Strategic Marketing Objectives & Target Market - IKEA - Case Study Example

Strategic Marketing Objectives & Target Market This section will look forward to provide the different strategic marketing objectives, marketing strategies which IKEA can look forward to so that they can perform better in the market. This will thereby help to identify the target market and also the different marketing issues which they need to address so that the overall framework helps to improve their performance in the future. Objectives of Marketing Plan The objectives which IKEA has identified and wants to achieve through their marketing plan are as To ensure better penetration in the market so that they can reach every customer who stays at different nook and corner of the country. This will help to improve the market presence and will provide a wide market to cater at. To increase their market share by consolidating their position in the market and at the same time working on the same business model and ensuring that customer satisfaction is maximized. To retain customers so that their bench of permanent and loyal customers can be increased which will thereby help to improve the overall functioning and will provide the required dimensions through which better results will be achieved (Gabbot, 2004). This will help to improve the overall business and would guide towards smooth functioning of the different services To ensure consistency with the environmental and legal environment and continue to develop policies which will look at the well being of the society and contribute towards positive growth and impetus which will help to ensure better results Marketing Strategies The marketing strategy which IKEA has adopted is something different when compared to other players working in the same business. IKEA spends around 8% of its budget on advertising which is very small compared to other giants who have a substantial budget on advertising (IKEA, 2015). The majority of the expenditure is made on catalogues which is circulated free to households and other places. Since, the catalogue is updated on a regular basis as different type of furniture, price and offers are displayed so it is used as a main medium of marketing their product and the catalogue designed for 2015 is (Amey, 2015) Catalogue serves as a main medium of marketing and helps to generate business not only through creating awareness but instead results in actual sales. In addition to it the catalogues are designed in such a manner that it gives the customer a feel of the different products which are being sold (Capell, Sains, Lindblad 2005). This thereby helps customer to understand the manner in which they will be better by using IKEA furniture and helps to bring about the required change in the mindset of people. Despite working on a global level the marketing strategies are designed and developed keeping in mind the local market. The organization focuses on relationship and looks to tap the local customers with the help of independent agencies so that long term business can be established. IKEA also uses the different form of media to advertise like cinemas, hoarding, television, press, radio and internet. The amount of budget which has been allocated is low but IKEA looks at using the different medium for marketing their product. Internet has helped IKEA immensely as people can visit their website, gather information and also purchase products directly. This has thereby acted as a platform through which not only awareness is generated and information is passed but along with it customers are persuaded to purchase the product which thereby contributes to their bottom line. Along with it IKEA participates and organizes different events which are telecasted across the globe using different form of media. In addition to it IKEA sends newsletter and mails to customers who have subscribed to them (Hochwald, 2000). This helps the customer to keep updated about the new products, offers, discounts and other important areas through which customer different needs and wants can be met. IKEA which looks to function on a global level has further integrated the needs of local community. It looks to offer different promotional discounts, loyalty program points, offers and other facilities so that customers lure towards the product. This has helped IKEA to be able to identify the different dimensions through which different needs of the customer can be met and the marketing strategies has helped them to target the correct market segment. Target Market IKEA has looked towards attracting all section of the society who is looking towards purchasing furniture which is of good quality. The overall dimensions of the target market has been based and developed on catering to the different needs and requirements of the different section of the society. This has thereby helped to identify the following target market which IKEA looks to attract Final User: IKEA looks towards final user who are the final consumer. The final consumer includes household, organization, business corporate houses and other final consumer who are looking to purchase the product. The company thereby looks at attracting all segment of the society who are the final user and look towards purchasing quality products. Intermediate User: IKEA further looks at attracting intermediate user who will further look to sell the product to the final consumer. This has helped IKEA to ensure that they look to tie up with different people who will help to pass the product to the final consumer. IKEA there looks at ensuring that through the process of intermediate user they are able to develop the required link through which goods can be passed to the final user. The manner in which IKEA has worked will look to eliminate the middle man and will help to ensure that cost remains low. The overall dimension of IKEA further looks towards the following segment of consumer Demographic Segmentation: Based on the demographic level IKEA looks