(image from www.ikea.

com)

IKEA Marketing Plan

Casey Rowe

I. Executive Summary
IKEA has shown through its market share and profitability that it is a leader in the home furnishings industry. Aside from being an industry forerunner, IKEA also upholds a great reputation and brand image despite its few (37) retail locations in the United States. The company sets itself apart from competitors with its wide product range, offering customers almost everything under one roof to furnish and decorate any space. In order to achieve the objectives that focus on reaching a greater percentage of our target audience, increasing online sales and retaining customers, we present this integrated marketing plan to illustrate what tactics we will use to implement specific campaigns. This plan also provides further details about our unique media and public relations tactics, sales promotions and direct marketing strategies that will help obtain our goals and objectives. The objectives and strategies were developed to address specific strengths and weaknesses of the IKEA brand and company. From there, we also recognized opportunities for IKEA to grow within its target audience and propose individual ways to implement each of these growth tactics. Boosting online sales and nurturing the rapport we have with our customers to increase brand recognition are top priorities in this plan. Included in our $20 million budget is traditional advertising, but to execute an effective IMC campaign, we also use budget-friendly digital mediums like relatively new social media channels to open a direct line of communication with our customers. In the following year, we hope to reach out to customers more effectively with our marketing mix that includes both traditional and non-traditional advertising as well as compelling campaigns that will promote buzz and relationship building. As a result, IKEA will gain both sales and loyalty from new and existing customers.

Table of Contents

I. II. III. IV. V. VI. VII.

VIII. IX.

X.

XI.

XII.

XIII. XIV.

Executive Summary ........................................................................ 2 Background Information ............................................................... 4-5 Product Range and Distribution ................................................ 5 Target Audience .......................................................................... 5-6 SWOT Analysis ............................................................................... 6 Marketing Objectives and Strategies .................................................. 7 Integrated Creative Strategy & Creative Brief .................................. 7-8 Media Objectives, Strategies, Tactics & Budget Allocation ................. 8-11 Media Objectives & Strategies ................................................. 8 Budget Allocation ................................................................ 8-9 Media Tactics .................................................................... 9-11 i. Broadcast/Network ....................................................... 9 ii. Print ....................................................................... 9-10 iii. Outdoor ..................................................................... 10 iv. Digital .................................................................. 10-11 Flow Chart .................................................................................... 11 Sales Promotions ...................................................................... 11-13 IKEA Outing Day ........................................................... 11-12 IKEA Click .................................................................... 12-13 Public Relations ........................................................................ 13-15 Reduce Carbon Footprint ................................................... 13-14 TV Sponsorship .................................................................... 14 Localized Special Events ................................................... 14-15 Direct Marketing ....................................................................... 15-16 Postcard .............................................................................. 15 E-mail ............................................................................ 15-16 Newsletter ........................................................................... 16 Measurement and Evaluation Plan ............................................... 16-17 Omniture ............................................................................. 16 Measurement with Numbers .............................................. 16-17 Shopper Trak ....................................................................... 17 Conclusion .................................................................................... 17 References ................................................................................... 18

II. Background Information

Ingvar Kamprad first launched his own furniture company at 17 years of age, operating on the concept of meeting needs with products at reduced prices (History, 2009). Six years after starting this small, makeshift mail-order service, Kamprad developed the first IKEA catalog to create sales on a bigger scale, while trying to maintain the companys original mission of offering high quality products at low costs. Shortly after, in 1954, IKEAs first store was launched in Sweden. The actual IKEA concept first took shape in the midst of the 1960s. IKEA was in the process of opening new stores and in the development stages of its most innovative and well-known products of today, including the PONG chair and BILLY bookcase. Both have been IKEA staples since day one, and are made from the ground-breaking material IKEA is known for particle board, an inexpensive, hard-wearing and easy-to-process material that went along with IKEAs practicality and low price mentality (History, 2009).

