Marketing of Ikea Company - Essay Example

Marketing Introduction Business organizations around the world are making untiring efforts tocope up with the competition, in order to survive in this competitive and merit world. In this paper, author will try to discuss one of the most important aspects of success of a business organization, which is the proper creation and management of the marketing factors in a business organization. This study has been done, in order to identify, understand, and analyze different aspects of marketing, which plays a significant and crucial role in the success of an organization. The case study has been considered the IKEA, which has a very good reputation among its competitors due to its unique marketing techniques, which differentiates it from the other companies in the market. In this regard, background information of the IKEA has been discussed, which will allow to consider the company as a customer-oriented company or vice versa. The different operations of the IKEA have been analyzed with relation to it growth in home-furnishing sector of the market. In order to compare its operations and activities, different competitors of the IKEA have been examined and analyzed during the paper. Findings and analysis part has been considered to identify the IKEA’s operations, if they have fallen according to the criteria of the customer-oriented companies. MARKETING MIX In the marketplace, the strategic position of a product is described by the utilization of four Ps, which is referred as the marketing mix. Although some additional Ps has been integrated by some marketers, but the four Ps are the standardized and typical constituents of the marketing mix, which are promotion, place, price, and the product. (Coe, pp. 23-25) Product When a specific volume of units is considered for the mass production of an object or a service on a large scale, it is referred as a product. The hotel industry is one of the typical examples of the abovementioned description of the product. Moreover, motorcar, computer operating systems, etc. are some of the uncommon examples of a mass produced service. Price When a product is produced, the producer requires the payback of expenses that are borne by him/her. In other words, a customer has to pay for the product and the amount is referred as its price. Competition, material costs, market share, and perceived value are some of the factors that determine the price of a product. Place It is very important that a business organization should select a place that may be effective for product purchases by the customers. In other words, place is another very important ‘P’ of the marketing mix. Some of the marketers also refer as the distribution channel, which plays a significant role in the success of a product. Physical stores are the key constituents of the place constituent of the marketing mix. Nowadays, virtual stores are another major method of approaching customers on the internet. Promotion Communication is one of the most imperative and crucial factors that decide the success of a product or service in the market place. In marketing terminology, all the communication techniques that are used by the marketers are known as promotion. Comprehensively, point of sale, word of mouth, public relations, and advertising are the four diverse components of the promotion. In brief, billboards, radio, internet, and television are some of the major platforms that allow the marketers to advertise their products or services. (Stone, pp. 28-29) Nowadays, the concept of promotional product is one of the notable methodologies of promotion through which, marketers are able to attract a targeted audience. However, the abovementioned technique of promotion is a paid-for strategy of marketing a product. On the other hand, press releases, conferences, exhibitions, etc. are some of the non-payable strategies of public relations, which is another major component of the promotion factor of the marketing mix. Lastly, word of mouth is the strategy that is distributed through ordinary people at commonplace. Such promotion can be done with the help of sales staff, satisfied customers, and young marketers, which play an important role in promoting the product or service through a word of mouth. (Dawson, pp. 51-55) In broad terms, effective implementation of the marketing mix should be the first priority and primary responsibility of the marketers. Until now, the paper has described and discussed some of the fundamentals of marketing and marketing mix, which will allow understanding the status of the IKEA company as a marketing-oriented company or not. MARKETING-ORIENTED COMPANY The paper will now discuss some of the major factors of a marketing-oriented company. It is an observation that some organization work under the strategy of sales orientation. In such types of organizations, steps are taken to acquire more and more orders from the consumers, and long-term business relationships are the major considerations of sales-oriented companies. Such companies prefer working on low profits to maintain long-term business associations. On the other hand, some companies are known as marketing-oriented companies. Customers are referred as the kings and rulers of the marketing-oriented companies. Most of the marketing-oriented companies work under the banner of customer is always right. Customers’ preferences, choice, tastes, necessities, wants, etc. are some of the significant factors that are studied by such companies. (Coe, pp. 41-44) In this regard, maintenance of long-term consumer relationship is considered the most important objective of these companies and marketing strategies are employed in such a way that should be according to the needs and requirements of the customers. Unlike sales-oriented companies, needs of customers are given importance by the marketing-oriented companies, rather than the products. In other words, products are fabricated and modified according to customers, rather than the company’s executives. Marketers of the marketing-oriented companies analyze and investigate the marketplace and the consumer behavior to promote their