IKEA Design and Branding

Design and Branding

• IKEA focuses on minimalist and functional design with a Scandinavian aesthetic.
• The brand emphasizes affordability, sustainability, and DIY assembly, resonating with their target audience.

The Three Levels of Products

• Core product: problem-solving benefits that consumers seek.
• Actual product: characteristics include quality level, product and service features, styling, brand name, and packaging.
• Augmented product: additional consumer services and benefits.

Product and Service Classifications

• Convenience products: inexpensive products that require minimal effort from consumers (e.g., bread, soft drinks, pain relievers).
• Specialty products: unique characteristics or loyalty to a specific brand.

Pricing Strategies

• Competition-based pricing: setting prices based on competitors' strategies, costs, prices, and market offerings.
• Market-skimming pricing: initially setting high prices and then reducing them over time (e.g., Apple iPhone).
• Market-penetration pricing: initially setting low prices to enter the market and build a reputation (e.g., Toyota Lexus).

Promotion Mix

• A company's total promotion mix consists of advertising, public relations, personal selling, sales promotion, and direct marketing tools.
• Advertising: paid form of non-personal presentation and promotion of ideas, goods, or services.
• Public relations: building good relations with the company's publics by obtaining favorable publicity.
• Personal selling: personal customer interactions by the firm's sales force for the purpose of engaging customers, making sales, and building customer relationships.
• Sales promotion: short-term incentives to encourage the purchase or sale of a product or service.
• Direct and digital marketing: targeted marketing efforts to attract customers.

Services Marketing Mix

• Product: the core service offered (e.g., hotel rooms, university courses).
• Price: varies according to the value perceived by the customer.
• Place: the location of the service (e.g., hotel location, university campus).
• Promotion: marketing efforts to attract customers (e.g., social media campaigns, open houses).

MCQs

• Value-Based Pricing focuses on capturing a premium price based on the perceived value of the product.
• Skimming Pricing involves setting an initially high price and gradually reducing it over time.
• Penetration Pricing involves setting a low initial price to gain market share quickly.
• Sales promotion is short-term incentives to encourage purchase or sales of a product or service.
• Personal selling is the personal presentation by the firm's sales force for the purpose of making sales and building customer relationships.
• Push strategy is usually followed by B2B companies with respect to promotion strategy.