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IKEA, Ye Kya Kiya?

BY UTHRA CHANDRASEKHAR | CAPTURED BY KASHIF ALI & ARCHI SAXENA | EDITED BY ARCHI SAXENA

When was the last time a band from the Indian Army cheered the opening of a brand, local or global? Blending nationalism and global chic, Ikea, the iconic Swedish furniture major, opened shop on August 9 in India at Hyderabad’s HITEC City to the rousing tunes of Muhammad Iqbal’s celebrated Saare Jahaan Se Achha played by no less than a band from the legendary Gorkha Regiment of the Indian Army. In attendance was the Swedish Ambassador to India, Klas Molin, Telangana IT Minister KT Rama Rao, IKEA Group CEO Jesper Brodin, and IKEA India CEO Peter Betzel.

Set in a colossal 400,000 square feet blue box the size of eight football fields, Ikea turned its India debut into a spectacular event with VR tours of the store on board specially painted and designed autorickshaws, decked-up cushioned and carpeted bus stops, and cheering staff waving Indian and Swedish flags.

According to reports, close to 40,000 people trooped into Ikea’s trademark blue box on day one, creating extraordinary traffic snarls, with the police forced to issue a traffic advisory about congestion. Alongside the band, was a circus trickster who entertained the customers waiting patiently in long serpentine queues outside the store.

The store is set over two floors, where one of the floors is the showroom with pre-designed rooms displaying Ikea’s products. All you need to do is jot down the item codes on pamphlets that you can pick from anywhere on the floor, along with a pencil and a chart. As the items are on display, you see prices of various products and what they look like. Once you choose what you like and pay for it, the products are delivered at your doorstep.

Madhav Shankar, a young 20-something shopper, told this writer in awe-struck tones: “It will take me a day to actually see the whole store and a week to understand it.”So, on day two, speaking to the media, IKEA India Deputy Country Manager Patrik Antoni said: “As the store is very huge, some were confused as to where to go. So, today, we have more coworkers to help people to get them to move in the right direction.”

Vishakha Tanmayi, who was keenly examining every product on display, said, “I feel like a lost tourist… But for people like me who like little innovative things, it’s all under the Rs. 500 range ($7.25).”

The products have been priced reasonably, keeping in view the price sensitivity of the Indian consumer, a key demographic insight Ikea had worked on while debuting in India. In fact, close to 1,000 products out of the 7,500 products on display have been priced under Rs. 200 ($2.90).

A young couple, expecting their first-born in the next few months,described the opening as a “godsend” at the right time.“Looking into the baby section, when we compared the prices with other stores, Ikea is quite reasonable.”

THE INDIA SPREAD

The Hyderabad store opened five years after the furniture major received the Central Government’s approval, in 2013, to invest Rs. 10,500 crores to open 25 stores in India by 2025. However, the company has since revised the number of stores to 40. Ikea officials plan to approach the government with their revised adjustments.

The company plans to launch the next store in Navi Mumbai by the summer of 2019, followed by a store each in Bengaluru and Delhi in the first phase. In the next phase, IKEA plans to cover Ahmedabad, Surat, Pune, Chennai, and Kolkata.

Before opening their first store in India, Ikea carried out extensive research of Indian households, gleaning insights into how Indian customers typically live, eat, sleep, and entertain by visiting over 1,000 homes. To further strengthen empirical data, they set up a makeshift Ikea store in Delhi and watched how invited families interacted with their products. They also flew out 75 Indian employees to Sheffield last year to help open a store in preparation for the India opening. Alongside, the company had opened a pop-up shop in a Hyderabad mall to start introducing their products to potential customers.

A couple, who has visited an Ikea store in the US, said, “We don’t see any difference, in fact, it even looks the same.” Ikea has maintained uniform international standards with regard to the structure and integrity of the store.

When asked about what was different in the newest Ikea store, an employee from the Netherlands branch said, “It’s exactly the same as every other store but we have a lot of different solutions specially made for Indian people. The products reflect the need of the customers.” Ikea has subtly tweaked its product types and range in keeping with the preferences of Indian customers, so there is more colour in their ensemble, with a lot more dining room furniture than usual along with “locally relevant products” such as lunchbox sets for multiple-course meals, frying pans, pressure cookers, idli makers, and mattresses packed with coconut fibre. These changes are not confined to their products alone but also to their in-house restaurant. So, Ikea has opened a restaurant with 1,000 seats where their famous signature meatballs will now be chicken or vegetarian. On the menuwill also be biryani, gulab jamun and samosas. So, that more or less completes the hyper-localisation Ikea has sought for its Indian launch.

Breaking from their traditional DIY approach of all their other international stores, Ikea has appointed their first team of 150 full-time employees who will help customers assemble furniture based on their preferences. The company will also deliver the furniture thus assembled to customers’ homes, a complete break from their global practices.

Ikea is employing 950 people at Hyderabad.Close to 90 percent of them are locals. In keeping with the company’s institutional practices in gender parity, nearly 50 percent of the employees are women.

Ikea also intends to substantially increase sourcing of supplies locally. On a global scale, India accounts for only 3 percent of the retailer’s total sourcing.

Juvencio Maeztu, the company’s Deputy Chief Executive, who spent the past six years preparing for the India launch, said that the Indian market was “an opportunity to make the next 75 years of Ikea”.

If the opening was any indication, Ikea is here to stay.

1 Comment

1 Comment

  1. gokulnath sivanandam

    August 13, 2018 at 2:27 pm

    Good read Uthra.. keep writing more 🙂 Congrats

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