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Made for Marketing MBA class at the University of San Francisco.
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The project analyses the importance of branding for Ikea and can help us to find out about IKEA's SWOT analysis and the STP process for Ikea. It also gives information on Ikea's Vision and Mission and Ikea's Marketing Mix, Ikea's Pestle Analysis, Ikea's Five Forces Model, Ikea's History and Ikea's Products and Services.
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Global Strategy and Organization Global Strategy and Organization c h a p t e r Learning Objectives In this chapter, you will learn about: > IKEA’s Global Strategy Furniture retailer IKEA is a Swedish company that has transformed itself into a global organization over the past three decades. Ingvar Kamprad founded the firm in Sweden in 1943 when he was 17 years old. IKEA originally sold pens, picture frames, jewelry, and nylon stockings—any product that Kamprad could sell at a low price. In 1950, IKEA began selling furniture and housewares. In the 1970s, the company began expanding into Europe and North America. IKEA’s philosophy is to offer quality, well-designed furnishings at low prices. The company designs “knock- down” furniture that the customer purchases and then assembles at home. Designs implement functional, utilitarian, and space-saving features, with a distinctive Scan- dinavian style. IKEA Group sales for the fiscal year 2006 totaled 17.3 billion euros, mak- ing IKEA the largest furniture retailer in the world. Its stores, usually located in major cities, are mammoth, warehouse-style outlets, with each stocking approxi- mately 9,500 items, including everything for the home—from sofas to plants to kitchen utensils. IKEA is now owned by a Dutch-registered foundation controlled by the Kam- prad family. Its corporate offices are in the Netherlands, Sweden, and Belgium. 11 312 1. The role of strategy in international business 2. The integration-responsiveness framework 3. Distinct strategies emerging from the integration- responsiveness framework 4. Organizational structure 5. Alternative organizational arrangements for international operations 6. Building the global firm 7. Putting organizational change in motion CAVUMC11_312-343hr 10/15/07 11:26 AM Page 312 Product development, purchasing, and warehousing are concentrated in Sweden. Headquarters designs and develops IKEA’s global product line and branding, often in close collaboration with external suppliers. Approximately 30 percent of the mer- chandise is made in Asia, and two-thirds in Europe. A few items are sourced in North America to address the specific needs of that market, but 90 percent of IKEA’s product line is identical worldwide. Managers at IKEA stores feed market research back to headquarters in Sweden on sales and customer preferences. IKEA targets people all over the world, with a focus on families with limited income and limited living space. This global segment is characterized by liberal- minded, well-educated, white-collar people—including college students—who care little about status and view foreign products positively. Targeting a global customer segment allows IKEA to offer standardized products at uniform prices, a strategy that minimizes the costs of international operations. IKEA seeks scale economies by consolidating worldwide design, purchasing, and manufacturing. It distinguishes itself from conventional furniture makers that s ...
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