IKEA Foundations of Marketing Essays

IKEA Foundations of Marketing Essays IKEA Foundations of Marketing Paper IKEA Foundations of Marketing Paper Essay Topic: IKEA A companys marketing strategy and competitive strategy is important to make sure that your products are marketed correctly, not only for profit maximisation but also to create awareness of your brand name. An effective marketing or competitive strategy makes sure that you are always one step ahead of your competitors. You may be achieving maximum sales at the current moment but an effective strategy would look in to the long-term and plan for the future so that the success is not short lived. IKEA the Swedish furniture retailer has global brand recognition and enjoys great success all over the world as the low cost producer of stylish and functional furniture products. This report highlights IKEAs marketing strategy and how they place themselves against its competitors in order to gain market share and achieve overall success. IKEAs main aim is to be the low cost producer in the market it operates in and therefore has introduced innovative and cost efficient methods of manufacturing products. Components for products are bought from around the world and wastage of raw materials is seen as another invention to make another product. These cost conscious methods are employed at every stage in the production, manufacturing and distribution process so that the products that reach the customer are affordable for as many people as possible. Your partner in better living. We do are part, you do yours. Together we save money (IKEA 2005) is IKEAs market positioning statement. This means that in order to save money the customers are implemented in the IKEA process and thus they have to pick up the furniture and assemble it themselves. This differentiation strategy gives IKEA a competitive advantage and is a marketing tool that sets it apart from its competitors like Argos. IKEA growth strategy is to expand with opening more stores all around the world. However its main competitor Argos is also implementing a similar strategy within the UK market and has taken over IKEA.IKEA must therefore re-establish themselves through short term strategies like promotional offers. However they must try to focus on long term strategies like the IKEA store card which develops a long term relationship with its loyal customers. By focusing on the long term they reduce the risk of losing anymore market share. Overall IKEA is achieving great success with some short-term down falls but there strategies will try to overcome these short coming. However IKEA must focus on trying to provide low cost items of high quality while marketing IKEA as a shopping experience rather than just a furniture store as this differentiate itself from its competitors like Ilva a Danish furniture firm trying to expand in to the UK market. With profits totalling to 14.8 billion euros(IKEA 2005) IKEA can be classed as a global and local success in many countries. However they must become confident as they are target to local and international competition. To overcome this they can use the environmental friendly processes as a marketing tool to attract new customers. They can also try and find new innovative practices of producing and distributing goods in the most cost effective ways to ensure that they remain the producers of high quality and cheap products. Introduction IKEA, a Swedish furniture retailer is known for its cheap prices and high quality products. IKEA is a global success with over 200 stores in countries around the world with profits increasing rapidly (IKEA 2005) . IKEA has effectively implemented a marketing strategy and placed themselves in a position to overcome its competitors. Its marketing and competitive strategy of high quality products at cheaper prices which is embedded in the culture starts at the design process and continues through all manufacturing, production and distribution stages until it is received by the customers so that they can achieve their promise to produce products which are affordable for as many people as possible. The Company IKEA began in the early 1940s, when Ingvar Kamprad the founder of IKEA sold general household products which people demanded. Due to his success he opened up a showroom and began designing his own furniture range which led to innovation and low costs. The real success came when they realised they could flat pack the furniture so transporting goods to IKEA and for the customer would be easier. This differentiation was their marketing tool which made them a household name on global scale. IKEA a Swedish retailer offers a large range of stylishly designed, functional home furnishing products at low prices. This is the single idea at the heart of everything IKEA does, including the way they produce, buy products and the way they sell them in IKEA stores around the world. They produce high quality products at low prices and this is done by cost-efficient and innovative methods. Sales and Profit Trends This graph shows that between 1995 and 2001, IKEA had major success because there is an increase of 6.4 billion in profits. This might due to all the heavy promotion but also because of new stores opening around the world. The profits have increases from 2001 onwards it has not been a very substantial increases compared to 1995 and 2001 but it just shows that between a space of ten years IKEA has achieved great success. The Market Environment IKEA operates on a global level with 231 stores in 33 countries. The top five countries with the most sales are Germany 19%, USA 11%, UK 11%, France 9%, and Sweden 8 %. (IKEA 2005). This shows that IKEA products have an international appeal and are targeted at many markets. The main objective of IKEA is to produce low priced products of high quality. Its products are produced from resources from all around the world which gives them a competitive cost advantage. The large, yet simple retail stores on the outskirts towns makes them easily accessible for customers and distribution. Trying to achieve the lowest costs in production and distribution means that they have incorporated a cost-leadership strategy this has been embedded into the IKEAs culture through efficient processes. IKEA works on the idea pile them high, sell them cheap idea (Marcousà ¯Ã‚ ¿Ã‚ ½ et al 1999 pp164). The profits may initially be low but with high turnover it makes a healthy profit. The reduction in price does not mean that the quality must be compromised. The Five Forces Model This model helps to contrast a competitive environment. As the diagram shows IKEA is working in a competitive environment with large and small furniture retailers