It's only a reduction of 6.993%, but it's better than nothing

Lingonberry Fruit Spread display at IKEA

Ligonberry Spread "New lower price" sign

Lingonberry Fruit Spread jar

Price reduction on the shelf tag

Sunday afternoon I was at IKEA. (More wooden hangers for my kid's closet.) I saw this sign in the Swedish Marketplace section.

A price reduction, not a huge one, but a price reduction nevertheless. Given the recent new about inflation, any price reduction is worth shouting about. And in addition to the price reduction, the product had a pretty prime spot and there was lots of stock on the floor.

But the price reduction didn't change my buying behaviour. (Already had a full jar at home. Didn't need another one just yet.)

 

How does IKEA spend the other 40%?

Advertisement for IKEA, Granville SkyTrain station, Vancouver, BC

Advertisement for IKEA, Granville SkyTrain station, Vancouver, BC (Detail)

Advertisement for IKEA, Granville SkyTrain station, Vancouver, BC

Advertisement for IKEA, Granville SkyTrain station, Vancouver, BC

Advertisement for IKEA, Granville SkyTrain station, Vancouver, BC

Many years ago I remember reading that 60% of IKEA's promotional budget went to the cost of producing and distributing the annual catalogue.

Some of the remaining budget goes to to television commercials such as the great Book Book spot from IKEA Singapore.

These transit advertisements are unusual as they are expensive, large format advertisements for low-cost housewares. Following the classic "features and benefits" format, that are eye-catching and cleverly art directed.

Does anyone still collect bugs?

IKEA advertisement, "The Textile Kingdom", transit shelter, Vancouver, BC

IKEA advertisement, "The Textile Kingdom", transit shelter, Vancouver, BC (Detail)

These used to one of the mainstays in museums, large boards with insects pinned to to them.  We would see the dead butterfly in all of its colourful glory.

Despite the fact that this form of insect collection seems to have gone out of favour, there are probably enough baby boomers around that recognize the principle. Of course the key question is are there enough younger consumers around who will get the joke? Or will they see this as an invitation to animal cruelty?

We're lying to ourselves (And happy doing it.)

Sign at IKEA, Richmond, BC

It says in big letters "Frozen Yogurt", yet everyone who ordered a cone called it "Ice Cream". In Canada "Ice Cream" must contain 10% butter fat. "Frozen Yogurt" has no such requirement and usually contains no butter fat at all.

But consumers are creatures of habit. Much to the chagrin of the dairy farmers we say "pass the butter" even when there is only margarine on the table. And for most people any frozen treat in a cone as "Ice Cream".

I wonder if the dairy farmers will try to crack down on the terminology that consumers use? A pointless exercise at best.

Making their lives a bit easier (Or never underestimate the ability of lazy people to mess things up.)

Shopping cart drop-off location, IKEA, Richmond, BC

Shopping cart drop-off location, IKEA, Richmond, BC (Detail)

Shopping cart drop-off location, IKEA, Richmond, BC (Detail)

The IKEA store in Richmond, BC offers two designs of shopping carts for customers. A grocery store-style cart designed for housewares etc. with a large basket and small rack underneath and a larger chart with a big flat platform designed to carry large flat boxes.

The two styles of IKEA shopping carts in use
(Source: http://static1.1.sqspcdn.com/static/f/742691/19210280/1341956088420/Ikea1.JPG?token=Nqcip0sSSL6ATQemewizEOYWzb0%3D)

But the two cart styles don't "play nicely together". If customers don't put away the carts by style, i.e. they alternate the basket and platform styles, the storage is very inefficient.

Short of redesigning the two cart styles so that they will nest together, this seems to be the best solution. The design of this cart drop-off area makes it impossible for customers to put the carts in the wrong place. Clever and simple.

How little do we know about business in China? (Or the rest of the world?)

IKEA logo

IKEA recently announced the sales for the year ending August 31st. Among with the somewhat unexpected news, sales up by 3.6%, were a few hidden gems.

