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Capell (2006)Management > Global Marketing Management > Lectures > Independent Research > Capell
Capell (2006) - Ikea in JapanThe company failed in Japan before, but this time thinks it can succeed. After visiting over 100 Japanese homes, the company has redesigned its spaces and furniture to suit Japanese homes and will have different spaces aimed at different demographics. Tall dining tables and chairs that were popular in Europe, just would not fit into a Japanese home To market itself, the company has transformed a boulevard in Tokyo’s trendy shopping district, Aoyama, into an open air museum to show off its goods. The firm intends on getting a sizable portion of the $42m home furnishings market in Japan. Its competitors include: Muji and Nitori. Ikea has moved the manufacture of one third of its 10,000 items to Asia, which will cut manufacturing and transportation costs to Japan. The firm then sends the furniture to Kuwala Lumpur Shanghai in China before sending it to Japan, which overcomes stock delays and cuts further costs. The Japanese are used to excellent customer service, so Ikea will offer delivery and assembly of furniture for an extra charge. The market has shifted to one where the Japanese are more willing than they were to build their own furniture More than a decade of deflation means the Japanese cannot afford too much, but Ikea can offer a full fitting of a living room, including a sofa, television stand and tables for $700
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