The Factors of Costumer Behavior Motivation in IKEA

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INTORDUCTION

The main purpose of marketing is to meet the needs of the customer and to make the customer feel good during shopping and to ensure that the experience gives positive results for the customer and the seller. There is no easy and specific way to improve the motivation of the customer to purchase the product or service since the motivation to buy the product or service may differ for all customers. If the customer’s motivation to buy the product or service is not analyzed correctly, some major mistakes can be made. For marketers and communication professionals, estimating the motivation of consumers to buy products and determining where the trend is evolving is considered to be one of the most significant issues.

In this study, it is examined that how customers’ purchasing motivations change and how it can improve their purchasing motivation and experience in the providers store for the retail furniture giant IKEA stores.

METHODOLOGY

In the first part of the study, company information about IKEA, customer portfolio target, annual sales capacity and store structures will be examined. In the second part, customer motivation for purchasing products and services will be analyzed. At this stage, Maslows Hierarchy of needs and Heisenberg hygiene theory will be used. In the third part, five situational influences which are physical surroundings, social surroundings, temporal perspective, task definition, antecedent states will be assessed. In the fourth part of the study, some recommendation will be provided as a a consumer behavior consultant. These recommendations are about how to improve the marketing strategy of the seller.

INFORMATION ABOUT IKEA

Overview of The Company

IKEA is a Swedish furniture retail giant. It has stores all over the world and reaches millions of customers every month. IKEA became an international retailer when the first store in Norway opened in 1963.

The company expanded beyond the Nordic countries in 1973, when a store was established in Switzerland. Thereafter, stores opened in many countries, including Germany (1974), Australia (1975), France (1981), the United States (1985), the United Kingdom (1987), China (1998), and Russia (2000). The typical IKEA store is extremely large, generally covering an area of 186,000 square feet (17,280 square metres). IKEA is not owned by shareholders. Instead, it is controlled through a number of operating companies, holding companies, and nonprofit foundations. The complex corporate structure was created partly in response to high Swedish taxation.[1]

As it is seen, IKEA is an old-aged firm. They have approximately 450 stores around the world. IKEA sold 38.8 billion euros ($44.6 billion) of goods and services in the 12 months through August, up 5 percent in local currencies, brand owner Inter IKEA said. The growth rate was roughly the same as the year before. IKEA, whose stores are owned by 11 franchisees, opened 19 new outlets, taking the total to 422 in more than 50 markets. The largest franchisee is IKEA Group, with 367 stores.[2]

Target Market

The global retailer IKEA, has deliberately designed products to address the target market and further reduced costs by facilitating operations with local suppliers. Although the products are not very expensive, they have a good quality. Customers are aware of this and know that they will not be faced with a huge budget surprise at IKEA. Besides, customers know that if they need any furniture for their home, they can find it at IKEA for the best price. In this case, it can be said that customers with a medium-economic level are main market targets for IKEA.

IKEA’s main shoppers are classified as not-old, mid-range and upward mobile, preferring low-priced yet trendy furniture and home products. The company’s CEO defines IKEA’s target market in the US as ‘someone who travels abroad, loves to take risks, enjoys fine dining and wine, has frequent flies, and adopts consumer technologies early.’ Recently, IKEA has developed product plans to increase the use of waste or recycled materials due to the increasing demand of its customers for environmentally friendly products.[3]

Business Strategies

It seems obvious that IKEA has adapted to international markets while staying true to its business concept. Besides, IKEA is a concept-driven company where it is necessary to manage operations and share information through the IKEA method, regardless of the location of the retail outlet. Open communication is vital to IKEA’s operational systems. For example, if there is a problem takes place, not only external but also internal networks are used to have quick solutions. This coincides with research that argues that good relationships are important to enable knowledge sharing. IKEA devotes considerable time to product development and strengthens long-term relationships with its suppliers to produce products cheaper and to constantly find new ways to produce a better product. Strategic global outsourcing of product manufacturing enabled IKEA to effectively lower prices for its products, leading to international expansion. In addition, productive internal competitiveness has developed between retail stores and supply chain distributors.[4]

COSTUMER MOTIVATION FROM THE PERSPECTIVE OF MASLOWS HIERARCHY OF NEEDS

First of all Maslows Hierarchy of Need Theory should be defined to be able to recognized the motivation of costumer. Maslows Hierarchy of Need Theory categorized the needs of human on the basis of their hierarchy. Maslow’s hierarchy table is most often shown as a pyramid structure. Basic human needs are on the lowest stage of the structure while self actualization is on the top of the structure.

The groups of users who are motivated to purchase Ikea products range from students to young married couples and individuals in small residences. Among the people, whose value affordability and are aware of space saving opportunities are primary buyers.

Ikea also creates opportunities to take advantage of low turnout, utilitarian purchases by using marketing tactics such as quick grab items and cash space shopping. Intrinsic motivation is another important factor that motivates buyers as they can gain pleasure or a sense of accomplishment from the experience of putting together a piece of furniture.[5]

There are some reasons why IKEA addresses to people with narrow and medium economic levels, having a wide range of products, convincing people to adopt the DIY(do it yourself!) philosophy and having fun to install the product offer many ways to meet customer motivation.

When you need a furniture (suc as a chair for your study desk), you look for ways to purchase a chair. It is the first step of Maslows Hierarchy of Need Theory which is physiological need step. You feel yourself in good hands because of purchasing this chair from IKEA. This means that you are on the second step which is safety needs. Because IKEA is a well-known brand you feel yourself belonging a huge community. So it shows that the third stage of Maslows which is belongingness is come true. You purchased a new chair because you think it take a prestige to you, maybe some of your friends will see the new chair and they will tell you how a good chair that. So the Maslows Hierarchy of Need Table’s fourth stage with is Ego Needs (Esteem Needs) comes true. You purchased the chair, you transferred it yourself, and you set up the chair by using the set-up papers. So, the top need of Maslows Hierarchy of Need Table which is self actualization came true.

