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Marketing Insight: Brand Audit of IKEA

“At IKEA our vision is to create a better everyday life for the many people. 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.”




About the Brand: History

IKEA is a Swedish-founded multinational group founded in 1943, by Ingvar Kamprad. The brand name represents the founder’s initials (IK) as well as the initials of the names of the farm and village that he grew up in, Elmtaryd and Agunnaryd (EA). Initially, it started as a mail-order sales business but five years later, it began to sell furniture. The company is popular for designing and selling ready-to-assemble furniture, kitchen appliances, and home accessories. During the 1980s, the company expanded dramatically into new markets, such as USA, UK, France etc. And from there on it went on expanding in size and exploring markets. By 2008, it became the world’s largest furniture retailer. IKEA is known for its do-it-yourself furniture’s modern designs, the eco-friendly simplicity of its offerings, and affordability. Today, it operates in over 49 countries.

Unique Selling Proposition of the Brand

The unique selling proposition of IKEA has been its good quality yet affordable, DIY (Do-It-Yourself) furniture. Over years, it has taken multiple innovative initiatives to improve its operations and ultimately cut its costs, giving the benefit to the end-consumers of affordable furniture. This is complemented by the modern designs that IKEA showcases in its products.

According to Interbrand’s Best Top 100 Global Brands 2018, IKEA stands on the 27th position. This kind of brand equity has developed over the years of the persistent deliverance of great performance. The key attributes that define the brand are as follows:

  1. Low Price
  2. Sustainability
  3. Form
  4. Function
  5. Quality

These attributes define what the company stands for, and they can be easily be seen in the products offered in their stores.

IKEA Brand Portfolio

Apart from furniture, it also offers storage solutions, kitchen accessories, and in its stores, food products are also available. The wide range of products is categorized into many categories based on function and then further divided into series, with its own name. It offers good quality, low prices for its products and unique and practical in-house designs. Since it has a huge variety, it caters to a wide range of customer segments, not just the ones looking for affordable solutions. Currently, there are about 20 product categories, divided according to function and further, there are series.

Communication, Pricing, and Distribution

IKEA uses innovation even in its communication. It uses a combination of multiple communication channels and has developed many celebrated campaigns with unique approaches. The interesting thing to note in this case is that it whatever may the message by, there is always consistency in the message across channels.

IKEA involves print media, electronic media, and social media for communication. IKEA traditionally advertised on television and print media. Since, its initial years, print media has played a big role in the company’s communication strategy. Initially, catalogs were printed to initiate sales. Till date, IKEA catalogs are a crucial part of the communication strategy. The new technology has been integrated with the printed catalogs to provide a virtual facility for people to view the furniture pieces in their homes from their mobile devices. Other than print media, the company has extensively used television, where they have published very unique campaigns to win the hearts of the audience. It also makes use of social media platforms such as Instagram, Facebook etc. to come up with innovative posts to raise awareness of their brand.

IKEA has adopted a low pricing policy for its products. It provides high value to its customers in terms of the price as well as the quality of their products. To maintain low prices, they fix on a price that would want to keep for their product as their target and work their way through backwards to achieve the target price. The design team takes into various factors (to the minutest of the details), to keep the prices as low as possible. The company distributes its offerings through its own retail stores with large spaces. There are more than 415 retail stores all over the globe as of 2018.


Customer Knowledge

IKEA has leveraged its operational excellence and simplicity in every aspect of its culture to become the world’s largest furniture retailer. ate IKEA, as a result, enjoys an extremely well-developed brand recall. The brand associations for IKEA might be “affordable”, “modern”, “high quality”, “contemporary”, “innovative”, “fun”. Below is a hypothetical IKEA Mental map.

The Brand Mantra of IKEA is to create a better everyday life for people, implying that IKEA not only helps simplify the big things in people’s lives, but also simplifies day-to-day activities of people.

