In recent months, home furnishings businesses faced commercial issues due to inflation, increased interest rates, and economic worries. However, these same factors also contributed to price reductions at Ingka Group’s Ikea stores.
The largest group of Ikea retailers, Ingka Group, has reportedly concentrated on creating “a more affordable, accessible and sustainable Ikea” in order to counteract the difficulties and spark retail development.
According to Jesper Brodin, CEO of Ingka Group, “dreams and needs for a better life at home are greater than ever in these times.” Inflation and interest rates have also had an influence on people’s finances, and we aim to help individuals as much as we can during difficult times.
“Our long-term promise is to invest in lowering our prices, and this year has proven that the Ikea vision, our unity, and our entrepreneurship are resilient enough to withstand the test of time.”
The Ingka Group revealed in a press that its portion of Ikea retail sales for the fiscal year 2024 would be EUR 39.6 billion, a 5% drop from the previous year’s share of EUR 41.7 billion in FY23. According to officials, the company has made cutting prices for customers a top priority by spending more than EUR 2.1 billion in thousands of products across all countries. This approach has increased store visits by more than 3% and online visits by 28%. Online orders rose by 9% in quantity.
In addition to emphasizing reasonable prices, Ingka Group has invested over EUR 1.3 billion in expansion, digital development, and store renovations. The retailer launched 43 new stores worldwide, including plan-and-order sites in the United States and Italy in addition to new outlets in China, Japan, and Switzerland. The company launched new artificial intelligence-driven technology and fulfillment solutions, including tools for quicker pick-up and delivery, self-service digital kiosks for finding products in the stores, and demand sensing systems for improved article availability. According to officials, since the company began tracking customer happiness five years ago, the results of these efforts have produced the highest score.
Being as economical as possible is more crucial than ever, which is why we’ve committed all of our efforts and resources to bringing down our pricing. Simultaneously, we continued to invest in growing and expanding our retail company, making our current stores better than before, providing good value for money, and advancing our digital solutions and services, according to Tolga Öncü, COO of Ingka Group’s retail division.
The global franchisor of the Ikea brand, Inter Ikea Systems B.V., recently revealed that a total of EUR 45.1 billion in retail sales had been achieved by all 12 groups of franchisees. With retail operations in 31 international markets, Ingka Group accounts for 88% of total sales.
According to additional unaudited financial data, Ikea’s global market share was constant at 5.7% over the course of the year. 43 new stores were opened, and store visits increased by 3.3% to 727 million from 697 million in the fiscal year 2023.