(PONG chair)
(images from www.ikea.com)

(BILLY bookcase)

The1980s was a thriving era for the company. IKEA was starting to branch out into new international markets that included the United States, Italy, France and United Kingdom. During this time, the company also went green and vowed to be environmentally conscious of its products, requiring them to be safe from both a health and environment perspective. This was all while launching a new range of products for its childrens line. By 1984, IKEA was present in 16 countries (over 167 stores), and the IKEA catalog print run had expanded to 45 million copies in nine languages. Since then, more classics have been introduced to the IKEA product lines that have continued to wow its customers (History, 2009). Recently, IKEA adopted a code of conduct called The IKEA Way on Purchasing Home Furnishing Products (IWAY), specifying exactly what IKEA expects from its suppliers and what they should expect from the company. These expectations include legal requirements, working conditions, active prevention of child labor, external environment and forestry management all essential components to IKEAs overall mission. The company also dedicates itself to implementing high standards when it comes to people and the environment, products and materials, climate change, social initiatives, partnerships and the never ending list of improvements IKEA is continuously working toward (The IKEA Way, 2009).

The current IKEA mission encompasses a mix of visions and statements, stating (2009), The IKEA vision is to create a better everyday life for the many people. Our business idea is To offer a wide range of well designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them." Our market positioning statement is "Your partner in better living. We do our part, you do yours. Together we save money. Product Range and Distribution As Kamprad envisioned, IKEA still operates with the meeting needs with products at reduced prices point of view. Products are designed around a price while maintaining style, wide range of functionality and innovation. According to IKEAs Web site, you'll find everything you need to furnish your home, from plants and living room furnishings to toys and whole kitchens (The IKEA way, 2009). With low price in mind from the beginning stages of development, a design is created by considering the low-cost options as a whole the materials used, labor, and shipping. Also, the flat packing IKEA implements in its early design stages is essential to the economicallyfriendly and inexpensive end product. The core element of every product is functionality. One of IKEAs goals is to lower prices each year, and is often successful. IKEAs website homepage flashes top-selling products with current respective prices compared to the previous year. Specifically, IKEAs range of around 9,500 products can range anywhere from a $1 decorative accessory to a $2,999 gas range (Our product range, 2009). Most importantly, IKEA presents these products to consumers in a way that lets them envision various designs through room sets furnished with IKEA products. Shoppers must pass through these massive, furnished displays before they are able to collect their furniture choices from the warehouse, proceed to checkout, and take home the product to assemble. According to IKEA, it has control of 28 distribution centers and 11 customer distribution centers in 16 countries. Using flat packs, transporting goods where possible by rail and sea, and utilizing fuel-saving techniques allows us to be cost-effective and environmentally friendly (Facts and figures, 2009).

III. Target Audience

The demographics and psychographics of IKEAs target audience includes but is not limited to, both age groups of 18 to 34 and 35 to 49 years, but mostly a unisex mix of college or post-graduate aged individuals typically living in metropolitan and urban college areas. These age groups encompass both the younger, educated students as well as the young adult professionals. Their salaries range anywhere from $15,000 to $50,000 and they usually allocate this money to update their computers, PDAs and mobile devices. Hence, this audience usually includes early adapters of technology who travel abroad, take risks and have a transient lifestyle that may require them to move often, most likely from apartment to apartment, or perhaps upgrading from an apartment to a new condo or small home. The result of this lifestyle makes them first-time furniture shoppers. Their modest income usually indicates a modest choice of extras, influencing their vehicle choices and clothing shopping habits. This audience may drive moderately priced, but 5

perhaps a trendy and practical Camry, Mazda or Volkswagen (unless they utilize public transportation, and take the train or metro). They also tend to dress casually and shop for both business and social gatherings, because theyre usually trying to balance new jobs and having fun. However, their budget requires them to shop at community center or regional type malls and outlet centers, as opposed to high-end boutiques and specialty fashion centers. These shoppers are most likely down-to-earth, laid back and/or creative and artistic. Theyre also considered somewhat fashionable and trendy, yet thrifty. This target audience contains individuals who have a limited attention span and want to be instantly gratified. They want to do things themselves (embracing the do-it-yourself attitude of IKEA), and care about the environment. The values of this audience are so compelling, they are willing to travel long distances to shop at IKEA maybe because of their concern for the environment or because of the cost-conscious products that are exclusive and exotic to IKEA. An additional segment of IKEAs target audience is budget-conscious families most likely getting ready to branch into a more domestic way of life. These families have usually 0 2 children, but still encompass similar characteristics, lifestyles and habits of the rest of IKEAs target audience.