trying to gain market share as barriers to entry are very weak. Customers are in a strong position as they have more bargaining power and negotiate for goods which meet customer needs. A wrong move could have a detrimental affect with your competitors moving ahead of you. Competitive Environment IKEAs strategic positioning is unique. Few furniture retailers have engaged in long-term planning or achieved economies of scale as European furniture retailers are smaller than IKEA. Even when companies have joined forces as buying groups, their operations have made it difficult for them to achieve the same degree of co-ordination as IKEA. IKEA offers limited customer assistance but creates opportunities for customers to choose transport and assemble units of furniture which differentiates them from its competitors. Porters Generic Strategies Model Porter identifies three competitive positioning strategies on which the firm can follow (Kotler et al, 2005 pp 504 213). Achieve overall low-cost leadership in the industry The emphasis on efficiency at all levels within the organisation is the central idea to a cost leadership strategy .Costs need to be monitored at all levels to ensure that they gain benefit form economies if scale. A low cost leadership strategy will only work if the products produced are cheaper compared to its competitors. Concentrate on products that are differentiated. A differentiation strategy requires the organisation to offer something which is unique and valued by the customers .The value added by differentiation results in the ability to charge a higher price. This is to cope with added costs of differentiation, leading to higher profit margins. The risk involved with this strategy is that the consumers may perceive the product as a value added the product IKEA supports a cost leadership strategy while adopting a differentiation strategy by adding the customers in the value chain. The customers are source of labour, knowledge and transportation. The customers are told what is required of them, for example customers have the responsibility of picking up the items from the warehouse. The suppliers are seen as customers gaining knowledge form IKEA specialists. This value added process makes sure that IKEA selects suppliers who provide high quality materials at low costs. IKEA effectively employs a cost leadership strategy while focusing on the needs of its target market segment. The Competition IKEA has faced competition from small local furniture retailers, large DIY chains and supermarkets. IKEA has been placed as the fourth on the most popular furniture list in the UK, behind MFI, Argos and DFS. Argos, has come broadened its appeal to a variety of customers through high quality furniture and enjoys a 5.1% market share compared to IKEAs 4.6 %( Business Scotsman 2004). IKEA is also faced with indirect competition with home make-over shows and magazines which indicates unsatisfied customers. Their new Kitchens campaign is another attempt to diversify and satisfy customer needs. Target Market The typical IKEA customer is young, low to middle income family and generally for first time home buyers. They also focus on the mature and childrens market through some of its products. The company targets the customer who is looking for value and are willing to do a little bit of work themselves by transporting the items home and assembling the furniture. PEST-G Analysis PEST-G is used to analyse the business and economic conditions an organisation faces and how it effects businesses decision making. The table shows how each factor affects Ikeas decisions and the way strategies are implemented. Each factor affects IKEA at varying levels Political factors * Legislation affects IKEA on issues such as product liability and product standard * The political scene is stable at the moment so short-term decisions are not affected as much as long term decisions as the political scene may change * New laws are likely to increases especially with more EU countries trading in the free market means regulations are put in place so that there is no unfair trade. * IKEA is also influenced by different political factors in the different countries it trades with. Economical factors * The interest rates are low but the rise in inflation may means that interest rates may increase and this will affect IKEA as they are planning to invest through opening up new stores this therefore means borrowing is going to much more expensive * IKEA locates on out skirts of towns and thus employment rates around the area must be taken in to account. Employment levels for different countries they are wishing to trade with must also be taken in to account. It is an unwise decision to build IKEA stores where unemployment levels are low as you will to need to offer higher wages to poach workers. * The exchange rate will also affect IKEA as they are importing or exporting goods with the international market. * The GDP level is an important factor as it will show prosperous and poor areas and therefore products will have to marketed according to peoples abilities Socio- Cultural factors * These factors will vary from country to country depending on the dominant religion, attitudes on foreign products, the population demographics and the roles of men and women * For example in the UK we have a multi-cultured society this will affect IKEA in the way the products are promoted, the people they recruit and products being offered must meet the needs of the different user. * The increase in lone parent families means that the IKEA shopping experience has to incorporate procedures which are child friendly, for example playrooms for childrens and products directly aimed at young children * The increase in the older generation has affected IKEA and this can be seen in the products they offer as new ranges of products are aimed directly at that target market. Technological factors * Technology is an important factor as more research and development is taking place. They need to find new and innovative ways of producing goods quickly and cheaply. IKEA is constantly faced with not in stock items, an effective just in time approach could resolve this problem * New technologies offer consumers and businesses more innovative products and services such as ordering, booking and buying products through the internet which IKEA could introduce to gain more consumers. * Distribution, transportation and communication, is easier and more effective with the introduction of new technologies like EDI (Electronic data interchange). Communication is more efficient within the departments in IKEA but also with the customers through for example emails, newsletters and multimedia messaging

