IKEA case study

IKEA offers a wide range of home furnishing product items of good design and function at prices so Low that the majority of people can afford them. Originally targeting the young buyers, who often looking to furnish their first apartments. 1953 in Almhult sales of IKEA were mail order business with 40-80 times larger turnover of the average furniture. (95.23% of the SKr 16.8 million turnovers were from mail-order business). In 1965 Kamprad opened new outlet in Stockholm on …

…designs for older, richer people. IKEA is also willing to locate new stores at A-class sites. In this case product diversification is necessary but IKEA should not overextending themselves. Diversification is at best a risky strategy but IKEA should consider expand their market segmentation because of the current product seems to provide no further opportunities growth. With a strong brand name and a few changes in distribution channel will help IKEA to achieve its goal.