IV. SWOT Analysis

Strengths 1) Reputation, for products and company itself (internally & externally) 2) Cost and competitive advantage 3) The IKEA in-store experience 4) Employee satisfaction 5) Large catalog reach Weaknesses 1) Assembly difficult for older adults/frequent movers 2) Comfort and quality versus low-cost 3) Ability to implement controls on a store-to-store basis instead of globally 4) The designs dont appeal to everyone (not everyone prefers minimalism)

Opportunities 1) 2) 3) 4) 5) Smaller stores More stores in United States Capitalize on GREEN efforts Expand online shopping Add bonus/rewards services to increase customer satisfaction

Threats 1) Competitors, both high-end and smaller retailers 2) Economy rising, causing customers to shop at higher-priced retail stores 3) Staying profitable while continually dropping prices 4) Shipping efficacy and cost

V. Marketing Objectives and Strategies

Marketing Objectives
Achieve a 75 percent customer awareness of our brand in target markets Obtain 3 percent increase in total sales for FY10 Increase online sales by 3 percent

Marketing Strategies
Continue to provide high level of customer service to existing and potential customers Expand direct marketing in smaller towns outside of cities where stores are located Develop in-store promotions for out-of-towners Offer discounts or savings plan for those who shop loyally through catalogue or online Market larger, higher-priced items more heavily than smaller, cheaper items

VI. Integrated Creative Strategy & Creative Brief

Strategy Statement
Weve put the FUN in functional furnishings.

Creative Brief
Client: IKEA Type: Magazine Ad Pages: 1 _________________________________________________________________ Why are we advertising? To gain a broader customer base and increase product loyalty of current customers. Whom are we talking to? To IKEAs current customers, including first-time furniture buyers and those looking for apartment and/or home furnishings that are low-cost initially but can achieve the longlasting value that high-end furniture provides. What do they currently think? IKEA furniture is only for 20-somethings, tends to be trendy, and consists of low-quality materials. What would we like them to think? IKEA offers durable, products that are appealing and beneficial regardless of individual wants and needs. We also have a wider range of options than any other furniture store that will surpass the test of time. What is the single most persuasive idea we can convey? Our furniture is better priced and has the best functionality.

Why should they believe it? IKEA has price and quality traditions unlike anyone else. We can prove our products last. Are there any creative guidelines? Four-color, full-bleed gatefold.

VII. Media Objectives, Strategies, Tactics & Budget Allocation

Media Objectives
Reach 50 percent of the target audience five times in a four month period. Obtain a 5 percent increase in Web site hits in a 12 month period.

Media Strategies
Create a digital marketing team to implement and monitor digital and social media ventures (e.g. create Facebook, Flickr and Twitter accounts, as well as a corporate blog) Provide detailed and entertaining company and product information in all online media channels Start a short-term TV blitz during primetime and on Sundays scheduled around key months in IKEAs fiscal year Strategically place billboards in regions saturated with IKEAs

Budget allocation - $20 million

This budget estimate is for a year-long period of national brand and Web site awareness advertising starting September 1, 2010 through August 31, 2011, to run parallel with IKEAs fiscal year. This advertising plan will include placement in broadcast television, network television, magazines, billboards, and online ad placement, to target adults 18 49 years of age. Broadcast television and magazine placement will be flighted in four-month periods, to more effectively advertise during the release of IKEAs annual catalog and new merchandise in early fall. Another four-month period of advertising will take place in spring (print only), when our audience is more likely to be planning on making home improvements or changing seasonal dcor. Digital and interactive media, including online ad placement will be implemented year-round because of its cost-effectiveness and potential to reach most of our target audience. I predict this media outlet will attract more people to our Web site. These tactics go along with the execution of social media channels to further establish IKEAs online presence and generate a high volume of word-of-mouth advertising.

