Although it is a cost leader, IKEA also offers some differentiated features that appeal to its target customers, including its unique furniture designs, in-store playrooms for children, wheelchairs for customer use, and extended hours.TrueFalse

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Answer:

The correct answer is True.

Explanation:

Assemble and transport the furniture to save money, that is the simplified “value proposition” of Ikea. A business model that has been extended in the furniture sector sweeping the competition in dozens of countries. The main reason, one of the keys to traditional marketing: invest more in improving the product than in promoting it. Ikea, the Swedish company (whose national colors appear on the logo) of furniture founded by Ingvar Kamprad, who recently left his board of directors at 87, has achieved worldwide success by doing effective marketing based on:

  • Product design: one of the keys to marketing is to invest in a good product. Because in this way the advertising and promotion spending will be much lower, when using the word of mouth of satisfied customers. In the case of Ikea, many of its furniture is removable, so it is stored and transported in standardized packaging. This not only facilitates the transport by the client, but also represents a significant saving of storage and logistics costs for Ikea. In addition all the furniture comes with instructions and tools to facilitate its assembly. Ikea gets to manufacture annually a whopping 50 million Allen keys.
  • Corporate Social Responsibility: Although Ikea specializes in a medium - low price product, it is not why it uses other brands to save costs through strategies such as child recruitment in developing countries. Which has a positive effect on your brand, unlike the scandals of other multinational companies.
  • Merchandising: or marketing actions to increase profitability at the point of sale. Ikea is an expert in generating complementary income to its main furniture sales business. The restaurants of Ikea are not only a great source of income but also make customers continue shopping after recovering energy with a hot dog. During the path that goes through the store, more typical of a maze and that makes it impossible to leave without buying anything, there are numerous points to take bags where to store the products. So buyers always have their hands free to buy more.
  • Dream marketing: that is, sell using consumer dreams. Ikea reproduces spaces and sensations in his shop, such as through the decoration of royal rooms. The interior design reaches such detail that it promotes the purchase of related products, generating cross sales.
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