ikea’s market segmentation and targeting

Another concept concerned with market segmentation is marketing mix. Customers greatly benefit from the value of the furniture because it is decent quality furniture for a very low price. 1. According to OPPAPERS (2010) and B&Q (2010c), both of them set the prices of their products reasonable and appropriate. Key Competitors Platform / Material / Household Appliance Simplified / Good Taste / Grocery Local / Cheap / Convenient Experience Owned Brand Relationship and Attitude Media & Marketing Activity Usage and Attitude Annual Advertiser of the 2011 Cannes Lions Festival Style: humor, (Guangzhou IKEA, 2010), B&Q fixes most commodities with appropriate prices for the average consumer. They divide their consumers into groups in accordance with types of market segmentation: demographics, psychographics and behavioral. 3. Available: http://www.bbc.com/news/business-19810924. Increased ROI . This permits the company to serve the large middle and low income earning groups as they are able to secure furniture affordably. In conclusion, both IKEA and B&Q are successful furniture sales enterprises. The basic promotional tool of IKEA is its free catalogue with a list of its products. However, like the popular Ikea Hacks generated by its loyal fans, Ikea’s new marketing effort has combined standard reality TV and sitcom themes to create innovative and captivating YouTube videos targeting Millennials. Strickland, T., Gamble, J., Peteraf, M., (2012).Charting a Company’s Direction: Chapter 2, Vision and Mission, McGraw-Hill, Retrieved from http://highered.mcgraw-hill.com/sites/dl/free/0078112729/898107/Chapter02.pdf Race 7. Anthony Reuben. IKEA’s marketing strategy enables the company to be a successful player in the global market, evaluate how the innovation in IKEA’s marketing mix elements are … Copyright © 2003 - 2020 - UKEssays is a trading name of All Answers Ltd, a company registered in England and Wales. (OPPAPERS, 2010) One method IKEA uses is mantissa pricing, fixing the prices with 9s, such as 299, 699 and 799 yuan, giving customers an impression of cheapness. Our academic experts are ready and waiting to assist with any writing project you may have. Criteria Size:The market must be large enough to justify segmenting. Cognitive view of consumers portrays consumers as a thinking problem solver. Market segmentation is classifying consumers into groups according to their characteristics (Hall et al, 2008) and set certain groups as targets. Three main and most valuable marketing strategies include Segmentation Targeting positioning also known as STP. In order to fulfill their social duties, they both have actions in making contribution to the society. The differences in 4Ps between IKEA and B&Q were also discussed in the paper. Besides, they both open stores in areas with large population. 2. To continue their success, Lowe’s must specifically focus on marketing, logistics, and human resource management strategies. According to many surveys, Segmentation, Targeting and positioning (STP) is one of the best considered marketing strategy model of modern days after SWOT. The prices of IKEA’s products are set reasonably. Retrieved from blogs.wellsfargo.com/guidedbyhistory Segmentation, targeting, positioning in the Marketing strategy of IKEA – Demographic , psychographic & geographic segmentation is used by the company to segment the market to cater to the changing market dynamics of home furnishing, Kitchenware & appliances industry. Segmentation Segmentation is the dividing of a populations into groups according to certain characteristics. The sales volume could be better if they can reduce the price to some extent. Both IKEA and B&Q construct their own websites to introduce their commodities and offer consumers with e-shopping service. Precise and Personalised Targeting. In order to use this core competency to gain a competitive advantage, the company has focused on key functional strategies. You can view samples of our professional work here. Lowe’s important R&D investments included the creation of two prototype stores. The prices of B&Q products are a little lower than IKEA’s. Besides, they both have various promotional skills, such as discounting and installation service. Age 3. Ikea employs market segmentation strategy where the products are towards a particular target market. Finally, It will then show how the strategies correlate with the effectiveness of the organization’s overall success. Market segmentation and target marketing both serve as a very useful technique in saving time, money, and efforts engaged in the marketing of the product/services as targeted marketing focuses on targeting the consumers or audience as per different consumer habits. Marital status 5. B&Q’s most frequently used promotional measure is discounting, while IKEA publicizes its products by free catalogue. A retail business develops a strategy to reach their target market and communicate their message in a meaningful way that consumers can relate too. a. The segment of making individuals who are looking for convenient security for their house and family, the message is focused on the expec... (IKEA, 2010 a). Marketing References ... middle of paper ... It was founded by Richard Block and David Quayle in Portswood, Southampton in 1969. IKEA targets consumers who are looking to benefit from the value of the furniture. The target market is the market segment that the business is focusing on for a specific product or marketing campaign. With no market segmentation, it’s like shooting in the dark instead of targeting the ideal customers. In this article, we'll look at the Segmentation, Targeting and Positioning (STP) Model*, an approach that you can use to identify your most valuable market segments, and then sell to them successfully with carefully targeted products and marketing. It treated them as targeted customer group and then design and generates products for this market. VAT Registration No: 842417633. In addition, it has a website for consumers to search the details of their products. On the other hand, one of the differences is their operating modes. Consumers’ choosing, assembling and transporting products by themselves can reduce the price. Gender 2. SmartThings message is turning your home into a Smart House in other to make a living better. (B&Q, 2010 a). Study for free with our range of university lectures! (B&Q, 2010 e). As a “total concept”, product refers to all merchandises and services provided by a business. Accessible:Each segment must be accessible to your team and the segment must be able to receive yo… Besides, it also offers discount to attract consumers. The IKEA Catalogue includes commodities’ details, such as colors, sizes and prices. Income level 4. All rights reserved. 1st Jan 1970 Demographic grouping is based on measurable statistics, such as: 1. ... middle of paper ... IKEA: Target Market and Positioning Strategy. See our earning section to learn more about SWOT and all other business strategies. IKEA appeals to a It is also recommended that the two companies perform routine market research so as to know well of consumers’ feedbacks. Strategies are the process of creating product, pricing, communication, and customer management strategies. In this case, IKEA was transformed from a small mail order company to a popular international furniture retailer. Market segmentation is a process, in which groups of buyers within a market are divided and profiled according to a range of variables, which determine the market characteristics and tendencies. Focus on marketing, logistics, and human resource management strategies their common traits and characteristics such as and... And limited must specifically focus on the basis of their products and locations are similar much time to deal decoration! More beneficial services such as discounting and installation service targeting the ideal customers 's Billy bookcase, side. Consumers into groups based on measurable statistics, such as: 1 greatly benefit from the value of furniture! Age, gender, etc a variety of products, as well as professional designers said industry Cross. Order to use this core competency in helping customers meet their home improvement needs a. 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