Broadcast/Network Network Cable Print Magazines Outdoor Billboards Digital/Interactive Banner ads Online publications Social sites

35%

20% 15% 30%

Media Tactics
Broadcast Broadcast television provides an important visual element needed to enforce a message and leave an emotional impression. To reach the target audience of 18 49, I recommend placement in primetime and Sunday night programming. Because CBS has topped all other networks for the past six years in number of viewers, I suggest placing commercials in primetime spots on this network. I would also place commercial advertisements on FOX, who in the 2009-2010 year almost tied CBS in viewership numbers. This combination of (5) 30-second spots every other week, July through October would ensure high reach and frequency. The flighted schedule will run Monday through Sunday, 8 p.m. to 11 p.m. 20 percent of overall broadcast budget would be allocated toward these networks: CBS and FOX With these networks, there is the potential to reach at least 5 million viewers per spot and 6 million viewers on primetime Sundays Network To supplement the broadcast television schedule, I also recommend placing (10) 30-second commercial spots to run weekly, per channel, across cable television. HGTV, ESPN and E! Entertainment contain programs that cater to our target audience. The flighted schedule will run Monday through Sunday, 8 p.m. to 11 p.m., also July through October. 15 percent of overall broadcast budget would be allocated toward these cable channels: HGTV, BRAVO and ESPN Placement on HGTV would reach members of our transient target market, as nine of its top-10-rated shows among the 25- to 54-year-olds are real estate-based. Research says BRAVO delivers the top three most attentively viewed reality shows on TV, is the top cable network for brand recall and the top network for improving brand opinion, so placing spots during any of these three reality shows would be ideal. ESPN will successfully reach out to our male market. Print Because of its longevity and large reach, I recommend placing double page spread, fullbleed ads in People, Sports Illustrated and Better Homes and Gardens. Cost would be split among the three magazines, totaling 20 percent of IKEAs overall budget. During the four month advertising periods (July through October and March through June), I suggest running ads two times per month in People, potentially reaching 27 percent of our target 9

audience per advertisement. One ad monthly would be in Sports Illustrated and Better Homes and Gardens, whose readers total 20 percent of our target market, men and women, 18 49 years of age. Outdoor/Billboard For this media plan, billboards provide the perfect opportunity to reach audiences traveling through or living in a specific market. This type of targeted coverage placed strategically around IKEA locations and nearby highways will capture the audiences attention. A total of 20 highly visible billboards will be secured in locations along the East and West Coasts, northern Florida and eastern Texas. Placement of outdoor ads (billboards) will be as follows:

# of Billboards

Location/Interstate
L.A., California area Interstate 5 and 405 Houston, eastern Texas area Interstate 610 Northern Florida Intersection of Interstates 10 and 95 New England Interstate 81 and 95

Daily Traffic (approx.)

350,000

250,000

80,000 - 100,000

250,000

Digital/Interactive Internet advertising is the most important facet of this media plan. More than 75 percent of all households have Internet access and 70 percent of adults use the Internet. Online advertising is affordable to run year round, and gives the opportunity to provide direct association with highly respected Web sites that reach the target audience. Banner ads purchased through Microsoft Ad Network will allow advertisements to be placed according to profile and behavioral targeting directly on high-traffic sites such as Facebook, Digg, Zune and Windows Live Sharing and will account for 30 percent of the overall budget. I plan to piggy-back these tactics with the implementation of social media channels run by the digital marketing team. These team members will be responsible for updating and creating information to stream frequently through the specified channels. Microsoft Ad Network is a way to purchase online advertising that will place ads on Web sites most beneficial to IKEA, based on several demographics. This mix of banner placement has the potential reach millions. Creating a company blog directly from IKEAs Web site, to be updated at least three times per week, will provide interactivity that IKEAs customers want. Bloggers make up 63 percent of IKEAs target audience and spend close to nine hours per week blogging.

