IKES BRAND ANALYSIS AND EXTENSION 1

IKES BRAND ANALYSIS AND EXTENSION

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IKES BRAND ANALYSIS AND EXTENSION 2

IKES BRAND ANALYSIS AND EXTENSION

BRAND ANALYSYS

Introduction

Established in Sweden by Mr. Ingvar Kampard, the IKEA company is a furniture-making

company. It has enjoyed an increase in popularity and, subsequently, sales over the years since

its establishment in 1943, enabling it to expand to international markets. It is 2021; it has more

than 400 stores across 50 different countries. Its business model exploits the niche market

segment of DIY (Do It Yourself) enthusiasts by availing them of more than 12000 products that

are ready and easy to assemble. Its market, however, has since expanded to the general public

chiefly due to its design's elegance, ease of assembly, and expansion of its product line.

Currently, IKEA offers furniture as it did in its inception and kitchen appliances, home

accessories, and decorations, among other home product categories. Despite its vast market share

and, presumably, revenue, it is not publicly traded like most of its peers, making it one of the

most massive privately-held companies globally. This paper does a brand analysis of IKEA to

unearth its brand identity and architecture. The article also makes suggestions on possible brand

expansion strategies and campaigns.

Brand Identity

The French professor, Jean-Noel Kapferer, devised a mechanism for analyzing brand identity

referred to as the Kapferer Prism. This technique analyses a brand's internal and external

identities using six pillars, namely, Personality, Culture, Self-image, Physique, Reflection, and

Relationship (Kapferer, 2009). The first three pillars listed above show the internal factors, while

the last three are external ones. Below is a visualization of the Kapferer prism.
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This prism is utilized in the following analysis. The physique pillar concentrates on the brand

materials' and products' physical appearance. Ikea's logo is simple, consisting of only the brand

name 'IKEA' enclosed in an elliptical circle within a rectangle. The logo is visualized below.

The logo is also conspicuous since it uses colors not commonly used in branding, that is, yellow

and blue. Choosing only two colors is in line with good branding practices that emphasize that

branding materials should contain as few colors as possible to make them easily recognizable.
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The two colors also follow the color theory guidelines by being complementary, which makes

their contrast sufficient and not overwhelming to the eye. According to IKEA, the color yellow is

meant to create a positive impression of the brand, while the blue color is intended to bring

attention to the offer (ikea.com). The appearance of IKEA's products also follows the same

philosophy of simplicity and innovation. The company's products have been heaped with praise

from consumers for not being conventional; they are creative and innovative; for instance, IKEA

has furniture that could function as chairs, tables, or both simultaneously. Few other furniture-

making companies measure up to IKEA's product innovation.

IKEA views itself as a traditional company, and this is its self-image. This fact stems from the

founder's deep Swedish traditional roots. The company's name also reflects this, given that it is

an acronym, I, and stands for the founder's first and last name, Ingvar and Kamprad,

respectively; E stands for the farm on which the founder was brought up, Elmtaryd. Lastly, A is

for Agunnaryd, the founder's home village (ikea.com). This proves that the company, like its

name, has deep Swedish traditional roots. Personality is the other pillar highlighted in Kapferer's

prism. This pillar suggests that companies have personalities akin to humans (Kapferer, 2009).

This personality is discovered by how the company communicates with its customers, its

advertisement campaigns' design and color schemes, and the type of people it interacts with, for

instance, through its endorsements. These factors and others come together to form a company's

personality traits. IKEA has fun and responsible personality. Its partnership with celebrities best

exemplifies the fun part. In 2020, IKEA partnered with Solange Knowles, Beyonce's sister and a

pop icon in her own right, to create a product line with her cultural hub Saint Heron (Tate, 2020).

This partnership shows that IKEA is in tune with pop culture trends, thus making it a fun brand.