Of IKEA 10 biggest stores, eight (8) are in China. IKEA only has 16 stores in China, so the average size must be massive. And were are these stores? A few are in cities that most westerners have heard of; three in Shanghai and two in Beijing, but many are in places that are far less likely to be on the tip of the average North American's tongue.

How many people have heard of Chengdu, Dailian, Ningbo, or Wuxi?  

Many North American business people probably have a similar level of ignorance about the major cities in India, or the fact that of the 10 largest malls in the world two are in China, two are in Iran, three in Malaysia, and two are in the Philippines. Canada's West Edmonton Mall sneaks in at number 14 and the United States arrives on the list at number 20 with King of Prussia. (Source: http://en.wikipedia.org/wiki/List_of_largest_shopping_malls_in_the_world)

Doctor Who merges with IKEA

Dalek action figuires (Source: http://merchandise.thedoctorwhosite.co.uk/dalek-paradigm-action-figures/)

When I was a kid Doctor Who was played by Jon Pertwee and the show was in black and white. The costumes were great, but the sets looked as if they were made with cardboard, chewing gum, and piano wire.

But the in the new version of Doctor Who the Daleks are in colour. When I first saw the coloured version of the Daleks I immediately thought that IKEA had taken over the design and production of the Daleks. And Dalek even sounds like an IKEA product name.

Just goes to show how embedded IKEA is in modern commerce and culture.

Are the IKEA catalogue's best days behind it?

2013 IKEA catalogue

Today the IKEA catalogue was delivered in my mail box. I brought mine home, but four other residents put theirs straight into the recycling bin by the mail boxes.

So, either IKEA has made a mistake and is distributing to the catalogue to postal codes that include people who have no interest in the store, or lots of people will be using IKEA's iPad app.

But, regardless, I'd say that the days are numbered for the paper version of the catalogue. (After over 35 years, Mountain Equipment Co-op published its last paper catalogue in the spring of 2012.) I can't see IKEA still producing a paper catalogue in two or three years.

A survey that suits the customers



IKEA Smaland Survey

The last time I was at IKEA with my daughter she went the Smaland play area. She had a great time.

I noticed this survey, "Is Smaland Fun?". I think that this survey really suits the audience very well. Most of the children in the play area are three to eight years old. The survey questions offer three response choices.  A happy face, a neutral face and a sad face.

Given that many of the customers will not be able to read, the visual cues to experience are probably the best option to translate the children's opinions into a scale that management can use.

When designing surveys for adults, most marketers regularly use scales with five options. It is good to see that IKEA has recognized the design they need to get the best response from the children.

A campaign that lives up to its concept

IKEA poster in the City Centre Skytrain Station, Vancouver



The IKEA promo team in downtown Vancouver

I saw these guys, and the members of the team were all male, in downtown Vancouver on Monday, April 23rd. In Vancouver one of the most popular places to market anything is on the corner of Granville and Georgia. Right outside a busy skytrain station. outside the biggest downtown shopping centre and right next to the two flagship department store locations, there is a ton of foot traffic.In addition to stunts like this, it is also a very popular place for product launches (Fiat 500) and product sampling.

On April 25th, IKEA opened a new store in Richmond. Part of the campaign was "Everyone is a coupon" The start of the campaign was the posters in the Skytrain stations and on bus shelters. This was follow up by the walking coupons.

I think that this a great connection to the poster campaign. They certainly got a lot of attention from passers by and lots of people took their photos.

But did i go to the store opening to use myself as a couple and get a great deal? What are you, nuts? Go to the new IKEA on opening day? It will be a mad house. Is there any discount in the world that is worth that chaos and mayhem? Well, for lots of people obviously, but I just could not face the ordeal. I'll check it out in a coupe of weeks, when things settle down.

I've even worked out a route to take my daughter there by bicycle that avoids all of the main streets. She wants to go for a hot dog and ice cream. And who am I to resist the entreaties of a four-year old?.