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Creating profiles on Facebook, perhaps for every U.S. location would be beneficial to customers in specific regions. Click-through rates for content on Facebook pages walls are estimated to be as much as 6.5 percent. The creation of an IKEA Flickr account, an online photo sharing site, would allow those directly interested in the IKEA brand to view pictures of sample rooms, vignettes not in stores, etc. tagged geographically and categorically. Flickr is also a great medium for video aggregation, where IKEA can upload videos containing any kind of content including advertising, and would put IKEA among an estimated 300,000 users. An IKEA twitter will send micro-blogs to millions of followers multiple times a day. I see using this social media channel to entertain and inform our target audience about the IKEA brand more frequently than any other social media channel.

VIII. Media Flow Chart

IX. Sales Promotions

Sales Promotion Objective 1
Stimulate a 20 percent increase in demand of a geographically targeted audience

Tactic 1 Specialties (with a coupon) IKEA Outing Day In order to motivate consumers, especially the out-of-towners that IKEA needs to capitalize on sales and counteract IKEAs small number of retail locations, it is necessary to reward new IKEA customers and give them a compelling reason to come back. To get this result, offering a free incentive from a specialty sales promotion is essential. This specialty is given free to customers and works to keep the IKEA brand and experience fresh new (or

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existing) customers minds. The type of incentive I am proposing would give people the inclination to travel to an IKEA store and to come back at least a second time. This tactic would include a biannual sales promotion that takes place one day every two quarters and targets those who live over 60 miles away from an IKEA retail location. The promotion is 25 percent-off all purchases during the shoppers current visit and an additional 25 percent-off coupon redeemable for their second visit. The second coupon would be valid an entire year before its expiration date and would only require an initial merchandise total of $100, eliciting an added value to customers while ensuring IKEA profits from the incentive at the same time. The time frame of the year-long coupon gives the customer plenty of opportunities to make it back once more, yet is small enough to reduce the likelihood of the customer forgetting about the incentive or second trip altogether. An additional perk of this specialty is the probability the customer will spend more than $100 even after the discount. Both days the sales promotion is implemented could be referred and marketed as an IKEA Outing Day. These designated days give those who live further distances from IKEA the opportunity to plan their trip in advance, making the sales promotion convenient for customers and profitable for the company. As not to leave out IKEAs current loyal and nearby customers, perhaps a small discount could be provided to locals during an Outing Day. To prove the customers distance from the store, IKEA could ask that the customer bring with them a printed Mapquest set of directions matching the town on their ID to be shown at checkout. (They may have had to do this already in preparation for their trip!) An alternative to subjecting the customer to doing the work themselves, the customer could instead show their ID to an IKEA office employee prior to checking-out, handing over the job to IKEA staff.

Sales Promotion Objective 2

Increase online sales by 3 percent through brand reinforcement.

Tactic 2 Loyalty Program IKEA Click A sales promotion that would benefit IKEAs target audience and increase online sales is a solid, online loyalty program. Just because someone doesnt have an IKEA store one, two or even three towns away would not mean they couldnt benefit from special deals and offers through what IKEA could present in an online loyalty program. The shoppers who visit actual retail locations more frequently would also be able to benefit, by ordering online more often and saving themselves time and money. I am proposing the loyalty program called IKEA Click, focused not only around savings, rewards and special offers, but free shipping. A customer must sign up online with a username to become a member and receive rewards. Special offers would include discounts offered only to members and only for shopping online. Members would also have primary access to information regarding in-store specials and other discounts, encouraging them visit an IKEA store (where they are likely to spend more money). This loyalty program would specifically give all IKEA products a set amount of points depending on the price and type of product, to be given to members for their purchases. After acquiring a certain amount of points, a $50 gift card would be awarded to the customer for their online purchasing loyalty. To execute free shipping as an incentive of this 12

