IKEA - Secrets of customer-centricity

"I think one of the most interesting things about their philosophy is to start out with a price that the consumer will want to pay and figure out a way to make it," said Ken Bernhardt, a marketing professor at Georgia State University in Atlanta. "That is completely backward from the way other companies do it."

The company keeps a zealous focus on cost control, similar to Wal-Mart's practice of squeezing suppliers and Toyota Motor Corp.'s elimination of waste and errors in manufacturing.

The Ikea business philosophy

At Ikea's design headquarters in Sweden, examples abound of the retailer's focus on thrift. Many employees ride their bikes to work, even with snow on the ground. Conference rooms are bare-bones, with self-assembled furniture.

The company has been that way from the start, since Ingvar Kamprad, now 80, founded it 63 years ago. His initials and those of his farm, Elmtaryd, and his county, Agunnaryd, form the acronym for Ikea.

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Comments

[marc]

Price is important, but where Ikea really succeed is their focus upon design. Cheap products don't have to look cheap. They wouldn't be where they are now if all their products were not aesthetically pleasing with focus upon form and function.