Ingvar, Kamprad, Elmtaryd and Agunnaryd

EAST,WEST HOME IS BEST CHANGE BEGINS AT HOME!

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Marketing Management

Submitted To: Sir Salman Khan Submitted By: M Mahfooz Ayub Wasim Amjad Talal Shahid Butt Wasim Afzal Khizer Ishaq MBP-11319 MBP-11301 MBP-11302 MBP-11342 MBP-11320

Superior University Lahore Introduction

It is easy to think about the present without considering the future. Consumers want more goods and services to improve their standard of living. The problem is they make choices about goods and services that have long-term consequences for the environment. In our modern world, organizations need to show responsibility. This means that they use resources efficiently, do not harm the environment and consider how what they do affects the ability of future generations to meet their needs. IKEA aims to be a responsible organization. It sells low-price home furnishing products around the world. These include furniture and accessories for kitchens, bedrooms, living rooms, bathrooms and childrens rooms. IKEA now has stores in 36 countries around the world. It has come a long way in its 60 years of business.

Superior University Lahore Vision

The direction for the organization is provided by its vision. This acts as a guide for everybody within and outside the organization about what IKEA wants to achieve. IKEAs vision is To create a better everyday life for the many people. To meet its vision IKEA provides many well-designed, functional products for the home. It prices its products low so that as many people as possible can afford to buy them

Describe what is meant by SWOT analysis.

SWOT analysis is a marketing tool which is used to analyze case studies and serve as diagnostics for individual organizations and governments as well. It is used to identify potential threats and weaknesses that an organization may have and deal with them accordingly using their own strengths and opportunities to counter the effects of any untoward economic situations or meet any challenges

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Subject of SWOT analysis: (define the subject of the analysis here) Strengths Weaknesses

USP's (unique selling points)? Resources, Assets, People? Experience, knowledge, data? Marketing - reach, distribution, awareness? Price, value, quality? Cultural, attitudinal, behavioral?

Gaps in capabilities? Lack of competitive strength? Reputation, presence and reach? Financials? Own known vulnerabilities? Timescales, deadlines and pressures?

Threats

opportunities

Political effects? Legislative effects? Environmental effects? IT developments?

Market developments? Competitors' vulnerabilities? Industry or lifestyle trends?

Difference between External & Internal factor.

1. Internal factors that affect businesses come from within the business itself, without regard to any outside factors like customers and other businesses. External factors would be opposite. Internal factor , these involve (5M's)

Management Manpower machine material and Money.

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2. External factors , these include Macro factor and micro factors. Macro factors are the one that affect the organization indirectly, these are (pestel)

Political enviroment socia-cultural technological and Ecological leagal

While micro factors are those which affect the organization directly it involve

customers competitors suppliers and public

Analyse ways in which IKEA has managed to minimize threats to its business.
IKEA addresses these issues in many ways it manages weaknesses and threats create a positive outcome.

Social trends:
IKEA is building online help to guide customers to a more sustainable life. Here it can focus on home improvement in the solving housing market. It supports customers with tips and ideas on its website to reduce their impact on the environment. This will also save the money. Staff is trained on sustainability, both on what IKEA is doing and how they can take responsibility to become sustainable for themselves.

Market forces:
IKEA is large enough enjoy economics of scale. These lower averages costs in the long run through, for example, better use of technology are employing specialized managers. Economics of scale also give a business competitive edge if cost savings are then

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passed on to customers in the form of lower prices. This puts up high barriers to entry for smaller companies entering the market.

Economics factors:
IKEAs low prices create appeal amongst its customers in through financial times. It is vital to keep price as low as possible. When the retail sector is depressed IKEAs pricing strategy targets consumers with limited financial resources. Its products will also appeal to those with higher budgets through good quality and design. the company must ensure that it is always recognized as having the lowest price on the market in the future. Communication plays an important role here.

Discuss the contribution of SWOT analysis to IKEAs Business growth.

Strengths
Increasing use of renewable materials IKEA improved its overall use from 71% in 2007 to 75% in 2009. 'Smarter' use of raw materials IKEA increased the use of recycled or reclaimed waste products in energy production across all stores from 84% in 2007 to 90% in 2009. Volume commitments IKEA believes in creating long-term partnerships with its suppliers in order to achieve this. By committing to buying large volumes over a number of years IKEA can negotiate lower prices. This also benefits the suppliers because they enjoy the greater security of having guaranteed orders.

Weaknesses The size and scale of its global business. This could make it hard to control standards and quality. Some countries where IKEA products are made do not implement the legislation to control working conditions. This could represent a weak link in IKEA's supply chain, affecting consumer views of IKEA's products. The IWAY code is backed up by training and inspectors visiting factories to make sure that suppliers meet its requirements. The need for low cost products. This needs to be balanced against producing good quality. IKEA also needs to differentiate itself and its products from competitors. IKEA believes there is no compromise between being able to offer good quality products and low prices.

Threats

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Social trends such as the slowdown in first time buyers entering the housing market. This is a core market segment for IKEA products Market forces more competitors entering the low price household and furnishings markets. IKEA needs to reinforce its unique qualities to compete with these Economic factors the recession slows down consumer spending and disposable income reduces.

Opportunities

a growing demand for greener products A growing demand for low priced products. Trends in the current financial climate may result in consumers trading down from more expensive stores Demand for reduced water usage and lower carbon footprints. IKEA has a number of areas of focus to its work with sustainability, each of which it supports in various ways: 1. Solutions for a sustainable life at home IKEA gives online tips and ideas for this. 2. Sustainable use of resources. IKEA aims for zero waste to landfill, wastewater treatment and programmes to reduce its use of water.