loyalty program, it would only be offered with a minimum purchase of $150. Otherwise, free shipping could cause IKEA to possibly incur unwanted expenses. The online customer loyalty program would give IKEA the best long-term customer satisfaction by providing the benefits and rewards that people really want in such a program. The free shipping alone would entice IKEA shoppers and non-IKEA shoppers to sign up. Although some may argue that free shipping could create a financial dilemma for the company, by working out deals with IKEA product manufacturers and shipping companies (UPS or Fed-Ex), costs on IKEAs behalf could be reduced. Additionally, profits from increased online purchases by members would cover or outweigh any expenses that result from the free shipping. The following are data compiled by Linda Buestos provided to show just how free shipping alone can retain and reward IKEA shoppers: 61 percent of online shoppers prefer to shop with a retailer that offers free shipping 43 percent of shoppers abandon their shopping carts because of unexpectedly high shipping charges 60 percent claim free shipping is a reason they are more likely to shop online. 90 percent believe free shipping offers would entice them to spend more online (2009)

IKEA would also be able to use shopping statistics and data as well as demographic information from IKEA Click members and Outing Day participants (compiled automatically into a database) to direct future marketing and obtain feedback regarding products for development purposes. All around, these promotions are great programs for both customers and the company. IKEA Outing Days and IKEA Click would retain and attract customers while simultaneously building and nurturing the relationships necessary to create long-term revenue.

X. Public Relations
PR Objectives
Improve relationships with IKEA target audience by showing the reduction of our carbon footprint through the reduction in production of 25 million catalogs for FY11 Increase IKEA brand awareness by 25 percent in adults 24 49 years of age Generate awareness through publicity measured by a goal of at least 10 major news outlets

Tactic 1 Reduce production of IKEA catalogs significantly Currently, IKEA spends 70 percent of its entire marketing budget on the catalog alone. In 2008, this equated to the production of around 110 million catalogs world-wide three times higher than that of the Bible (Student Info, 2009). IKEA prides itself on using the smallest amount of resources possible, yet this information could potentially raise questions in customers, competitors and stakeholders minds. Cutting the production of catalogs not only reduces IKEAs carbon footprint (even if the current production methods are

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environmentally friendly), but would save a significant amount of money to be used toward other marketing efforts. To decrease production, IKEA could distribute its catalogs on a need-only basis. Based on past statistics, IKEA could get an estimate on how many catalogs to produce initially and dispense the rest to customers by request only. Reducing the amount of catalog manufacturing would save a large amount of money, and IKEA could use this opportunity to drive more of its customers to the Web site for PDF versions of the catalog(s). IKEA could announce this initiative through social media channels to get the word out, and ask customers to join them in the effort in reducing the overall global footprint. I think IKEAs target audience would commend IKEA for the invitation to participate and be more than willing to help execute this strategy. As a result, much buzz would be generated across blogs and fan pages. Tactic 2 Sponsor ABCs Extreme Makeover: Home Edition and/or HGTVs Design on a Dime The potential for publicity from the sponsorship of one or both of these programs could be huge. Extreme Makeover: Home Edition is an emotional program, parallel with IKEAs outlook on community responsibility and its mission. The donation of furniture, along with several name drops from Ty Pennington and IKEA logos shown throughout the show would provide a positive image for IKEA and would elicit a positive perception from viewers. Sponsorship of an episode would impact viewers who are keen of the shows assignments, of providing poverty-stricken families who are usually selflessly involved with charitable organizations or who have started one of their own with a brand new home. TV Guide lists Extreme Makeover: Home Edition on the Sunday TV hot list (2010), which would ensure a large number of people would be exposed to the sponsorship. An even better opportunity would be to sponsor HGTVs Design on a Dime. According to HGTVs Web site, Design on a Dime makes over a space for design-conscious home dwellers who want lots of style but may not have lots of money for the project. With a budget of $1,000, a design team tackles a problem area such as a boring bedroom, lackluster living room, cluttered dining room or outdated office space (HGTV, 2010). The description of the show alone is a perfect match for IKEAs target audience. If it were made known IKEA furnished the entire transformation, many people could be exposed to the stylish and functional as well as low-cost furnishings that IKEA has to offer. It would also show viewers how they can decorate an entire room, top to bottom, for under $1,000 with IKEA products minus the paint. Design on a Dime would be the best way to reach the target audience, who are looking for remodeling ideas, or perhaps those who are just watching and, as a result, feel the desire to shop at IKEA because of the incredible renovation theyve seen on the program. Tactic 3 Localized Special Events A special event aimed at children, focusing on IKEAs dedication to family, is a great way to generate publicity and execute image building public relations. Each IKEA across the United States would be responsible for each event and to stimulate community involvement on its own. IKEA should require each individual store to hold some type of kid-friendly event (at least) once every two months. These events aimed at children may include face painting, musical performances by local (kid-friendly) artists, characters in costume (relevant to each location), balloon artists, Jupiter Jumps, etc. Allowing each separate IKEA to organize its own events is the most effective way to reach out to community members in each area and provide the most relevant type of entertainment for the entire family. These events would 14