IKEA Mental Map

IKEA Mental Map

Sources of Brand Equity

The brand’s name, IKEA, is the most essential source of brand equity. Its brand logo consisting of the iconic blue and yellow color (influenced by the heritage of the home-country, Sweden) is another source of brand equity. It has maintained consistent quality, an efficient distribution network and standardization in all the countries that it operates in. Through the concept of self-assembly, it was able to cut down its costs, which ultimately was transferred to the end consumer, in the form of lower prices. By not compromising on the quality and providing quality products at affordable prices for the price-oriented customer, it has been able to create value for the customer. Other key sources of IKEA brand equity are Innovation, Collaboration with Designers and Social Initiatives by the Brand.

Innovation. IKEA is known to take direct insights from the real lives of consumers, to come up with products that will make consumer’s life easier and does go with the conventional method of pushing their designs in the market, and not considering the actual requirements of the consumers. Thus, they come up with innovative solutions to common problems that people face in their day-to-day lives.

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Collaboration with Designers. IKEA also collaborates with upcoming and established designers to create product lines. The company believes that it is not the name that they really want to share, but it's the designers’ experiences that the company wants to learn from in order to deliver better. Their creations are then imbibed in the global product range.

Social Initiatives. IKEA understands the importance of sustainability and undertakes various social initiatives for building a better community. It works towards encouraging gender equality, curbing child labor, responsible energy consumption, and waste disposal, sustainable sourcing and also supports and works with world-renowned organizations like the UNICEF and Save the Children on other social issues.

The Customer-Based Brand Equity Pyramid (CBBE)

IKEA enjoys high brand awareness and brand recall. The figure below highlights the key aspects of the IKEA CBBE pyramid.




The IKEA brand audit reveals that the brand has developed high brand equity with time through both product and market innovation. But there are still areas of improvement, which can be looked upon as opportunity areas for the brand.

Localization according to country: Every country has its own culture, and as IKEA is expanding into newer markets it should also understand the local needs and lifestyles of the country’s natives and modify its offerings accordingly. Just like McDonald’s has been successfully doing over the years. In an example, of how in 2018, it entered the Indian market, where Do-It-Yourself concept does not exist, it will be easier for the brand to have higher brand equity in the market if it adapts to the lifestyles of the market.

Leverage the Online Space: IKEA is facing tough competition from other players in the furniture and home furnishing domain. It should find ways to bring about a strong online presence, as it has been able to successfully do in the conventional retail space. One of the advantages in doing so would be that accessibility of products in areas around the world would increase. Right now, the products may not be easily accessible to the consumers due to the distance. Leveraging online space will help IKEA achieve that.


Points of ParityPoints of Difference

Home Furnishing



Do-it-Yourself, Self Assembly

Functional benefit


Good Quality

Leveraging its origin (Sweden)

All in all, IKEA has successfully used elements of brand management to develop high brand equity and create value for the brand.


  1. Bureau, A. I. (2018, July 13). Here is Why IKEA Ads are So Impactful. Retrieved from AdAge:
  2. Koniorczyk, G. (2015). Customer knowledge in (co)creation of product. A case study of IKEA. Journal of Economics and Management , 22 (4).
  3. Asseldonk, E. v. (2016, October 25). Ikea sets the prices of its products before they're even designed. Retrieved from Business Insider:
  4. Baxter, M., & Landry, A. (2012, November). IKEA: Product, Pricing, and Pass-Through. Retrieved from FRBSF:
  5. Yohn, D. L. (2015, June 10). How IKEA Designs Its Brand Success. Retrieved from Forbes:
  6. IKEA. (n.d.). The IKEA Concept. Retrieved from IKEA:

© 2018 PGupta0919


PGupta0919 (author) on September 11, 2020:

Thank you Rajesh and Kirk.

Kirk Musick MS MBA from Miami Beach, FL on August 16, 2020:

Great read... I am always pushing the USP to our clients, stressing the importance of brand authority and the USP.

Rajesh Padmanabhan on November 14, 2018:

Awesome article. Well-written, Ms. Priyanka Gupta. All the 4C's of modern-day marketing crisply addressed.

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