Prices for good quality, Strong brand image, Internationally known brand, Environmently friendly and cost-effective products.
Weaknesses: Low cost furniture may makes buyers think it's low quality as well, Self assemble furniture is not ideal for the elderly.
Opportunities: International expansion, Moving from international to global status through store openings in Asia and Eastern Europe, E-commerce.
Threats: Direct stores (furniture stores) and indirect stores (Target, Macys), other retail marketers are starting to imitate the low cost flat packaging furniture Ikea's known for.
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