Interview a parent on their child Essay Example | Topics and Well Written Essays - 1750 words

Interview a parent on their child - Essay Example He is therefore rated as an average student. He is good in sketching and drawing; does not like to attend social events or family reunions with extended family members; he rarely goes out except to school; and he is basically reported to possess good manners, though rarely takes the initiative to help in household chores. He is reported not to be easily angered, nor hot tempered; he rarely fights with his siblings, or with anyone else, for that matter. His mother disclosed that â€Å"as the youngest child, the only challenging event remembered of him was when he broke his left arm from a motorcycle accident – where he rode as a back rider, when his eldest brother took the motorcycle for a spin†. As he apparently learned from that incident, he never attempted to undertake risky activities or endeavors. Overall, the child is described to be secure and happy in his home environment. As stressed, â€Å"the most important function of parents is to give their children a happ y home — not because it will make them more likely to succeed but because everyone has a right to a happy home life† (Kingsbury, 2009, par. 8). Since the atmosphere is most congenial and happy at home, the child apparently prefers staying home than developing social interactions. Parent’s Responses to Child’s Characteristics and Management of Conflicts The parent, a 50 year old female, is physically, mentally, and emotionally stable to address to the child’s unique needs and characteristics. She reportedly graduated with a master’s degree in business and worked before as a manager of a regional bank. Having met several challenges and difficulties due to the health condition of her husband, who allegedly had diabetes with chronic renal problems, she had to resign from her job and find employment working as a freelance writer through online writing cites. One asked how being a single mother affects her ability to manage conflicts; to which she replied that knowing that she is alone, she had to apply effective parenting style that is deemed most effective to the personalities of her children. Doing so would enable them to address and manage the challenges and conflict well. When her son broke his left arm in the abovementioned motorcycle accident, she reported that both she and her husband immediately brought him to the hospital and had him x-rayed. The left arm had to be placed in a cast which allegedly lasted for three months. She noted that she had been a hands-on mother who addressed the different needs of her children; including academic guidance, financial support, emotional and physical assistance, as well as psychological and spiritual through frequent and regular open communication and observance of religious practice. As explicitly the parent stated: â€Å"I love all my children and I make sure that I provide them with unconditional love and holistic support, as needed. Since their father’s death in 201 0, it had been so challenging to support all of them and assuming the roles of provider, mother, housekeeper, writer, guidance counselor, and of course, a confidante, as they would require.† The situation exhibited by the parent-child relationship corroborated Luxton’s (2011 assertion that â€Å"because child rearing involves ensuring the physical, emotional and social development of a child from the total dependency of infancy to the relative

The establishment of America was long and controversial, but the Research Paper

The establishment of America was long and controversial, but the nation thrived in justice and liberty - Research Paper Example It discusses in detail the urge and the constant struggle of the nation to attain liberty and justice extracting ideas and information from the Voice of Freedom by Eric Foner. The majority of the individuals living in the United States were mainly the farmers and Native Americans (Indians). However, during the time of the exploration most of the European nations migrated to America for trade. The war of the independence initially begins when the different colonies that established in the south and North America because of the migration caused cultural diversity. The demands of the diverse group living in America transformed the meaning of freedom. These groups on their own strived to attain justice and fought for their rights. The peasants fought for their lands and rights, gender discriminations and religious freedom. It is evident during the American Revolution that the demands of equality among the people of America were often question. The peasant and slaves in America were recognized as inferior and had lower socio-economic status in the society. The difference between the privilege of the servants and peasants was embarked to be one of the major iss ues due to which the people of America strived for justice and independence. Hence, â€Å"The liberating Indentured Servant (1784)† was enacted that provided status for the slaves and servants in American Society. Eric states, "a group of respectable New Yorkers proposed to liberate the ship of the African slaves that were brought to America" (Foner 104). These free slaves were provided with a respectable and social status in the society so that they can enjoy their freedom to practice their rights. Previously, Virginia did not have a stable family structure because of the strict rules for the servants in the tobacco field. Browne (1644) States that Virginia remained to be a society with the high number of single men, widows and orphans rather than

