THE BRANDING OF IKEA

Company background

The brand IKEA was founded in 1943 in the small town of Agunnaryd, Sweden, by

Ingvar Kamprad.  

The first catalogue was introduced in 1951 and with this the founder saw his chance to

expand his business on a larger scale, and this was the year he decided to completely

focus on low-price furniture, as from the beginning IKEA sold mainly matches,

watches, Christmas decorations, picture frames and jewellery.

In 1956 the company came up with the concept of ‘flat-pack’ self-assembly furniture.

The first international IKEA store was introduced in Norway in 1963, and was soon

followed by the opening of stores in Denmark, Germany, Australia, Canada, and Austria.

In 1987 the first IKEA opened in the UK, and in 2001 the company had 143 stores in 22

countries.  

Today we are the leading furniture retailer in the UK with a 12.1% before MFI and DFS.

Our Brand – an introduction

The brand name is associated with feelings, attitudes or different meanings, and in our

minds it is connected with a certain image.  All inspired by the logo, design or colour.

Branding is a way to differentiate one company, its service or product, from competitors.  

But also to provide it with a personality which is both appealing and unique to their

potential customers.  It is a multifaceted, disciplined and multilayered process.

IKEA is seen as friendly, quirky, trendy, social, young, independent, witty and relaxed.  

Usually the personality of a brand is described as a person, with its different

characteristics.  

The importance of branding

In the past decade companies are starting to see their brand assets, and with this branding

has taken on a greater significance.  So today brands are more than just marketing

slogans and logos.

All businesses are building their brands through certain actions and in their actual

presence they find a ‘position’ in the mind of consumer and prospects.  This is based on

experience and exposure of the brand in the competitive marketplace.

There are certain advantages to take into account in a Brand Strategy;

Financial Advantages, Strategic Advantages and Management Advantages.

The financial advantages may be higher sales, and for the companies with more market

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shares; higher margins.  IKEA is one of the leaders in its market place, and therefore

many other brands in that particular sector may be ‘hitchhiker’ brands following us and  

other leaders (such as MFI and DFS).

Strategic Advantages are where the brands position is in relation to its competitors.

The Management Advantages include global branding, endorsement and extensions;

Brand extension

Brand extension is when a company is using an existing brand from a ‘parent’ (such as

Nescafe from Nestle).

Extensions are usually introduced as they have more advantages and these can be

transferred to a new product, with ...

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