The business world offers lessons on how best companies can strategize to increase market penetration. Businesses are working to increase their profits through sales, and thus the need to study customer behavior. With increased competition and preference for products in the market, customer experience and satisfaction remains among the critical factors that facilitate an increase in market share. As companies try to meet their objectives, there are issues such as the culture of the people, customer behavior, and innovation. The organization needs to curate the business model to suit the desired market. IKEA is a recognized brand that has established itself as a furniture store providing cheap products. While there is positive reception of the products in other countries, there is a challenge in China. IKEA has used a diverse business model to ensure that the consumers in China get the products needed. Businesses need to understand some of these approaches since they are critical when addressing the concerns of consumers. This paper, therefore, seeks to discuss the influence of cultural values, how to overcome consumer discomfort and diverse forms of innovation by using the example of IKEA operations in the Chinese market.
Cultural Values, Individualism, and Collectivism
IKEA’s operation in Asia meets a market that has upcoming individualistic young consumers and those who believe in collectiveness. Globalization has contributed to individualistic behavior, which is marked by thinking of oneself rather than a community. Most of the Asian communities were dominated by communism which is an example of collectivism and involves an approach of interdependence (Mothersbaugh, 2019). Contrary to the principles of their fathers, there is a young and growing population that is individualistic and values personal independence. The one-child policy in China has made the parents focus on the well-being of their children until their influence translates to the future direction of the coming generation. Consumer behavior in the United States of America does not center on children. Thus, they need to have the freedom to shop for what they want. According to Mothersbaugh et al. (2019), parents in Asia are keen on the practices their children get involved in, and this has led to a difference in consumer behavior.
Businesses like IKEA need to understand the best business models when approaching markets with distinct behavior. In India, Walmart stores have U and C-shaped aisles to provide families with privacy while shopping since they value collectivism. The western media has also influenced the culture of the population since the controlled westernized entertainment dwells on individualistic consumer behavior (Al-Zghool, 2020). While people think about themselves while approaching life, there are families who rely on their children and focus on their well-being. This means that children in Asian communities are influenced by their parents when shopping. Also, it has been a cultural value for children in Asian communities such as China to be part of the community. The culture influences the behavior of the children since there are several lessons offered that are the principles assimilated in life.
The critical nature of conducting market research before exploring and investing in new markets is vital for businesses since market behaviors might need comprehension. Market reception is a factor to consider in businesses and relates to consumer behavior. The rise of individualism amongst the young population might alter cultural practices and consumer behavior, thus the need to change business models to suit the new market (Mothersbaugh 2019, p41). When there is a change in consumer behavior, it means that the organization providing products and services must adapt to the evolving market trends to stay relevant.
Culture is essential since it describes the reason for a specified behavior. While cultural values are dominant in people’s lives, there is a need to understand that human behaviors are learned rather than innate due to globalization. Several upcoming behaviors might differ from cultural values. People are assimilating systems that are welcomed in other westernized environments and appreciating the need for diversity. The young population, which is becoming individualistic, can buy their own products without the influence of their parents, thus altering consumer behavior (Mothersbaugh et al. 2019, p41). According to Mothersbaugh et al. (2019, p45), more women in countries such as Saudi Arabia and Japan are taking corporate roles, making them more independent. This facilitates individual decision-making rather than the traditional collective format.
How IKEA Deals With Hard-to-Change Customers
As depicted, cultural values are a part of the tradition. The business model IKEA uses allows consumers to buy packed products and self-assemble them at home since instructions are attached. Among different cultures, Britain and China are deeply rooted in culture to the extent that they are less comfortable when dealing with new situations. Other counties in such a category include the United States of America and Korea. Tradition and cultural practices depict how people behave and approach life situations (Mothersbaugh 2019, p45). They tend to acknowledge the need to have a flexible and dynamic mind when thinking about the challenges in life. In research, it was found that Koreans and Chinese are adapting to the changes in tradition as they embrace modernism.
Technology usage in Asian countries has influenced consumer behavior as most of the content is controlled by western media. This means that modernism is parallel to the culture of the western population. Reception and acceptance of new products in the market is a factor to confide in business, and it relates to the traditions of people. As the mentioned countries are hindrances to the ability to adapt to the new market ends, IKEA has been able to overcome such discomfort through conducting market research and using various means of media to convince the audience about their products (Mothersbaugh et al. 2019, p249). IKEA has magazines that offer a catalog of products to convince the pole of the products and how they are assembled. The practice is also made available in the media as the consumption of technology is high in Asia.
Type of Innovation IKEA Uses
The type of innovation where IKEA uses flat-packed products for consumers to assemble themselves at their comfort is dynamic continuous innovation. This type of innovation is one where there is the development of new products distinct and peculiar from products available in the market (Mothersbaugh et al. 2019, p243). When people buy and assemble for themselves, consumerism stays the same since it encourages the practice of being part of the development. According to Steiber and Alange (2013), continuous innovation involves a minor change in consumer behavior.
Since consumer behaviors were rooted in culture and tradition, IKEA needed to incorporate a continuous innovation strategy. Altering the behavior of the consumers is an unsuited yet unrecommended approach which might lead to negative audience reception. For IKEA to attain the right reception and have a market share that makes the business viable, the type of innovation model required needed to have moderate changes in important consumer behavior. Some practices may be of low importance to the consumer; thus, the innovation utilizes this gap to penetrate the market.
In conclusion, cultural values have evolved and changed consumer behavior. The rise of individualism amongst the population, where conservative and collectivism were paramount, has prompted the need to strategize and have an approach to the market. IKEA has been researching and trying to gain an advantage through the media to penetrate the Asian market. The traditional barriers offer discomfort in product reception, thus the need to use innovation to increase sales. The type of innovation where there is a moderate change in consumer behavior is dynamic continuous innovation, and IKEA has been using it to gain market share in Asian markets.
References
Al-Zghool, M. (2020) An evaluation of IKEA’s global position and marketing standing.
https://www.researchgate.net/profile/Mohammed-Alzghool/publication/346059671_An_evaluation_of_IKEA’s_global_position_and_marketing_standing/links/5fb94628458515b7975d11a8/An-evaluation-of-IKEAs-global-position-and-marketing-standing.pdf
Mothersbaugh D. L. Hawkins D. I. & Kleiser S. B. (2019). Consumer behavior : building marketing strategy (14th ed.). McGraw-Hill Higher Education. Retrieved January 6 2023 from https://online.vitalsource.com/books/9781260158182
Steiber, A. and Alänge, S. (2013), “A corporate system for continuous innovation: the case of Google Inc.”, European Journal of Innovation Management, Vol. 16 No. 2, pp. 243-264. https://doi.org/10.1108/14601061311324566
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