IKEA is a global colossus built on contemporary design, low prices and an enthusiasm that few organizations can equal. Perhaps more than any other company in the world, IKEA has become a curator of people’s lifestyles, if not their lives. At a time when consumers face so many choices for everything they buy, IKEA provides a one-stop sanctuary for coolness. It is a trusted safe zone that people can enter and where they can immediately be part of a like-minded cost/design/environmentally sensitive global tribe. 

The IKEA concept has plenty of room to run: the retailer accounts for just 5–10 per cent of the furniture market in most of the countries in which it operates. It is, however, a global phenomenon. This is because IKEA is far more than a furniture merchant. It sells a lifestyle that consumers around the world embrace as a signal they’ve arrived, have good taste and recognize value. ‘If it wasn’t for IKEA,’ wrote British design magazine Icon, ‘most people would have no access to affordable contemporary design.’ The magazine even voted IKEA founder Ingvar Kamprad the most influential taste master in the world....

Questions 

1. IKEA has chosen to enter new markets mainly by direct investment. What advantages does this form of entry give it? Why doesn’t IKEA use franchising, like McDonald’s and Benetton do, as its main method of entering new markets? 

2. How would you categorize IKEA’s approach to developing an international marketing strategy in terms of standardization and adaptation? 

3. What are the factors that have helped IKEA to build a successful global brand?