IKEA is also socially responsible, participating in trending social problems through its
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cooperate-social responsibility strategies. For instance, the company, through Save the Children

foundation, helped prepare more than 35000 welcome backpacks filled with toys to gift to needy

children and planted upwards of a million trees in the United Kingdom (Dudovskiy, 2022). It

also puts massive efforts into creating a conducive environment for its employees in 2015 when

it set a new hourly wage structure that considered an individual employee's needs instead of the

standard hourly rates; it also launched an online learning platform for its employees to up their

skills, additionally, it in 2021 rolled out a common channel for reporting accidents. This effort

reduced accidents by 30% (Dudovskiy, 2022). It also fosters equality through its policies,

making it among the few companies whose management comprises at least 50% women in a

quarter of its stores (Dudovskiy, 2022).

Culture also plays a significant role in brand identity. Culture, in this case, refers to the mode in

which an organization operates; it also incorporates its values and ethos. Usually, a company’s

culture is associated with its country of origin. IKEA’s values and culture mirror the native

Swedish values of equality and individuality. The company exhibits equality in many facets of

its operation, especially in giving opportunities; this fact has been laid bare in the preceding

section under personality; it is one of the few companies with at least 50% women in managerial

positions in one of every four stores. The company is also a member of Stonewall and

Workplace Pride Foundation, an organization created to foster the inclusion of LGBT+ in the

workplace. IKEA also celebrates International Day Against Homophobia, Biphobia, and

Transphobia annually on 17th May. These facts indicate that indeed IKEA has an inclusive

culture (Dudovskiy, 2022).

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People build organizations and companies, and for people, the relationship between the company

and the people involved in it, employees, suppliers, and consumers are vital to a brand’s image.

IKEA has a homely relationship with its consumers. This is because its products mainly target

people with homes and across all economic, social classes, and races. To most customers, IKEA

feels like a crafty uncle, while its employees feel like a caring father since the company takes

good care of them. The last pillar in Kapferer’s prism is reflection. This pillar calls for brands to

reflect the values of the target consumer. IKEA does this by producing simple but elegant

products, which are the qualities most DIY enthusiasts use in products.

Brand Architecture

Brand architecture refers to an organization's strategy to organize its offerings under one

umbrella. IKEA has a complex architecture that encompasses multiple product offerings and

business models. Its target market is segmented on the consumer's life stage, personal values,

lifestyle, and home style. The brand's portfolio may be categorized based on the use of the

products. The company's main product line is not conventional furniture but innovative and out-

of-the-box furniture. IKEA is famed for producing stylish, simple, and creative furniture, which

plays a major role in the company's success. IKEA also produces interior design products such as

decorations and accessories. Besides products, IKEA also provides interior design services

where experts help homeowners to organize their homes according to their style. This shows that

IKEA's offerings architecture may be categorized as physical products or services. Brand

architecture also refers to the managerial and store hierarchies. IKEA, in 2014, had 51 stores in

North America, 222, 23, 14, and 5 stores in Europe, Asia, Russia, and Australia, respectively,

totaling 315 stores in 27 countries with a total sale of 28.7 billion Euros (Atwell, 2022). It has
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almost 150,000 workers and more than a thousand suppliers across 50 countries. It also had close

to three-quarters of a billion store visits and more than one and a half billion web visits in 2014

(Atwell, 2022). Despite being in several continents, most, 59%, of its production occurs in

Europe. It has a mix of centralized and decentralized management systems, with each store

having its management structure and a core management body that covers them all. Below is a

table that shows the company's main management team.

Name Position

Martin Hansson Retail and Expansion

Petra Hesser Human Resources

Jesper Brodin Range and Supply

Steve Howard Sustainability

Peter Agnefjäll President and CEO

Helen Duphorn Cooperate Communications

Leif Hultman IKEA Industry

Alistair Davidson CFO

BRAND EXTENSION

This article suggests rolling out a new product line under the IKEA brand for brand extension.

