When the “big eyebrows and big eyes” IKEA began to “betray”, it was undoubtedly announcing to the outside that the digitalization of the home furnishing industry was an irreversible trend.
Editor’s note: This article is from the micro-channel public number “Alter chat technology” (ID: spnews), Author: Alter.
Ikea’s “Home Furnishing Guide”, which has been in business for 70 years, ended its legendary journey more than half a month ago.
Somewhat unexpectedly, there are still many foreign netizens who leave messages to IKEA on Facebook and Instagram, but the country is as calm as ever, and few media miss the release. The IKEA brochure that is comparable to “Harry Potter” naturally missed the recent hot searches on Weibo.
There are many explanations that can be given. Consumers’ attention is increasingly focused on mobile phone screens. The decline of paper publications has long been an indisputable fact. Even the 70-year-old IKEA Home Guide has failed to escape the loss of its presence. Fate.
It’s just that when the “big eyebrows and big eyes” IKEA began to “betray”, it is undoubtedly announcing to the outside world that the digitalization of the home furnishing industry is an irreversible trend.
01IKEA’s “backhand”
As to why the “Home Guide” should be discontinued, IKEA’s official statement is: a sad but sensible decision.
If you turn your eyes to 2018, you may be able to find some systematic answers. At that time, there were many keywords related to IKEA, such as global layoffs, pop-up stores, catching up with e-commerce, digital innovation centers, etc. IKEA’s new actions this year were much more frequent than in previous years.
The main reason is that the growth rate of IKEA’s operating income in the 2018 fiscal year has slowed down significantly, and its net profit has even seen a plunge.
The 75-year-old IKEA urgently needs to make some changes globally, and then formulated a three-year “transformation plan.” Especially in the Chinese market, facing a year-on-year growth of only 9.3%, Zhu Changlai from China was forced to step down as president of IKEA China, and the baton was handed over to the “firefighter” Anna Kuliga. In addition to following the original business model, Anna Kuliga proposed a “China Plan” based on IKEA’s global transformation.
At the IKEA China Strategy Conference in August 2019, Anna Kuliga played the “Future+” strategy card for the first time, mainly focusing on three aspects: diversified channels, digitalization, and home life service experts. It is announced that it will invest about 10 billion yuan in the Chinese market to establish a digital innovation center.
The directly related action is the e-commerce of IKEA:
In August 2018, IKEA officially launched a WeChat applet called “IKEA IKEA Home Furnishing Flash Store”. As an important step for IKEA to test water and e-commerce in China, IKEA officially carried out the occasional sale of IKEA limited concept suits in the form of pop-up stores in the mini program, and provided the friend gift service in the mini program, trying to use the social attributes of WeChat Turn fans into customers.
In March 2020, IKEA officially entered the Tmall flagship store and launched the official shopping app of IKEA on the same day. Different from the warmth test mentality on WeChat Mini Programs, the IKEA Tmall flagship store has put more than 3,800 products on the shelves at one go. At the same time, the membership system of IKEA’s offline physical stores is connected with the Tmall flagship store, further completing the boycott Business to actively embrace the transformation of e-commerce.
Just six months before announcing the suspension of the “Home Guide”, IKEA took advantage of the 618 promotion season to reproduce the Shanghai Baoshan store 1:1 on the Tmall flagship store. Consumers can view product styles in 360 degrees, and Sofas, coffee tables, carpets and other home furnishings can be freely matched, and AR technology can even be used to preview their real effects at home.
As the Vice President of Alibaba Tang Xing endorsed IKEA at the Ali Home Improvement Summit: “All the consumption scenarios we have experienced offline can be displayed online in a more reductive way, so that consumers can Visiting a brand’s store online, visiting IKEA is no different from visiting offline.”
At the same time, more and more IKEA “grass” content has gradually appeared on social media such as Xiaohongshu, Weibo, and WeChat accounts. 100,000+ reading volume has become IKEA’s new goal to replace beautifully bound brochures. Even the Huawei App Store has become a new venue for IKEA to connect users.
