Ikea Takes Aim at Expansion, Uses Amazon as a Model

February 15, 2019         By: Steven Anderson

“Everyone has a home. But if you don’t have a home, you can buy one there.” That’s part of the lyrics for Jonathan Coulton’s “Ikea,” a song celebrating the Swedish furniture chain that has recently made some expansions into the worldwide market. Now, it’s got a new target, and perhaps a target ambitious enough to be worthy of its Viking roots: to become the “Amazon of furniture.”

To accomplish this goal, Ikea is setting up a third-party website that will sell not only its own products, but also furniture made by competitors. Thus, it will operate much the same way Amazon does, but with an exclusive focus on furniture.

This isn’t the first new idea Ikea has rolled out in a bid to better address the future; it’s been staging several pilot programs including furniture leases and home assembly services, among other things. It’s also reportedly drawn inspiration from Zalando, an online fashion retailer which sells several brands of clothes on one site.

Torbjorn Loof, Inter Ikea’s chief executive, noted “What are the opportunities between the dominating, big, global platforms, and the company website? I think there are tons of opportunities. I think it’s a very interesting area to explore. I think in the next five, 10 years, we will see what we now call the platform developing,”

The problem with Ikea’s plan is that, in its bid to become the Amazon of furniture, it has overlooked the fact that there already is an Amazon of furniture: Amazon. Amazon already stocks furniture from Ashley to Sauder to Winsome and just about everything in between, and already has the name-recognition that even Ikea could only aspire to. How it intends to be a one-stop shop for furniture when there’s already a one-stop shop for furniture and pretty much everything else is almost woefully unclear. To actually accomplish this grand design would take some significant innovation that Amazon itself doesn’t already have and can’t readily match.

Ikea could do the job, of course…but it would need some serious compelling reason to actually get customers away from the current Amazon of furniture: Amazon.