The suggested product line will offer close-fitting furniture to the customer. This product line

will go by the name “SD” with the slogan “feel at home wherever you go” and is complementary

to the existing product line of IKEA since it already produces furniture. The product name is an

acronym just as IKEA is, it means Sustainable Design while the line’s slogan communicates one
IKES BRAND ANALYSIS AND EXTENSION 8

of IKEA’s values of homeliness. Close-fitting furniture is coined to mean compact furniture; for

instance, if it is a chair, then a person must fit in it precisely. This product is inspired by the

ongoing trend, especially among the younger generations, that has seen an uptake in close-fitting

clothes. It will be a personal style statement piece. Besides that, the furniture will also be made

out of eco-friendly materials that have been sourced in a sustainable manner. The furniture will

be made of discarded cardboard shells and lightweight new material. SD is bound to tap into the

consciousness trend being experienced by being sustainably manufactured. According to

Georgina Gill, sustainability will reshape retail in 2023, with consumers opting for sustainably

produced products due to the increased awareness spearheaded by the UN through its

Sustainability Goals Program (Gill, 2022).

The sustainable approach fits in with IKEA’s responsible personality. As already elaborated,

IKEA puts a lot of effort into sustainability and care for the environment. Therefore, the SD

product line will be another arrow in IKEA’s sustainability quiver. SD’s furniture will also carry

IKEA’s innovative spirit by striving to produce creatively designed and developed furniture. The

products will have to be simple but elegant in design in order to mirror IKEA’s physique. The

flagship product under the line will be colored yellow so as to reflect IKEA’s logo. Although that

would be the flagship product, there still will be other color options for the consumers to choose

the one that best exemplifies their personal style. These many options are an attempt at

inclusivity and equality in line with IKEA’s values as well.

Currently, no major brands are offering close-fitting furniture in the market, thus positioning SD

for success riding off the back of IKEA’s success. Although there are no direct competitors in

the close-fitting furniture niche market, there still is some competition from other players in the
IKES BRAND ANALYSIS AND EXTENSION 9

industry who offer other types of furniture. The main competitor for this product line is foreseen

to be other IKEA product lines. Other competitors include Loft furniture, and Ashley Furniture,

among others. The price point is the main difference between SD’s products and the competitors.

Most of SD’s competitors offer high-end furniture that targets the upper and upper middle class.

SD, however, will produce furniture that goes at a lower price. This lower price will be made

possible since SD’s material will be recycled, thus driving down production costs. These facts

will position SD as a cheaper alternative to existing furniture brands, thus appealing to a wider

range of customers by attracting lower and lower-middle-class people. Below is a table that

summarizes SD’s brand positioning.

Competitors Other IKEA product lines

Loft Furniture

Ashley Furniture

Points of Difference Cheaper, appeals to the lower and lower-

middle class

Compact furniture, will be a personal

Different build material

Points of Parity The materials are environmentally friendly

and recyclable, and the furniture design is

beautiful.

Unique Selling Point Sustainably sourced material.

Compact design
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IMC PLAN

SD's wide target market may not be reached using a single campaign strategy. The target market

may be subdivided into two broad categories: the youth and young adults and the lower and

lower-middle class. To be more efficient, SD shall adopt two strategies for each target market

segment. The first subgroup allows SD to employ the power of social media marketing. How

young people interact is changing with the inception of social media. Currently, more than half

of the world's population is on social media; that figure is even higher among younger people; in

the last year alone, more than 300 million people joined the bandwagon (Schaffer et al., 2022).

This makes social media an efficient tool for marketers to carry out their campaigns, a fact that

businesses are taking note evidenced by the fact that more than 90% of marketers use social

media as part of their marketing arsenal (Schaffer et al., 2022). This, therefore, informs the

decision to use social media to reach young people.

The adverts circulated on social media will mostly be in short video formats. These videos will

have to be funny or, at the very least, not formal and uptight for maximum impact. They have to

be funny since funny videos elicit the most engagement, according to 80% of marketers (Needle,

2022). In the spirit of IKEA, the spirit of forming meaningful relationships, SD will also join

hands with Social Media Influencers who share mutual values to circulate the campaign better.