show everyone from an IKEA neighborhood that experience is as high on IKEAs list as profits and sales. All of the proposed PR tactics are focused on and would affect both internal and external audiences. These tactics would also be implemented with accompanying press releases and media kits to inform the media and hopefully generate articles and buzz across various mediums. Aside from giving news leads to the media, IKEA must announce every effort and event through social media channels including Facebook, Twitter and its corporate blog to induce buzz across the Web and encourage other IKEA fans to blog about these tactics, as well. These bloggers not affiliated with IKEA could potentially provide (positive) reviews, descriptions of how they were satisfied with a certain event/program and encouragement for others to watch or participate across. This publicity via the Web would result in the maximum amount of buzz and media hype.

XI. Direct Marketing

Direct Marketing Objective 1
Inform existing and non-existing customers of bi-annual clearance.

Tactic 1 Direct Mail postcard To execute this objective, I propose that IKEA use some sort of national database to send out a postcard-like direct mail piece that would reach both existing and non-existing consumers. The postcard would serve as a reminder for the two clearances that take place each year at IKEA, to get rid of the previous seasons merchandise. Not only would the postcard serve this purpose, but once shoppers get to IKEA, the clearance itself would increase the likelihood of them entering the store to shop around and purchase regularly priced items. The back of this postcard could also include a small discount for the regularly priced merchandise, giving the customer an even greater incentive to extend their shopping inside, aside from the bi-annual outdoor clearance event. I think the postcard serving as a reminder would make the recipient feel like they werent just being marketed to, but that IKEA was really trying to help them get a great deal. This feeling would result in a much better response from new or current IKEA shoppers.

Direct Marketing Objective 2

Stimulate repeat purchases from existing customers

Tactic 2 E-mail direct marketing Through an e-mail database that would provide customers with bi-monthly special offers or product spotlights from store to store, IKEA could connect virtually with its existing customers to encourage current shoppers come back to IKEA and purchase more products. Every cashier at IKEA would be required to ask each customer their e-mail address as theyre checking out. Those who provide IKEA with their e-mail address are put into a database, and would receive two e-mails a month, directed by each stores management team, providing these customers with details for their local stores special events, sales events, etc. The material provided in the e-mails would be catered to each stores customers geographically, that way, more people are aware of things going on at their local (or nearest) IKEA store, and could plan to attend special events or sign up for workshops that some stores provide. As an incentive for the customer providing IKEA with their e-mail address, IKEA can enter the e-mails in a raffle-style drawing for the opportunity to win an 15

exciting, high-priced item. Or, instead of offering an IKEA item as a prize, IKEA could give its customers the chance to win a cruise for two, instead.