to attract people of all age based on education level, location, age and gender so that people of all age are attracted towards the product (Gosselin, 2004). Having products which are designed for people of all age group will ensure that IKEA will be better positioned to capture the larger segment of the society Behavioural Segmentation: Based on the behavioural segment IKEA looks towards making changes in their offerings by designing products which matches the different needs and requirements of consumer (Gosselin, 2004). Identifying the need and designing product which look to meet the different need has further helped to ensure that the product is aimed towards all section of the society Geographical Segmentation: IKEA further look at ensuring that they work in the global arena which has helped them to ensure that the product is available world wise. This has thereby ensured that IKEA looks towards targeting all people all around the globe as people can purchase the same online and will thereby help to provide a large market to cater to the different needs of the people (Gosselin, 2004). Marketing Problems & Issues The different marketing objectives and dimension which has been identified it used successfully will help to ensure better productivity but it faces certain issues and problems which are as Concerns regarding the issue of marketing strategy are very prominent as despite the availability of different options IKEA faces difficulty in implementing the process through which marketing activities will provide better returns (Björk, 2000). The marketing activities further need to look at different dimensions which will thereby help to bring about the required turn around through which better usage of marketing option become possible The degree of competition is very high as other players and competitors look to follow and use similar strategy. This has thereby made it difficult to garner the required gains from the marketing activity as the overall gains get limited. This is a major consideration for IKEA as identifying the strategy which will help to provide the required differentiation strategy needs to be looked at Lack of innovation and strategies which will help to identify the mechanism through which marketing strategy will provide maximum returns is lacking. This has limited the overall gains which IKEA was looking towards garnering from the marketing strategy and needs to look at identifying ways through which marketing activities can be improved Lack of proper personnel and human resource who are capable of carrying out the marketing activities in an appropriate manner is another concern. IKEA needs to develop a pool of talented employees who will be capable of delivering superior performance and can use the marketing activities to deliver superior results. Recommendations IKEA based on the overall dimensions need to look at different strategies and mechanism which will help them to improve their business. IKEA needs to look at the following Develop aggressive marketing strategies which are aimed not only towards attracting new customers but at the same time retaining old customers. This will aim towards working on different dimensions through which customer satisfaction can be enhanced so that more customer lure towards the product and look to purchase the same product again and again IKEA needs to look to advertise and market their product. They will help to develop strategies where they look to increase awareness in the market. This will help to improve their brand presence and will provide an opportunity through which they will be able to cater to a huge market. This process will look at ensuring that the marketing strategies which are aggressive and look at retaining more and more consumers IKEA further need to look towards different promoting activities where the look to offer discounts, offers and loyalty points to customer who are permanent. This will help to ensure that IKEA will be able to develop a pool of loyal customers which will help IKEA at all times (Lee, Smith, Grimm, Schomburg, 2003). Further, the strategy will ensure that IKEA will be able to attract new customers as well and will be able to maximize their chances of gaining productivity in the market IKEA needs to look at finding out the pool of talented employees who will be able to deliver quality result. This will help IKEA to ensure improved productivity and will work towards achieving different results. The overall framework will ensure that IKEA will be able to work on different dimensions and ensure that their marketing strategies are used on the best possible manner References Amey, K. (2015). Introducing the bookbook, it comes fully charged and the battery life is eternal': IKEA creates hilarious advert for new catalogue poking fun at Apple products. Retrieved on October 1, 2015 from http://www.dailymail.co.uk/travel/travel_news/article-2747974/Introducing-bookbook-comes-fully-charged-battery-life-eternal-IKEA-creates-hilarious-advert-new-catalogue-poking-fun-Apple-products.html Björk, S. (2000). IKEA: Entreprenøren – Forretningsideen – Kulturen, Index Publishing AS, Oslo Capell K., with Sains A. in Stockholm, Lindblad C. (2005). in New York, Palmer A. T., IKEA, Business Week. New York: 3959, 96 Cuthbertson, R. (2007). Ikea's card is a global drive for local people, Promotions & Incentives, London: 13, 1 Gabbot, M. (2004). Introduction to Marketing: A Value Exchange Approach. Pearson Education Australia, Frenchs Forest. Gosselin, K. (2004). To its furniture store rivals, IKEA's not a threat yet. Knight Ridder Tribune Business News, 31 Jul, pg. 1. Hochwald, L. (2000). Tuning in to the right channel. Sales and Marketing Management, 152 (3), 66. IKEA. (2015). Financial Report of IKEA 2015. Retrieved on October 1, 2015 from http://www.ikea.com/ Lee, H., Smith, K., Grimm, C., Schomburg, A. (2003). Timing, order and durability of new product advantages with imitation. Strategic Management Journal, 21 (1), 23. Read More