The social media campaign will run for six months, from the first of January 2023 to the thirtieth

of June. New adverts and short videos will be created twice weekly, and their performance will

be judged individually. This iteration in marketing material is meant to keep the campaign from

getting stale, as the videos are also intended to be entertaining. Certain metrics will be recorded
IKES BRAND ANALYSIS AND EXTENSION 11

at regular intervals to measure the success of this social media campaign; they are the number of

engagement with the ads, which means the number of people who like them, retweet them, share

them and click on them; tools such as Facebook Insights will be used for this. The traffic to the

company’s website will also be monitored to find out how much of it comes from the adverts and

how each advert performs; tools such as Google Analytics will be used for this.

The lower and lower-middle class, the second target market, provides SD with an opportunity to

use sales promotions as a marketing tool. Sales promotion would be an efficient strategy for this

group since they seek bargains given the hard economic times. Besides that, this would be an

efficient strategy since SD is new to the market, and people are yet to form attachments to it.

Consumer trends suggest that consumers become loyal to brands mainly if the products meet

their expectations, consumer satisfaction (Fontanella, 2022). However, they would not be

satisfied with a product if they have not used it yet; as such, it is prudent to use this strategy since

it would allow them to try out the new product. Ultimately, this strategy should foster consumer

loyalty to SD. The message for this campaign shall focus on what appeals to this target group the

most, cost. Therefore, the message would emphasize that SD’s products are cheap, quality, and

thus a bargain. To make the campaign more efficient, it shall employ face-to-face marketing with

traveling sales agents who would market the products at events and festivals. The sales

promotion campaign will run concurrently with the social media one. However, measuring the

success of the sales promotion is more straightforward than the previous one; one has to

calculate the number of sales. Below is a summary of SD’s marketing campaign strategy.

Comm Objective Target Message Media/Format Running Measurement

Tool Time
IKES BRAND ANALYSIS AND EXTENSION 12

Advertising Raise The Get Media: Start The number

Awareness youth cheap Social Media Date: 1st of

on the and and Platforms Jan 2023 engagement

launching young elegant (Instagram with the

of Popup adults furniture YouTube End Date: adverts (the

stores. (25 – 35 without Twitter 30th June number of

years hurting TikTok 2023 people who

Get early old) the trees. Influencers) click on the

adopters to online ad)

walk into Format:

the stores. Short videos. The increase

Brand Posters. in traffic in

Increase Written and the company’s

the promoted website where

company’s posts. the adverts

website will be

traffic by leading the

10% in six potential

months customers to.

Sales Increase The New, Face-to-face Start The number

Promotion Awareness lower Cheaper with marketing Date: of sales.

on SD’s and and and sales 1st Jan

products. lower- Better agents. 2023

IKES BRAND ANALYSIS AND EXTENSION 13

middle quality

Close class furniture Events and End Date:

sales. people. Festivals 30th June

Increase

walk-in

traffic in

SD’s

physical

stores

Both these marketing strategies have been formulated with the opinion that SD’s products fall in

the middle of the top quadrants in the Rossiter-Percy Grid. Furniture is a long-term investment;

therefore, a lot of thinking goes into buying one. These decisions are influenced by logic and

feelings in equal measure. The logic goes into the functionality of the furniture, while the feeling

is that furniture is not only supposed to be practical but also to express a person’s style.

Conclusion

In conclusion, the IKEA brand has grown to international repute mainly because of its values.

Sourcing inspiration from its Swedish roots, the brand has been able to position itself as a

champion for many trending social-cultural issues while at the same time maintaining a high

standard for its products. Its architecture is a mix of centralized and decentralized management

models, with each store having its management team, which is all under the larger management

umbrella. Ultimately, IKEA is a prime example of positive and impactful branding. Although

great, it could be greater should it do an extension of the brand. This paper suggests introducing
IKES BRAND ANALYSIS AND EXTENSION 14

a new product line under the IKEA umbrella named SD. SD will make close-fitting furniture

from recycled cardboard shells. To roll it out, SD will employ two marketing strategies for the

two segments of its target market. To capture the first target market, which is the youth, it shall

use social media advertising and influencers, while to capture the second target market, the lower

and lower-middle class, it shall use sales promotion.

References
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