products and services. Some of the major factors that affect and influence the working of a marketing-oriented company are price structure, packaging, features, delivery, etc. Moreover, it is ensured that appropriate channels are selected by the companies that are suitable for the consumers. In other words, consumers enjoy a pivotal position in the working of a marketing-oriented company. Some of the major marketing-oriented companies are Nokia, Pepsi, Nike, etc. Now, the paper will decide whether the IKEA is a customer-oriented company by analyzing different operations of the company. IKEA It is very important to be familiar with the operations and business style of the IKEA, in order to decide whether the company is a customer oriented one or not. In this regard, this section of the paper will discuss some of the different aspects of the IKEA Company, which is one of the world’s largest retailer companies in the home-furnishing industry. An innovative idea of Ingvar Kamprad began the IKEA Concept around the world. In the late 1940s, the furniture business was started by the previously mentioned founder of the IKEA. Annually, more than one hundred and eight million people visited the IKEA stores in different countries of the world during the year 2006. According to the sales turnover of IKEA in the year 2006, approximately 17,658 million Euros came out to be its annual sales worldwide. These sales and turnovers are possible by the determined efforts of more than ten million employees and co-workers of this huge retailer of home furnishing products around the world. (IKEA, 2008) A number of retail outlets have been established for the proper distribution of its products around the world. The United States, Europe, Asia, Canada, and Australia are some of the main locations of IKEA’s retail outlets that it controls and owns globally. Interestingly, Israel, as well as, the Middle East nations are consisting of IKEA’s stores simultaneously, which makes it one of the world’s few store chains to have this type of pluralism and diversity in its distribution and operations. At IKEA, the consumers are usually attracted by the catalogues through effective marketing. However, good service and quality are the main factors that attract the customers back to its stores. It is crucial to keep satisfied consumers along with the line by the correct anticipation of design trends and fashionable styles of the products, as believed by the IKEA. Therefore, leading-edge technology is utilized by the IKEA for better handling and service of its consumers. Many just-in-time concepts are considered by the different logistics manager of the IKEA during their different operations of marketing of their products. In this regard, own distribution network has been developed by the IKEA globally. Retail stores all over the world are insured of timely delivery of the products by proper planning and administrating the control points in the cycle of distribution of these products, which is one of the effective marketing strategies of the IKEA Company. From different studies, it has been found that exclusive own-brand ranges have been created by the IKEA, in order to promote its stylish furniture, which appeals and attract strongly to especially, first-time buyers. In this regard, different branding campaigns have also been run by the IKEA. For instance, Chuck out the chintz was one of its high-profile campaigns that were used to promote its products on the television. Customers who are interested in the interiors were encouraged to revamp and renovate their interiors, and in this process, IKEA’s modern styles of furniture and household items were promoted by their individual brand names. (IKEA, 2008) Moreover, offering of the basic and relatively inexpensive home furnishings is one of the strategies of the IKEA. Self-service, stylish furniture, good quality, and good prices are the part of the IKEA’s brand experiences that are provided by the IKEA’s brand managers to the consumers around the world. IKEA has created a global image of its company’s name among its consumers. Numerous charities have been supported by the IKEA around the world. In addition, over-harvesting of endangered forests has also been done by the IKEA. In this regard, it can be said that IKEA has been able to create a corporate image of its company, and thus, a corporate brand of its products through efficient and successful implementation of the four Ps of the marketing mix in its wide range of products in the marketplace. Good function and stylish design of the home furnishing products was the concept of its founder. However, the idea that is innovative and became the reason of the IKEA Company’s success is their low prices, which are very lower than its competitors that are selling the same products in the marketplace. In this regard, simple cost-cutting solutions are utilized by the IKEA that improved and enhanced the quality, and did not affect the cost of these versatile products. Conclusively, paper has tried to understand and discuss different aspects of the marketing, marketing mix, customer-oriented company, and the factors that allow a company to accelerate its success with the help of its marketing strategies. The paper has also discussed various background information of the IKEA, its marketing strategies, turnover, branding techniques, etc, which has allowed the paper to decide that the IKEA Company is a customer-oriented company, as most of the operating and marketing activities of the company have focused the requirements, needs, and tastes of customers from different and diverse cultures. It is hoped that the paper will be beneficial for the students, teachers, experts, and nonprofessionals in the better understanding of the topic. Works Cited IKEA. The IKEA Company. Retrieved July 18, 2008. www.ikea.com John Coe. The Fundamentals of Business-to-Business Sales & Marketing. McGraw-Hill Professional, 2003. Michael Dawson. The Consumer Trap. University of Illinois Press, 2003. Phil Stone. Make Marketing Work for You. How to Books Limited, 2001. Word Count: 1870 Words Checked by Copyscape.com & Turnitin.com Read More