With a middle class population of over 400 million and purchasing power on the rise, the Indian furniture retail market has been classified by CSIL Milano as one of the 14 largest furniture markets in the world. The Indian furniture market is worth US$8 billion and is growing at 30% compound annual growth rate in the organized sector which represents only 15% of the whole industry. The branded furniture market comprising of residential and commercial furniture, is valued at US$1.3 billion in 2008 and expected to reach US$3.7 billion in 2012. Currently there are only 10,500 furniture importers in the organized sector and they mainly import from Italy, Germany, Spain and Malaysia. Domestic demand is largely satisfied by local production. Nonetheless, …show more content…
It wasn’t until June 2013 that IKEA returned to India with an approved plan to invest 105 billion rupees (today valued at about $1.6 billion) and open 25 stand-alone stores across India. Although they’ve been sourcing materials from India for the past 28 years, IKEA now has to comply with local rules, which have significantly held up the progress of India store operations. As a fully independently owned company, they must ensure that an average of 30 percent of the production value of sold goods should be sourced from within India, and within five years of the initial investment. Also to set up new, big scale industrial suppliers following the IKEA IWAY conditions, their code of conduct when it comes to working conditions, social and environmental responsibility, it all takes …show more content…
Targeting this segment helped IKEA project itself as an aspirational western brand. This is a massive change in strategy, as IKEA is targeting the mass market in other parts of the world. This is a strategy that has worked for their expansion in China. Marketing Strategy In most markets, the company uses its product catalogue as a major marketing tool. But since IKEA is new in Indian market it needs to build its brand first. This requires excessive branding in initial stage so that people can get familiar with brand. This can be done through media, newspaper, TV advertisements, billboards. Also a lot of online advertisements through social media as they did in case of China. In China the company is using Chinese social media and micro-blogging website Weibo to target the urban youth. Store location IKEA also need to adjusted its store location strategy. In Europe and the US, where most customers use personal vehicles, IKEA stores are usually located in the suburbs. In China, however, most customers use public transportation. So the company set up its outlets on the outskirts of cities which are connected by rail and metro networks. Similarly, in urban cities they may start their stores in malls that attracts large number of people
MARKETING PRINCIPLES Assignment On: Explain the concept “product/market expansion grid” (Ansoff matrix). Using the growth strategies based on this concept, suggest the initiatives of how Aldi can grow their business in Australia. Substantiate your argument.
The activity of LVMH is mainly focused in luxury industry and its spectrum of products is divided into five generic fields: • Wines & Spirits • Fashion & Leather Goods • Perfumes & Cosmetics • Watches & Jewellery • Selective retailing According to the financial report of LVMH as of 2013, below are the revenues generated across the above mentioned fields. It can be observed that the Fashion and leather goods have consistently generated the maximum revenue for LVMH accounting to over 33%. Porters Five Forces Framework Fashion and leather goods have generated the most revenue for LVMH.
It is true that the United States is the world largest economy based on GDP. It is famous for numerous huge brands in the World. For instance, in the field of technology and social networking, American Brands such as Apple, Microsoft, Google, Facebook, etc. always take the lead in this market. In terms of food, we can not deny the succeed of McDonald or Duckin’ Donuts. And in the coffee markets, there is a firm which changed the way Americans and people around the world view and consume coffee - Starbucks.
Nordstrom has central business districts that are chosen as other stores located within real estate, which attracts the same target market. Nordstrom’s inventory is meant to have more urban/prosperous consumer in mind. Nordstrom’s CBD locations serve as ports for public transportation, and pedestrian traffic. With Nordstrom being in the center of downtown, means being close to very affluent residents who are less price sensitive in their shopping likelihood.
These suppliers are concentrated in Jakarta and can be purchased from for just-in-time procurement. The number of suppliers of this input is high as these materials can be procured from foreign suppliers as well. The cost of switching to another supplier is low and therefore, suppliers of this degree have little bargaining power. However, businesses in the mattress industry compete on technological superiority.
Global strategy is an international strategy that implements by a company which they doing their business in different countries. Internationalization is a process for IKEA expand its business and it was quite important because through the internationalization process, IKEA was able to gain a broader area of marketplace to sales their products, which will lead to profit and revenue increased and new market places existed mean new opportunity for IKEA to improve their product in order to meet the customers’ needs. The first reason that IKEA should go to international level is because the Swedish market is small and no enough for IKEA to expand itself. This is important for IKEA because the small market mean low opportunity, lower profit and
Differentiation Strategy: - It includes developing new products & services which satisfies customer needs, they offer much more values than their competitors. They differentiated the segment according to the customers. They provide multiple customer segments which includes moderately priced to premium priced customers for example: 1. Bulgaria resorts & hotels (The Ritz Carlton) - Target segment:-Luxury guest. 2.
IKEA has about 1,220 suppliers in more than 55 countries around the world, providing the bulk of the company’s inventory. Furniture is sourced through an IKEA-owned manufacturer, Swedwood (now termed as IKEA Industry as of September 2013) as well. IKEA Industry is also the world’s largest wooden furniture manufacturer. IKEA targets middle-class customers worldwide. Its largest target market is the members of Generation Y, as they are young adults who will be purchasing furniture for their future or current homes.