Ikea Enntering the Russian Market Essay

667 Words Jan 25th, 2013 3 Pages
The best way to search for viable alternative entry strategies is to watch the mistakes IKEA made and the problems they had by entering the Russian market. But first there are several company related attributes to mention. IKEA is a company which is highly related to their Swedish tradition and origin as this is a basically part of their marketing strategy and corporate identity. Many people are connecting IKEA’s Swedish image with the way IKEA is communicating their product range: Cheap, easy and yet reliable and stylish. Because of these conditions given, IKEA is forced to make sure that they are able to transfer these elements of their corporate idea into the Russian market. Of course there always are slightly differences from country …show more content…
The arrangement and adaption of the communication strategy and the product range took place steadily and needed time. Therefore, even if the Russian market potential was still growing and expanding IKEA lost market share and sales power because of wasted resources and by performing a not optimally adjusted marketing strategy.
A solution to face these problems from the start of the market entry would have been to search for a Russian partner company that is capable of IKEA’s missing knowledge. The different opportunities in here are based in the shaping and the form of alliance. IKEA can be sure that they have got a very well working business model. They don’t want to share their success even if a deeper alliance would probably allow them to share loss as well in case of failure. IKEA wants to keep control of the company as it is still private hold and they want to keep it that way in Russia. In addition a joint venture alliance usually is kind of a long term relationship. IKEA indeed just needs a partner to get started in the market Russia. Once they catch on they might want to quickly quit former alliances. In my opinion the best solution would have been a strategic alliance with a possibly quite small partner as the object of trade for IKEA is just knowledge. A small, traditional company that enables IKEA the transfer and arrangement of their culture and company

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