What Are Ikea's Competitive Priorities?

What are IKEA's competitive priorities?

Great design. High affordability. Push strong brand equity. Good quality for the price.

There's a deliberate push to make an item incredibly affordable. So while this does make the products sold more affordable, IKEA is not looking to push itself as the next Wal-mart. Cheap is a mindset IKEA goes to great lengths to have customers avoid conjuring up. Running on the coattails of this, is the notion that the quality of the items themselves are not greatly compromised in the process. The designs cater to a marketplace of people who want to broadcast themselves as up-to-date but not wasteful in their spending.

Describe IKEA's process for developing a new product.

They start by picking a price, or more specifically, a price tier or price point. This immediately informs the product development based off what is actually technically possible within these constraints. Materials, colors, and the theoretical design itself, all of it has to work concurrently to meet the price. Suppliers and purchasing are then sourced to not only possibly modify the design, but also see how best to carry the manufactured piece through the shipping storing and final delivery. When the price and manufacturer are locked in, IKEA uses internal competition to select the designer and design. The chosen designer uses the mantra of maximum functionality at minimum cost to shape their work. Also, distribution and logistics are given heavy priority. IKEA has a goal of shipping as efficiently with as little used space as possible. Even when reaching their destination, taking up as little space in a warehouse is ever the priority. Finally, you need to sell the products. The stores themselves are set up to take a person through laid out designs that help demonstrate the lifestyle IKEA is pushing to it's customers, which is the simple concept of "why buy an inexpensive ugly pitcher when you can get a nicely designed one for the same price?

What are additional features of the IKEA concept (beyond their design process) that contribute to creating exceptional value for the consumer?

Easily, shipping is one of the biggest contributing factors to lower prices. (Although you could argue this also sometimes influences the design itself.) By designing items that can ship 'flat', by building its distribution centers near ports, railways, and highways, IKEA has the ability to ship products with great efficiency. They are able to ship the maximum amount of products within a certain amount of space, at the right time to the right stores keeping their prices 20 the 30 percent lower than their competition. There's also the holding value of what you buy. In this respect, I think IKEA shares some similarities with Apple. There's a strong loyalty that goes along