In other words, behind IKEA’s discontinuation of the “Home Guide”, there is obviously a “back-hand”, that is, to attract customers through online content marketing and try to provide users with the same experience online as offline.
02Retail pattern
If we just interpret the incentives for the suspension of the “Home Guide” from the perspective of IKEA’s e-commerce, from paper media to digital media, it is likely to “see trees” .
Ikea can be touched more than weak growth. It may be the following two sets of data:
The first is the “China Home Style Consumer Preference Insights” report released by CBNData in 2019: During the Double Eleven, Red Star Macalline and Jiaran Zhijia handed over 21.9 billion and 20.8 billion transcripts respectively;
The second is the fiscal year 2019 financial report released by the IKEA Group at the same time: throughout the fiscal year 2019, IKEA’s 28 stores in China received a total of 108 million visitors, but the cumulative sales were only 15.77 billion yuan.
Only a simple comparison of figures is needed, and it is not difficult to draw the conclusion that the annual sales of all IKEA stores in China cannot even match Red Star Macalline’s e-commerce promotion. Why did the same e-commerce transformation and the same attempt of content marketing, and the brand awareness of IKEA which is not inferior to that of Red Star Macalline, but ultimately failed to replicate the myth of the former?
The answer lies in IKEA’s early narrow understanding of digitalization. Whether it is e-commerce or digital marketing, IKEA’s starting point is to reduce its own costs, but ignores the pain points of the user side: home furnishing itself is a non-standard product, and the time cost for consumers to choose products has not been reduced because of e-commerce.
On the other hand, the digitalization process of friends such as Jiaranzhijia can actually be broken down into three steps:
The first step is the transformation of offline stores. The shopping guides of traditional stores are upgraded to digital shopping guides integrating online and offline through smart terminals such as large screens and tablets, which can lead customers to experience offline scenarios as well as online stores. Continue to attract traffic, and at the same time increase offline sales through brand cross-store joint purchases.
The second step is the optimization of the online field. Based on the LBS positioning technology, offline stores and online are bound to guide users to the nearest store for consumption; Engraving technology digitizes the “goods” and “fields” of offline stores, allowing users to “visit stores in the cloud” anytime and anywhere. Online and offline are no longer isolated scenes that are separated from each other.
The third step is to restructure the industrial chain, such as the designer ecology built by Jianran’s House and Laiping Designer, and the high-quality supply chain of Jianran’s Home and Laiping Designer’s design With the integration of teacher resources, designers can directly call the products in the database, and the connection between users and home furnishing brands further advances to diversified channels.
To make a comparison, IKEA’s digitalization level before 2020 is far less than that of Red Star Macalline and Yuranzhijia, and it is still in the classic e-commerce era. But as a “commercial idol” that influences the consumption philosophy of a generation, IKEA has never been a conservative company, but is good at grasping the laws of retail.
China’s home improvement industry has gone through the savage growth, fighting for each other, the emergence of vertical service providers, and the digital transformation of giants feeding traditional industries with traffic and technology period. In the ever-changing and hard-to-predict market changes, it is often players who survive the trend that they will digitize the front-end design, product marketing, performance services and the back-end supply chain, and then find efficient operation, low-cost operation and relatively high efficiency. The ideal state of high commercial transformation.
So there is the scene mentioned above. IKEA began to build a 3D model room in the Tmall flagship store, trying to meet the needs of young people to visit IKEA online; it began to implement the concept of city stores in the Chinese market, which is no longer like In the past, they bought land to build a shopping mall by themselves, but leased 3000 square meters of shops, and combined with digital solutions to create a new home retail experience integrating shopping, leisure and social interaction.
To be precise, the law of the retail market is the invisible hand, which not only allows Jiaranzhijia, Red Star Macalline, and home furnishing brands of all sizes to actively pursue changes, but also allows IKEA to actively jump out of its original business Logic, to create a diversified scene for consumers, that is, where the user is, IKEA should be there.
