Ikea

1. How does Ikea generate customer loyalty?
It is well known that IKEA has successfully established its customer loyalty and its brand has also become the most famous one in furniture industry all over the world. These are due to several reasons which are discussed below.
First of all, high quality is the core strategy of IKEA. No matter what the furniture looks like, how much the price is or how long it can be delivered, the most important thing concentrated by customer is always the quality of product. Thus IKEA keeps focusing on a couple of elements such as the material used, the process of producing, training of co-workers to maintain and enhance its quality, this core strategy becomes the foundation and helps IKEA accumulates customer base.
Secondly, IKEA is able to provide customer a unique shopping experience. This is regarded as the most competitive advantage of IKEA compared with other producers or retailers. For customers, it seems like they are visiting a gallery after they enter IKEA’s gate. The exhibit of each area can also bring excellent ideas about how the furniture can be placed after purchasing.
Beside, IKEA always offer its customer with extremely low price products. As it says: "We should take care of their interest." IKEA kept reducing the orignial price annualy and set the possible lowest price to customer. Although it seems this strategy pulls down the margin, the reality is IKEA could still enjoy 10% higher margin compared with its competitors because of the increased number of customers.

Finally, target market and market segmentation are also the key areas where IKEA puts research on. In this part, it mainly concentrates on how local culture can be adopted with its products in terms of factors like design or appearance when entering a new market. So it is not necessary to introduce it products officially and formally, IKEA is still able to gain customer loyalty in new area.
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