IKEA: how and how much it changes, from e-commerce to a service community

In brief
From 2018 Ikea will experiment with selling its products on external e-commerce websites. Acquisition of a start-up for the provision of services is finalised.

According to an article published yesterday by the Financial Times, from 2018 Ikea will begin experimenting with sales models involving selling its furniture products on international e-commerce platforms. Rumours identify Amazon and Alibaba as partners in the new strategic alliance of the Swedish low-cost furnishing giant. It will be the first time that Ikea (considered to be the 25th most important brand in the world) offers goods to consumers not only as a direct and exclusive supplier, but through third parties. The importance of this decision in the words of their manager:

It is the biggest change in the relationship between consumers and Ikea since its inception … So far we have designed the Ikea experience to work in stores, we will quickly learn how to transfer it to the online world as well. We want to learn and understand what it could mean for Ikea to be in this different environment and how to keep our identity on a third party platform”. The company plans to quadruple online sales by 2020, bringing them to $ 5 billion, 10% of revenue Torbjörn Lööf, CEO of Inter Ikea

The decision is lucrative, but not surprising. An increasing number of consumers, especially the younger ones, have less and less time available for prolonged visits to the huge retail outlets that have made the brand famous. The inevitability of integrating a digital approach into the classic display of furniture and products has been highlighted in two other instances.

The first is the introduction of augmented reality based services in stores, making it possible to simulate the layout of the furniture to be purchased inside the customers’ homes. The second is the recent acquisition of TaskRabbit, a California based start-up that connects Ikea customers with a network of self-employed workers for furniture assembly and more: they also offer cleaning, maintenance and removal services. The innovation plan also includes new formats for physical stores: smaller and sometimes temporary retail outlets including specialised pop-up stores (there already is an Ikea pop-up store in Piazza San Silvestro in Rome, the first in Italy dedicated entirely to the world of cooking).