03The baptism of the times
Regardless of whether the home furnishing companies represented by IKEA are aware, the home furnishing market is undergoing a new round of baptism and gradually penetrates into the texture of home retail.
It took more than ten years for IKEA, and the number of IKEA stores only increased from 8 to 28. With the soaring domestic land prices, the copying pressure of IKEA in the offline market can be imagined. However, the radiation range of offline stores is very limited. IKEA wants to enjoy the dividends of sinking the market.Characterization is almost the only way.
As the most developed market in the global e-commerce industry, China has played a leading role in IKEA’s global transformation to a certain extent, and is even the vane of global home furnishings.
The production and sales of furniture was originally a typical regional business, but Gu’s family and Lin’s Wood have become the darlings of the e-commerce era. The monthly e-commerce sales easily exceed 100 million and will be large Small furniture is sold all over the country, completely breaking the fate of furniture manufacturers’ regional production and operation.
Home decoration design is originally a complicated manual work. Just a three-bedroom model room design, it will take the designer nearly a week. However, after the emergence of technologies such as 3D cloud rendering and AI smart model room, designers can get their own high-definition renderings as fast as 8 seconds, and the design efficiency of businesses is rapidly improving.
The disruptive changes in technology and business are far from over. China’s e-commerce giants are brewing new actions, which will greatly affect the next step of home retail.
For example, a week before IKEA stopped publishing “Home Furnishing Guide”, Ali deliberately released to the outside world the news of a major revision of Taobao. Not only will it release “walk around” to create its own content ecosystem, “guess you like” will also enter The first place on the homepage indicates that the logic of online marketing is undergoing subtle changes;
For example, the design and digital service platform represented by Laiping Designers integrated 3D technology and green screen technology for the first time during Double 11, and launched the “3D model room + live broadcast” function to help merchants and anchors in virtual The live broadcast in the three-dimensional model room is changing the customer acquisition logic of the home improvement industry;
For example, Tencent frequently throws olive branches to home furnishing companies through WeChat applets, and uses the private domain traffic in WeChat as a starting point for soliciting home furnishing companies; Jingdong is online The “Jingdongjia” channel, which is the main shopping scene, hopes to create a full chain layout from home furnishing products to circulation to installation and construction and after-sales service…
At least IKEA’s Chinese friends have preemptively proved the correctness of the comprehensive digital transformation: during Double 11 in 2020, the 100-story “Tmall Home Improvement City” will welcome More than 60 million people came to “cloud shopping”. Home improvement and home furnishing brands such as Oupai, Shangpin Zhaibao and other home improvement brands have joined KOL to plant grass in the form of “3D model room + live broadcast”. Finally, the overall transaction value of the order placed by the 3D model room is more than The 618 hours a few months ago has quadrupled.
For IKEA, discontinuing the “Home Guide” is by no means the end point. With digitalization already becoming the main theme of the times, it must either embrace the baptism of the times or be eliminated by the times. After taking the first step to embrace the digital wave, wait for theHome may be such a scene:
Ikea’s offline stores will undergo a thorough digital transformation. Customers can scan the QR code to place orders and deliver them to their homes; more and more products are re-engraved online, and offline stores are further to the logistics center Transformation; use 3D virtual live broadcast and other tools to guide the flow of people like Oupai, accelerate the integration of online and offline; at the same time, actively integrate into the designer ecology to open up the closed loop of designers, home products, and consumer experience…< /p>
04Write at the end
To borrow a view from China Business Weekly: Times has never changed the nature of business, but times always change the appearance of business.
The 77-year-old IKEA once influenced the lifestyles of those born in the 50s, 60s, 70s, 80s, etc. However, when young millennials came to buy cars, buy houses, get married and have children, their consumption habits also Influencing IKEA. Perhaps IKEA’s products will still accompany this generation of young people throughout their lives, but the channel for communication with each other will never be just the “big blue box” located in the suburbs of cities, but hidden in consumers’ mobile phones.