DISCUSSION QUESTIONS
Question # 1
Identify and discuss the opportunities and challenges of IKEA’s operations in China. Discuss how the company should overcome these challenges.
Question # 2
Identify and discuss the opportunities and challenges of IKEA’s operations in Japan. Discuss how the company should overcome these challenges.
Question # 3
Discuss whether or not IKEA has really implemented the concept of “Glocalisation” (think globally and act locally) in designing its marketing strategies in China and Japan. To what extent have these marketing mixes been adapted to the needs of these two markets?
Question # 4
Critically discuss the franchising strategy Ikea’s used to expand into foreign markets to explain whether or not the company has really used franchising. Why Ikea has not Merger and Acquisition to expand its markets?
CASE STUDY # 4
IKEA’S GLOBAL MARKET EXPANSION
In September 2009, Mikael Ohlsson, who took over as chief executive of IKEA Group pointed at a bright-red “Ektorp” sofa and said “We hate waste,” as Ikea’s designers found a way to pack the popular three-seater more compactly in order to increase by 50% the amount of sofa they could fit into a given space. As a result, €100 ($135) was saved from the market price and significantly reduced the carbon-dioxide emissions from transporting this sofa (The Economist, 2011).
Thrift is the core of IKEA’s corporate culture. Mr. Ohlsson traces it back to the company’s origins in Smaland, a poor region in southern Sweden ever since Ingvar Kamprad founded IKEA in 1943; the company has tried to allow “people with limited means to furnish their houses like rich people”. The name IKEA is formed from the founder’s initials I. K. (Ingvar Kamprad) plus the first letters of Elmtaryd (E) and Agunnaryd (A), the farm and village where he grew up.
