IKEA

IKEA



Question 1:

Discussion

IKEA is a second largest furniture business in U.K and the current proposition of this business is to make furniture available to everyone. The concept lies here is “the offering of identical product lines at identical prices through identical distribution systems, supported by identical promotional programs in several different countries.

The definition stress, in accordance with much of the literature the four P classifications. Standardization and adaptation thus refers to how and if marketing activities referring to product, price, place and promotion are adapted (or not) across countries in which a certain company operate. One of the more known advocates of standardisation of strategies, it is been argued:

“The modern global corporation contrasts powerfully with the aging multinational corporation. Instead of adapting to superficial and even entrenched differences withering and between nations, it will seek sensibly to force suitably standardized products and practices on the entire globe”

Levitt argues in general, mentioning no products and no markets as exceptions from his vision of the globalisation of markets. It would thus also be the vision for sectors that mix product and service (like retailing) and also for very different markets across the globe. Levitt sees factors like technology and converging consumer demands as driving forces. While influential and debated, the weakness of the Levitt article lies just in the general perspective. It can be argued that from that 'distance' - the very general overview perspective - everything looks the same.

Here it is obvious, though not backed with anything else than examples and anecdotal evidence, that the world is 'spiky' (Florida, 2005), rather than flat (Friedman, 2006): the business landscape is not homogenous but instead heterogeneous making adaptations necessary, at least when the view is international and working in culturally diverse markets. While Levitt and his fellow 'globalists' argue that the world is moving, paced by technology and converging tastes, de Mooij and her fellows argue that yes the world is moving, but some things do not change (Davies, 2001).

While the debate on the appropriateness of standardisation or adaptation of marketing activities have generated a lot of research in other areas there is not much research on this topic in international retail, despite the centrality of this theme in international marketing. We find some discussions of this in specific areas in retailing, for example image research but very little of a more general nature, relating to the overall marketing activities of retailers. Image mainly concerns itself with the effects - from a consumer perspective - of marketing activities, not with the marketing activities as such. Some authors (e.g., Sternums, 2007) discusses global retailers standardised expansion strategies, but on a very general level mentioning mostly private label and formats.

Salmon & Tordjman's (2009) classic article discusses the issue of standardisation for global retailers. The authors' analyses C&A, Benetton/Laura Ashley, IKEA/Conran and Marks & Spencer. IKEA is found to have centralised management but adjusted marketing (in dimensions like assortment, pricing and promotion). Salmon & Tordjman rapport on IKEA is 20 years old, building ...