Direct Marketing Objective 3

Provide an increased sense of personalized communication between IKEA and its customers

Tactic 3 Personalized newsletter As a way to make a frequent, valued IKEA customer experience even more fulfillment from the company, I propose that IKEA send out a quarterly, personalized newsletter to each customer based on their shopping habits. As cashiers gather addresses from those interested, and eventually build a large database of these shoppers, IKEA could send newsletters specialized to each customer based on the majority of their in-store buying habits. If someone mostly buys baby/children items in a certain time period, they would receive a newsletter containing tips, entertaining stories and information or deals on IKEA products that quarter. If someone else mostly buys storage items, they would receive the newsletter that primarily focuses on storage tips, pictures and ideas as well as IKEA product examples, for perhaps their next trip to IKEA. I think this would resonate well with faithful IKEA customers, making them feel as if IKEA is listening to their wants and needs. By also providing them with something entertaining and useful to read and look forward to every few months, these customers would be more likely to stay loyal to IKEA in the long-run.

XII. Measurement and Evaluation Plan

The measurement and evaluation of PR and media tactics, direct marketing and sales promotions included in the marketing plan is essential to ensure that the suggested strategies reach their maximum effectiveness. Measurements are also necessary to pinpoint flaws or unsuccessful marketing approaches. There are several methods to evaluate the ideas throughout this plan, but the following three would be the most accurate methods of measurement: Omniture Omniture is a Web analytics software program from Adobe that measures buzz, word of mouth and other qualitative data found about IKEA throughout the Internet. It picks up on keywords and uses other data-mining techniques to collect what people are saying about a company online. Omniture would be a great way for IKEA to measure generalized information on what customers think about sales promotions and events or criticism regarding a marketing approach. High amounts of positive feedback would be indicators of success in this situation. Measurement with Numbers E-mail, coupons and catalog requests would all be best measured by an actual number of participants. Through computers and other data entry systems, such as scanners or other electronic devices, IKEA could directly measure the outcome and number of participants of specific tactics like the IKEA Click online loyalty program. The quantitative data directly obtained from the scanning of coupons could be also verified and in turn, show whether or not a coupon achieved the percentage of involvement from the initial objectives. Other direct numbers, such as direct Web site hits and percentage increase in sales will directly tell whether or not the execution was effective. Reach of e-mail blasts as direct marketing 16

can also be determined this way. Obviously, the higher the number of hits, etc., the better indicator of success. Shopper Trak For tactics included in the marketing plan like the IKEA Outing Day or localized special events for children, Shopper Trak could be an effective way to evaluate such promotions at point of sale. With this development, sensors are placed throughout the store for tracking whether a customer is coming or going and gauging traffic patterns. Shopper Trak even calculates the height of a shopper to determine if the person is a child or an adult. This tracking tool would indicate success through a high traffic volume reading. These results could also be used toward planning future in-store promotions and events with information received from traffic patterns, letting the marketer know the best placement of products to produce the most purchases. In addition to these three specific methods, exposure ratings from Neilsen would also be a tool to measure effectiveness of TV spots and commercials, as well as the TV show sponsorships. A high frequency, reach and GRP would indicate their success. IKEA should also keep track of sales during promotional periods and non-promotional periods in general, for direct comparison of change. Using all of these posttests along with thorough research beforehand, IKEA is likely to see great results from the evaluations.

XIII. Conclusion
With respect to the marketing mix and other marketing strategies, this comprehensive integrated marketing communications (IMC) plan effectively creates a line of communication between IKEA and its target audience. True IKEA fans, regular customers and potential customers all become part of the design that encourages interactivity and loyalty to IKEA through the marketing efforts that have been provided. Through traditional and non-traditional advertising, unique sales promotions and direct marketing, as well as PR and media tactics, this plan effectively creates the synergy necessary for well designed and efficient IMC as a total package. This combination of tactics, strategies and ways to enhance brand awareness all play a role in communicating with clarity, consistency and maximum impact, all essential in a successful integrated marketing communications plan.

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