Terms Modernism and Postmodernism Essay Example | Topics and Well Written Essays - 4250 words

Terms Modernism and Postmodernism - Essay Example The essay "Terms Modernism and Postmodernism" analyzes modernism and postmodernism and focuses on the theory of Post-Colonialism. There is not a single unanimously agreed definition of modernism and different scholars have defined it differently. Despite the absence of any agreed definition of modernism, all of the definitions of modernism talk about the changes in art, literature, business, and even in the daily lives of individuals because of the industrial revolution and formation of the industrial cities. In academic studies, modernism is a philosophical movement or is a particular perspective of looking at the universe and examining the activities of daily life. Modernism is the movement that shakes off all traditional things including religious belief from individuals’ lives and tries to make everything new. The movement encourages experimentation in every field and, therefore, new perspectives emerge. The effect of the modernism is conspicuous in art and literature as w ell. In literature, the writers reject the traditional method of writing smooth narrative fiction and â€Å"stream of consciousness† emerges as the replacement of the old narrative. The emergence of â€Å"abstract art† and â€Å"diversionist paintings† is the results of modernism. The philosophical movement of modernism starts in late nineteenth and early twentieth century. It is â€Å"a set of ideas†. Post-modernism is also a kind of philosophical movement at the development either scientifically or non- scientifically in every walk of life.

The Catcher in the Rye :: essays research papers

The catcher and the rye is about the struggle of a boy to find a point to his life. The author of this masterpiece, J.D. Salinger, gives a flawless performance of the thoughts and feelings of a skeptical teenage boy. Holden Claufield despises the world of phonies he has come to understand. He doesn’t have many friends, and he is failing in all his classes. He has many problems along those lines, and some how, all of his problems can be related to his younger brother’s death. Holden will come to find that life is what you make of it and some times having a family that cares for you, is incredibly important.   Ã‚  Ã‚  Ã‚  Ã‚  Holden is quite the negative type, for whatever reasons. He takes interest in nothing because he can easily find a logical reason why not to. He doesn’t even portray in social collaboration amongst schoolmates, aside from Stradlater and Ackley of course. He obviously does not join sports, plays, and other related activities, most likely because they are all too social. Holdens relationship with Stradlater, a GQ roommate, was more of a pastime activity, rather then a real friendship. Though Holden is a rather negative guy his thought structure is pure, and he is in general a good person with a free mind.   Ã‚  Ã‚  Ã‚  Ã‚  Holdens disappointments all share a common center of rotation. â€Å"people† is the key problem. He doesn’t like how they work, how they pretend to be something they are not. Like an indirect lie that is shouted with out a word being said. It is people that make the worlds a huge and utter disappointment to Holden. He even has a name for such people, he calls them â€Å"phonies†. The reason for the name is quite self-explanatory. The other type of people that disappoint Holden, are those who are with out respect for anything. The type that only care about what is important to themselves. Ones who would write an obscenity where children play, for self-amusement. Holden doesn’t like these types all, but he keeps his thoughts to himself and remains at peace. Though Holdens negativity and disappointment level is great, he is unknowingly in search of happiness. Holdens initial life plan was to settle him self away from society, and if by chance there we people in this sanctuary, he would pretend to be deaf. One true thing that made Holden happy was sharing a moment with his sister, Peobe.

