In the globalizes market today, companies need to make a shift in focus to target consumers not only in their own local markets but across the globe as well. Due to the different cultures and product choices that consumers have throughout the world, companies need to provide a variety of product choices that appeal to consumers globally and locally.The report will first give a brief summary of the KEA case study, followed by the strategies used in targeting the global customer segment, followed by the importance of their brand image along with the marketing implications with it, followed by the advantages and disadvantages of adopting a standardized versus an adapted strategy in Kike's global strategy, followed by the effectiveness of communications and the similarity of the cultures of the world today. Lastly, a conclusion I will summarize the report.
KEA has established themselves as the world's biggest home furnishings retail chain.Their Swedish image has proved to be popular with consumers over the world for more than a decade. The success of the business is due to their ability to provide different products at a cost efficient rice. They are famous for the flat - pack assembly kit which helps to cut costs as consumers make the purchase and does the assembly themselves at home.
A critical part of their strategy in the customer's involvement in the shopping experience. It relies on customers to choose, collect, transport and assemble which contributes to the low prices.The way how KEA communicates to their customers is through their product catalogues that they provide for free. As shown in (Coffman et al.
Pig. 619- 620). KEA has successfully sold its home furnishing products in so many countries round the world through Kike's successful Concept & marketing strategy. Kike's main medium of communication to the consumers is through Kike's own product catalogue, providing more than a 100 million copies all over the world every year, free of charge. Kike's catalogues comes in a total of 45 editions in 23 different languages.
Inside each KEA store, there are hundreds of displays in realistic room setting that provide fresh ideas and know how on contemporary interior designs. Each different showroom encourages customers to sit, lie down, open ; close drawers, ampere styles, comparing prices, and to imagine the possibilities before deciding on their purchases. Consumers are more that welcome to have an interaction with the products in the show room. The idea of self - serving is also an important part of Kike's approach to customer involvement to keep their prices low.Most of Kike's products are also flat-packed, which makes it easier to carry the product home or the option for home delivery when a lot of purchase has been done. Assembly of products is easy at home with simple instructions ; construction design.
With preference to Kike's emphasis on customer involvement to keep prices low, their targeted segment was on the global middle class customer that shared similar buying habits. Even though that customer spending patterns may be similar across most countries, global customer segments still exist for 'KEA.For example, in the article by (Animates. Com), KEA went into different house-holds with different income levels in India to survey what kind of design and function would suit the daily needs and usage of the consumers.
This is a good example of how KEA has localized TTS products Tort ten Deterrent countries Ana cultures to sulk ten Deterrent needs Tanat may not be applicable globally. Next, the report will discuss on importance of Kike's Swedish brand image and its implication for marketing.Firstly, consumer's perception about the quality of a brand are influenced by a few factors such as the brand image, personality, associations and communication messages. A company invests in branding so as to assist customers in making purchase decisions by providing cues on quality, credibility and value about a product. This attitude might be positive, negative or neutral. One factor that influences perception towards brands is the place where it is made.
It is referred to as the country of origin effect.The country of origin is associated with perception of quality of the product and differs by product category and quality level of the country of production. As described by (Roll, 2008) With their strong brand image that they have established, KEA emphasizes the country-of-origin of its products to a large extent and use the Swedish origin in its marketing efforts to maintain their originality. All of their products are marked with Made-in labels to communicate their origin, especially hen the production of their furniture takes place all over the world.The company mainly still emphasize that their products are of Swedish design and origin as their business idea had originated from there.
In the article by (Yang, 2013), shows how the perception of the country of origin of the milk powder in china is affected when babies started dying due to the malnutrition that the milk powder provided. This goes to show the importance of the relationship between the countries of origin of the product to the consumer's perception of trust in the quality of the product that originated from the country.Over the years, KEA has managed to establish a strong positive image of their brand and products. Brand promotions and advertising has showed how successful KEA has come to be. Kike's Vision, "To create a better everyday life for the many people.
" explains why KEA is critical in maintaining low and affordable prices. Their idea of low prices, simple and effective function and design, makes KEA unique in their own way. Through their branding and customer centric approach and efforts, KEA has managed to build trust of their products in their customers.Regardless of the country of origin that the products KEA offers, consumers trust them to maintain the quality of their products and services as they have always managed to deliver quality products and service .
On the other hand, the marketing Implications that exist is the positive, negative or neutral attitude portrayed by consumers with regards to where the products are being made. Consumers tend to have an established attitude or preference when it comes to a particular product being made in a particular country.The perception of manufactured products from certain countries is affected by a built-in positive or active stereotype of the product quality. As discussed by (Sparkman). The report will now discuss the advantages and disadvantages of a standardized strategy versus adapted strategy for the case study.
KEA practices using a standardized strategy as their products are manufactured, packaged and positioned the same way in regards to any of the country in which they are sold.As stated above, KEA packages all their furniture in flat - pack kits across all stores around the globe as this is their unique selling point. The stores in every country are build the same way with the yellow and lull colors as the main theme of the building with showrooms portraying the Deterrent ageless consumers can conclave welt I EAI products. I nose as alehouses Day Cones, 1996) The advantage of having a standardized strategy I that it can provide cost savings as KEA is famous for their flat - pack kit and this allows them to cut down on transportation and assembly costs.They also provide the same products across the globe, enabling them to make bulk purchases from their supplies thus reducing production costs as well. On the other hand, they would not be able to fully socialize their products as it would be more costly to do so for each and every country.
It is also due to their main advertising through their catalogue which only reaches out to a selective and limited market segment. Although it is their main focus to use a standardized strategy, in recent years, the retailer started using an adaptive strategy to strengthen its presence in the global market.In order to be successful in the different countries, the products that are offered ought to have different versions to appeal to cultural preferences. One example is KEA stores in China produced 50,000 plastic placemat in 2005 to honor the year of the rooster. Through adapting a cultural approach, consumers will be aware that KEA understands their cultural needs and it would entice the consumers to patronize KEA more.
Lastly, Cultures of the world are becoming more similar.Information and communication technologies (Sits) are seen as a cost-effective and convenient meaner to promote products and services. With the increase usage of Sits, marketers are allowed to market their products and services everywhere and anywhere through not Just television commercials and radios, but also through internet and social media. It has helped to increase consumers' awareness towards their products and also their branding. For instance, KEA has been showing different kinds of advertisements every day in their website.
This advertising campaign has seen the company produce 365 advertisements.This not only builds up the consumers' curiosity towards what they will promote every day, they also allows the consumers to view the functionality of the products through the advertisements, which will assist them in their purchases. Not only Just showing 365 different advertisements daily, they have also created advertisements that are broadcasted through the television. With the aid of the advertisements through websites and televisions, it allows consumers from all over the world to know about the brand 'KEA, and also the products and services they provide.
In conclusion, KEA main method of providing low prices is through their flat - pack kit which saved them a considerable amount of money. The adoption of both the standardized and adapted strategy has put KEA prominently across the global market as well as the increasing exposure towards the internet and television has ultimate the global culture, enabling the transfer of culture across boundaries and acting as important global promotional tools for global brands, resulting in similar consumer behavior and buying pattern.