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Ikea of GREECE

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Ikea of GREECE

The number of IKEA stores has been growing steadily globally over the seven years.

According to Statista Research Department (2021a), there were 345 IKEA stores in the world

in 2013. The number grew to 361 in 2014, 375 in 2015, 389 in 2016, 403 in 2017, 422 in

2018, 433 in 2019, and 445 in 2020. In 2020 alone, IKEA accrued 39.6 billion euros as

revenue (Statista Research Department, 2021a). The stores are distributed in various parts of

the world. IKEA was first established in Sweden in 1943 by Ingvar Kamprad (Forbes Media

LLC., 2021). The company, headquartered in Delft, currently has about 208,000 employees

(Forbes Media LLC., 2021). In Greece, IKEA is one of the biggest stores for a wide range of

products. Particularly, Greece has five IKEA stores: Athens, Thessaloniki, Athens-Aigaleo,

Thessaly, and Ioannina. Currently, IKEA dominates about 14% share of the market. It intends

to establish more stores and ordering points to increase its share of the market. Quality

decisions are vital in ensuring this positive change. In this regard, it is important to explore

Greece's political and economic forces, Greece's cultural and legal forces, an overview of the

retail industry, IKEA'S mission, vision, and competitive advantage, IKEA'S strengths and

weaknesses, is the current marketing, and international strategy, and its main competitors in

Greece.

Greece has a relatively favorable political environment for business due to minimal

political forces. Greece is a democratic republic. The president is the head of state, while the

prime minister in this country is the head of government. It has a multiparty system that seeks

to ensure that the ideas of all people are considered in governance (Tsiapa, 2021). Markedly,

the Hellenic Parliament in Greece and its government share legislative power. A democratic

state of governance is likely to create a suitable social environment, integrate communities,

and modernize the economy. All these are suitable for the high performance of business

entities (Tsiapa, 2021). Besides, Greece is a capitalist economy. Its public sector accounts for
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40% of its GDP. It implies that the public has more power to control the economy of the

country. If the business meets the need of the people, it is likely to perform so well.

Therefore, it is apparent that both the political and economic environment is suitable for

business.

Besides the political and economic forces, Greece has favorable cultural and legal

forces ideal for business. Concerning the cultural forces, Greece people love visitors and

trying new things. Hence, it is easier for society to embrace new and foreign businesses. It is

a positive force that can boost the performance of retail chain stores such as IKEA. On the

other hand, the country has less stringent laws on business establishment, particularly internal

businesses. Hence, it is easier for businesses such as IKEA to expand and grow in the

country. All in all, Greece has favorable cultural and legal forces that can significantly boost

trade and business.

The retail industry is steadily growing in Greece. The trend is attributed to the

increasing human population, leading to an elevated demand for essential products such as

clothing, food, personal care products, consumer electronics, and fuel (Statista Research

Department, 2021b). Since the population is ever-increasing, the demand for these products

continues increasing. As a result, more retail stores are continually being established to meet

the overall demand for the products. Hence, the retail industry is ever-growing, and the trend

is expected to continue in the future.

IKEA company has a distinct mission and vision, which it aims to achieve in society.

According to IKEA, "Our business idea supports this vision by offering a wide range of well-

designed, functional home furnishing products at prices so low that as many people as

possible will be able to afford them." Presumably, this is the mission of the company since it

is not well specified. On the other hand, its vision is to "To create better everyday life for the

many people." In this case, the company aims to achieve this by providing all the products
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people need (Yurt & Deniz, 2021). In this case, it aims to meet their needs and improve their

quality of living. The competitive advantage that the company has is cost-effectiveness. In

this case, its prices are lower than those offered by its competitors. As a result, many people

in Greece prefer buying from the IKEA stores to other retail outlets.

IKEA Stores in Greece has both strengths and weaknesses. Concerning their strength,

IKEA enjoys an extensive brand reputation and presence on the market. In this case, many

people in Greece know it and would first think of it when they want to buy any products they

need (Yurt & Deniz, 2021). Besides, the company has a diversified product portfolio. In other

words, it sells many products ranging from clothing, electronics, sports equipment, drugs, and

foods. On the other hand, it has some weaknesses. The decreasing quality of products being

sold by the company is a significant weakness. In this case, many customers are forced to

turn to other retail sellers for high-quality products. As a result, the IKEA company is losing

customers (Yurt & Deniz, 2021). Also, Negative publicity is another weakness of the

company. It is mainly to the low-quality products that the company sells. In this particular

case, customers shun buying from the company.

However, IKEA company uses social media platforms for marketing. For instance, it

has an active Facebook page. In this case, the company can interact with both local and

international buyers. It can post information about the availability of certain products, their

prices, and discounts. It also responds to the question of customers via its medial social

platforms. Besides reaching many people, who now use social media platforms, the company

can maintain a robust relationship with both existing and prospective customers (Appel et al.,

2020). Hence, the company uses this strategy to leverage its performance in the economy.

However, IKEA faces stiff competitors from other similar firms in Greece. First, the

company faces stiff competition from Sklavenitis Group that has many sores in Greece.

Retail sells similar products as those sold by IKEA, such as clothing and foodstuffs.
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Secondly, the company faces stiff competition from Vasilopoulos, one of the biggest retails

in Greece. Many locals love it since it offers extra services such as a free home delivery

service. Other competitors include Lidl and Sklavenitis.

In conclusion, IKEA is one of the biggest stores for a wide range of products. IKEA

has five stores in Greece and dominates about 14% share of the market. Markedly, Greece

has a democratic republic, and the public controls a significant portion of its GDP. Besides,

Greece has a culture of welcoming visitors and embracing new ideas and products. Also, it

has a less stringent legal requirement regarding the establishment of businesses. Hence,

Greece's political, economic, cultural, and legal forces are pretty conducive for business.

Markedly, the retail industry is growing, and the trend is likely to continue in the future.

Besides having a distinct mission and vision, cost-effectiveness is IKEA's significant

competitive advantage. IKEA enjoys an extensive brand reputation, presence on the market

and has a diversified product portfolio. Besides, the decreasing quality of products and

negative publicity are its weaknesses. Also, the company uses a social media marketing

strategy.
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References

Appel, G., Grewal, L., Hadi, R., & Stephen, A. T. (2020). The future of social media in

marketing. Journal of the Academy of Marketing Science, 48(1), 79-95. doi:

10.1007/s11747-019-00695-1

Forbes Media LLC. (2021). IKEA. Retrieved from https://www.forbes.com/companies/ikea/?

sh=6e08e0602ad0

Statista Research Department (2021)a. IKEA's number of stores worldwide from 2013 to

2020. Retrieved from https://www.statista.com/statistics/1060053/number-of-ikea-

stores-worldwide/

Statista Research Department (2021)b. Number of retail chains in Greece in 2021, by sector.

Retrieved from https://www.statista.com/statistics/642362/retail-chains-number-by-

sector-greece/

Tsiapa, M. (2021). Performance of large firms in Greece during the unstable period of 2011–

2016: lessons from the weak parts of Europe. European Journal of Management and

Business Economics. doi: 10.1108/EJMBE-06-2019-0109

Yurt, C., & Deniz, D. (2021). Product-based and knowledge-based sustainable living

practices: The case of IKEA. Sustinere: Journal of Environment and

Sustainability, 5(2), 133-145. doi: 10.22515/sustinere.jes.v5i2.173