The Health Danger of Energy Drinks

Energy drinks are a kind of refreshments that are advertised as soft drinks that boost energy. The truth is these kinds of drinks are full of many harmful ingredients, such as sugar, stimulants, and other herbal supplements. Energy drinks are targeting high school and college students who may use this kind of drink to keep them awake for a midterm, or even give them a hallucination feeling any other alcoholic beverages will do. Many studies showed the disadvantageous of these drinks, yet this industry has wildfire between underage kids who used it to show their rebellious side through a safe and cheap way. A new study shows that 34% of youth between the ages of eighteen years old and twenty- four years old consume energy drinks regularly (Casiano, 2011), this large number of consumption should raise the question whether the united state should ban selling Energy drinks to underage kids, and treat it like alcoholic beverages? Youth are having a hard time keeping up with all of the school activities, volunteering, schoolwork, and maybe jobs; those people usually relay and learn bad habits that will effect their health in many years to come. Energy drinks can cause many health problems such as overdose, toxication, heart problems, blood pressure, liver problems, and teeth decaying. Joelving (2011)explains how a recent study in New Zealand’s show that the excessive amount of caffeine that is found in energy drinks can cause fast heart rate, insomnia, and anxiety; the study also shows that â€Å"just one energy drink is enough to make most kids experience some side effect, including mild ones like irritability or upset stomach. And there are other ingredients with effects of their own, such as the amino acid taurine, the herbal extracts yohimbine, guarana and ginseng, and often loads of sugar. † There are many types of energy drinks that are accessed easily in markets and gas stations. One of the most common types is Red Bull, in the website of this energy drink it is written that it will increase concentration and reaction speed, and improve vigilance and emotional status. These manufactures will grab young people attention who are in need to increase and improve their concentration, reaction speed, and emotional state; but they fail to acknowledge the side effect of their products, such as being very tired after several hours of â€Å"sugar rush†. An over dosage of Red Bull cause a twenty-eight years old man to have a heart attack (Richards), this incidents is one of many that prove to us that this dangerous products should be banned from super markets and other easily ccessed places for younger generation. Many Young adults choose to be rebellious to prove their social status; many young adults are mixing energy drinks with alcohol. Mixing a depressor like alcohol with a stimulant like caffeine cause the human body to forget the effect of alcohol, and make the youth drink more alcohol to feel the buzz feeling; leading them to consume more alcohol than their usual body limit. In 2010, nine college students were hospitalized after drinking alcoholic energy drink called four loko (Hogan, 2010). Four loko can be found in any gas station for about three dollars,it is commonly called â€Å" blackout in a can† , it can raise your alcoholic blood level to . 3; the legal limit for blood alcohol level is . 08. One can of four loko contain as much alcohol as a six pack of beer laced with several shots of espresso. Casiano, R., & Contributor, C. (2011, February 17). Queens chronicle – Study finds energy drinks bad for youth. TownNews.com . Retrieved February 17, 2011, from http://www.zwire.com/site/news.cfm?newsid=20456245&BRD=2731 Joelving, F. (2011, February 14). As sales soar, experts warn about energy drinks – Yahoo! News. The top news headlines on current events from Yahoo! News. Retrieved February 17, 2011, from http://news.yahoo.com/s/nm/20110214/us_nm/us_energy_drinks_1 Richards, C. (n.d.). Red bull overdose stops man’s heart |. Caffeine Products. Retrieved February 18, 2011, from http://caffeineproducts.com/caffeine-news/red-bull-overdose-stops-mans-heart-3/2008/08/23/ Hogan, R. (2010, October 26). 9 Students Hospitalized After Drinking Four Loko Alcoholic Energy Drink  » Popular Fidelity  » Unusual Stuff. Popular Fidelity. Retrieved February 18, 2011, from http://www.popfi.com/2010/10/26/9-students-hospitalized-after-drinking-four-loko-alcoholic-energy-drink/

Module Mirror Explorations Of The Self - 2514 Words

Module: Mirror Mirror: Explorations of the Self. Q. Of the many varieties of personality theory on offer, do you think any offer distinct advantages over the others, and if so, why? The study of personality, or human nature has been baffling the minds of great scholars for centuries now. It is not the recent development, but has a long history of progress. Some great scholars like Aristotle, Machiavielli, Descartes among a few other philosophers and writers had their interest invested in the workings of human nature. Recent theories developed after the 18th century to a great extent reiterate the theories once set by the early scholars. Therefore, it is no surprise that the study of personality has been underway since the presence of man†¦show more content†¦Primary to the explanation and critiques of the personality theories, it is important for us to clearly define the term ‘Personality’. Personality, has had varied definitions over the years depending on the works or the background of its developer. Simplified, the term refers to the public image of a person. On occasion it is also referred to as having ‘enduring characteristics’ or as stable and predictable (Schultz 2009). There has been little or no agreement between scholars about how this term should be used and what meaning would this term hold. According to Sigmund Freud, personality is something that is largely unconscious, unknown and hidden. Carl Rogers thought of personality or the ‘self’ to be something that is organized, has a consistent pattern of the perception of the ‘I’ or ‘me’ that lies beneath all the experiences the individual incurs. B.F Skinner, a well-known behaviorist, was of the opinion that the term personality, was completely unnecessary to understand the human behavior (Bender 2007). A theory is defined as, â€Å"a set of abstract concepts developed about a group of facts or events in order to explain them† (Engler 2009: 2). Consequently, personality theory is an organized set of thoughts, ideas or system of beliefs that helps explain understand the human nature or human behavior. (Ellis, Abrams and Abrams, 2009). Personality theories have been built on two types of view of the personality, idiographic view and nomothetic view. Idiographic view