The Financial Times has a story about Swedish furniture retailer Ikea, noting that while its roots are in a kind of democratization of style by offering a specific kind of furniture at low cost, it currently is undergoing a kind of transformation.
“It is no secret that Ikea is in experiment mode,” FT writes. “The retailer is looking to capitalise on an emerging millennial market in which employment regulations are lax and income is disposable. Taking advantage of the gig economy’s asset light business model while simultaneously fighting off increasing competition in the flat-pack furniture market, Ikea is evolving to fit the demands of platform consumers. But it may be sacrificing its democratising pedigree in the process.”
The focus these days is on new store formats, such as smaller planning stores and pickup locations … new services, such as furniture rentals … and new customers, such as young people employed in technology jobs where they may be working at home and need functional home office furniture that is relevant to their needs and resonant to how they feel about their lives. And, it acquired a company called TaskRabbbit, described as a company that “uses its online marketplace to connect 60,000 freelance workers, or ‘taskers,’ with people looking to hire someone to do chores like furniture assembly, moving and handyman fixes. In their listings, workers specify their hourly rates.”
“It is no secret that Ikea is in experiment mode,” FT writes. “The retailer is looking to capitalise on an emerging millennial market in which employment regulations are lax and income is disposable. Taking advantage of the gig economy’s asset light business model while simultaneously fighting off increasing competition in the flat-pack furniture market, Ikea is evolving to fit the demands of platform consumers. But it may be sacrificing its democratising pedigree in the process.”
The focus these days is on new store formats, such as smaller planning stores and pickup locations … new services, such as furniture rentals … and new customers, such as young people employed in technology jobs where they may be working at home and need functional home office furniture that is relevant to their needs and resonant to how they feel about their lives. And, it acquired a company called TaskRabbbit, described as a company that “uses its online marketplace to connect 60,000 freelance workers, or ‘taskers,’ with people looking to hire someone to do chores like furniture assembly, moving and handyman fixes. In their listings, workers specify their hourly rates.”
- KC's View:
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The FT story asks a perfectly legitimate question - “how do you compete on quality, product duration and craftsmanship when your market niche is all about being cheap, affordable and disposable?”
This is the challenge for so many retailers … figuring out ways to be true to one’s tradition and roots and essential value proposition while still exploring new avenues of trade and new ways to connect with evolving consumer needs and desires. But it is a challenge they must take up, because to avoid or ignore it is to risk obsolescence.
