IKEA Is Testing Two New Store Strategies

Swedish retail giant IKEA is testing its first new concept in their Shanghai Xuhui store, moving away from its traditional big-box stores, towards a more intuitive and interactive shopping journey built around “meaningful customer experiences”, events and sustainability.

IKEA’s traditional one-way showroom system was designed to make customers consider nearly every item that it carries throughout their journey, even if they only came in to purchase that one Billy bookcase. The new concept allows visitors more choice in how they want to spend their time in the store.

Entitled the Home Experience of Tomorrow, the new strategy focuses on “emotional and empowering customer experiences”. The most striking break from the past is the disappearance of the set walking route typical of IKEA stores. Instead, there will be a mix of lively spaces for events and co-creation, and quiet areas for visitors to unwind.

The new format pilot in Xuhui features three new permanent community hubs, including a Maker’s Hub, a Design Hub, and a Food Hub. Each one adheres to IKEA’s mission to create a better family life within the globe, while encouraging people and communities to work on and share everything from cooking and yoga classes to furniture workshops.

IKEA is also testing another concept store in Austria. This new urban compact format will be located in the heart of Vienna adjacent to the city center Westbahnhof train station. Designed by Querkraft Architekten, this new building will have zero parking spaces! The entire store concept is designed for urbanites, pedestrians, subway and streetcar riders, and cyclists. The store will encompass seven stories, green facades, a green roof terrace and a rooftop cafe.

The interior and exterior of this new concept store is friendly, open, unconventional and informal. The building’s structure is reminiscent of a bookcase, which, besides the shopping areas and similar to their Shanghai store, packs in a lot of experiential spaces. As well, the building is also surrounded by elevated green gardens housing over 160 trees influencing the micro-climate within the store creating an urban park, further emphasize how sustainability is a major focus of IKEA’s strategy moving forward.

Figure3 Insight:

The pandemic has forced brands to revisit their store design strategies and adapt to new customer expectations and behaviors. IKEA was also very slow to embrace e-commerce before the pandemic, and its online shopping platform had caused major customer dissatisfaction during lockdowns last year. “It appears that the new store formats aim to do more than entertain by combining a more sophisticated e-commerce platform,” says Mardi Najafi, Figure3’s Director of Retail Design. “I was also impressed to hear that in both concepts, customers can use their own phones to scan items for purchase as they walk around.”

In both concepts IKEA’s leadership team is testing ways to keep visitors coming back to their physical spaces, and not necessarily just for purchases. “I’ve said this before and I will repeat again that experiential retail is far from irrelevant,” says Najafi.

The IKEA at Westbahnhof focuses on the dramatic changes we are observing in urban lifestyle. The stores are designed to serve mainly pedestrians, cyclists, and people who come by tram or subway, and even promise to deliver larger items to the customers’ homes within a maximum of 24 hours.

Most importantly their primary function is not selling products. It’s more like a multi-level city and central park, with restaurants and cafés on multiple levels, and it even has dedicated two floors to a hostel.

The retail landscape constantly evolves, and consumer shopping behaviors continuously shift. Successful brands and retailers are constantly having to reinvent themselves and come up with new ideas and innovations to attract more customers into stores. This is where retail designers can help introduce innovative concepts and prototype pioneering experiences.

Images: courtesy of IKEA Group and Jo & Joe