New stores and online growth help IKEA fend off rivals

Published October 11, 2018, 12:00 AM

by manilabulletin_admin

By Reuters

IKEA reported a 5 percent rise in annual sales on Wednesday as strong online growth and new stores in countries such as India and Latvia helped the world’s biggest furniture retailer to cope with mounting competition.

The Swedish chain enjoyed decades of rapid growth as shoppers flocked to its out-of-town warehouses to pick up cheap furniture to assemble at home.

A car drives past IKEA store in Stockholm, Sweden October 8, 2018. (REUTERS/Anna Ringstrom/Files / MANILA BULLETIN)
A car drives past IKEA store in Stockholm, Sweden October 8, 2018. (REUTERS/Anna Ringstrom/Files / MANILA BULLETIN)

But with the rise of online rivals such as Amazon and made.com, and signs consumers’ enthusiasm for DIY home improvements is waning, IKEA is now investing in e-commerce, city-center showrooms and services such as furniture assembly.

Barbara Martin Coppola, chief technology officer at IKEA Group, the owner of most IKEA stores, said tests underway ranged from connecting staff with customers via video to artificial intelligence tools to help people furnish their homes.

“It’s fantastic to see human interaction through technology when the consumer might need help or advice on where to place furniture,” she told Reuters in an interview at a new IKEA city-center store in Madrid dedicated to living room furniture.

The Swedish chain enjoyed decades of rapid growth as shoppers flocked to its out-of-town warehouses to pick up cheap furniture to assemble at home.

But with the rise of online rivals such as Amazon and made.com, and signs consumers’ enthusiasm for DIY home improvements is waning, IKEA is now investing in e-commerce, city-center showrooms and services such as furniture assembly.

Barbara Martin Coppola, chief technology officer at IKEA Group, the owner of most IKEA stores, said tests underway ranged from connecting staff with customers via video to artificial intelligence tools to help people furnish their homes.

“It’s fantastic to see human interaction through technology when the consumer might need help or advice on where to place furniture,” she told Reuters in an interview at a new IKEA city-center store in Madrid dedicated to living room furniture.

 
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