So IKEA utilize the theory of Maslows Hierarchy of Need on motivation of costumers. If it is managed correctly, this retail furniture giant IKEA could benefit greatly from this trend of costumer motivation.

SITUATIONAL INFLUENCE

Consumer behavior can be determined by knowing situational influences. The situational effects influence the behavior of costumer apparently. The situational influence involves five categories which are physical surroundings, social surroundings, temporal perspective, task definition, and antecedent state. Physical surroundings refer to the area of shopping center. If it is sufficient physically, one may want to there and purchase the products she/he need. Social surroundings refer to the friends’ opinion. If your friend like the products you purchased before, you can go and shop on IKEA again. Temporal perspective refers to a particular point of view or attitude an actor has about time. For instance, if you go to IKEA on winter, the shopping area will be well heated, and if you go to IKEA on summer, the shopping area will be well-cooled. Task definition refers to reasons that people decide to purchase a product from IKEA. Antecedent states refer to momentary conditions. If one knows the the product she/or he need is being sold in IKEA, then the lowest price is in IKEA.

The main influence aim of purchasing is awareness of IKEA’s products. There is no other product catalog in the world that is as famous as IKEA. IKEA places a lot of emphasis on advertising and its returns. Customers’ familiarity with IKEA increases with advertisements and product catalogs reaching their homes. Thus, they adopt IKEA and IKEA products. IKEA places great emphasis on customers spending time in the store and convincing them that this time is not a waste of time. They establish the store structure that will allow the customer to see all the products in the store in order to increase the quality of the time spent in the store. Once a customer enters the store, they have the opportunity to experience all the products in the store by getting into the flow of the shopping and following the road.

In addition to these, customer will see the product she/he will buy in the simulated room structures in the store. For example, a customer who comes to IKEA to buy a kitchen cabinet gets an idea in the store about how that cabinet can be positioned in a sample kitchen.

In addition, IKEA maintains its restaurant side in their stores. This ensures that the customer who comes to IKEA for shopping and is tired of spending hours, knows that she/he can eat at the IKEA restaurant at the end of the shopping and that he does his shopping with the clarity of mind that this gives.

RECOMMENDATIONS

When examining IKEA’s customer portfolio, it was concluded that the biggest customer group was newly married families and young people preparing to get married. The reason why customers in this category prefer IKEA is that IKEA sells more modern products than other stores in the country. It has been concluded that, in order to maintain its reputation, a special customer loyalty program for people who are coming to IKEA for purchasing furniture for their new house can bring a great advantage for its sales.

Customers who come to IKEA to shop spend at least 1 hour in the store. Research shows that the shopping trolleys used in IKEA are either too big or too small. With the improvement to be made in shopping trolleys, customers will feel more comfortable by using more ergonomic shopping trolleys and it will increase their purchasing possibilities by focusing more on the products sold.

IKEA has been using famous product catalogs for product promotions. Thanks to these catalogs, people would be aware of new products and their prices. However, people now prefer online areas rather than paper catalogs. Therefore, if IKEA wants to reach young customers under the age of 50, they should aim to reach this potential customer portfolio through the social media. Ads on the Instagram or Youtube can be a great way to do this.

When the structure of IKEA is examined, it is seen that there are few stores in big cities, but these stores are built in a very large area. IKEA stores may be far away from some customers’ homes. In addition, a customer who comes to the store to buy a specific product may lose time because the store is too big.

Instead, IKEA may consider reducing store sizes and increasing the number of stores. For example, stores might be divided into different sub-components stores such as IKEA-BATH, IKEA-GARDEN, IKEA-FURNITURE, IKEA-KIDS and might be located these stores in different parts of the cities. Thus, customers who plans come to IKEA to buy a garden product but do not come to IKEA to avoid walking too much due to IKEA’s store structure may now come to IKEA. In addition, IKEA stores located in different parts of the city will increase the brand awareness. More stores in the cities means customers can access IKEA products easier.

IKEA restaurants are known as well as IKEA products. Some people prefer IKEA with the comfort of being able to eat their meals at IKEA restaurants after purchasing their furniture, garden equipment or household item needs. More variety of products in IKEA restaurants will increase people’s demand for stores. The best way to achieve this is if IKEA’s restaurants in different countries offer dishes specific to their country. For instance, fast-food products being offered in stores in the United States, kebap-doner in Turkey, vegetables in Mediterranean countries can be added as food product alternatives. Thus, customers who come to shop will feel at home and their loyalty and belonging to the IKEA brand will increase.

CONCLUSION

IKEA’s excellent product range, providing an impressive experience to its customers, and the perception that it sells cheap and quality products can be shown among the positive features of IKEA. IKEA is a well-known brand that people on the different countries can access the same product.

With the developing technology and internet usage, people’s shopping behavior is also changing. IKEA has to keep up with this change. It is well known how many giant brands that cannot adapt to developing technology have become history. Each customer has a different shopping behavior. Brands reach awareness as much as they can contribute to customers’ needs and shopping experiences.

In this assessment, there are some recommendations were given. Developing a good customer loyalty program, improving a more ergonomic shopping trolleys, using online and social media for ads, dividing stores into more specific meaning, and developing their restaurants’ quality will improve customer’s experience.

Improving customers’ shopping experience is, of course, not limited to these recommendations. However, it is certain that the recommendations presented will help this need

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