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A New Era of "Precision-Oriented" Retail
Ikea is moving away from large-scale expansion. Instead, the company is focusing on resources "closer to the consumer." This includes:
- Closing large locations in high-income metropolises.
- Opening smaller, urban stores in shopping malls.
- Strengthening digital channels like WeChat, Tmall, and JD.com.
Why the Traditional Model is Struggling
The article describes a "cultural break." While Ikea furniture was once a symbol of social status for the middle class, the current real estate and consumption crisis in China has changed the market.
Damian Maib, Founder and CEO of GENUINE, explains in the article that the classic Ikea model—large suburban houses, car travel, and DIY assembly—works significantly worse in China than in Europe or the USA. According to Maib, Chinese consumers prefer ordering via apps and expect fast, cheap delivery and assembly services.
Transformation into "Brand Experience"
The shift to smaller city formats is designed to connect offline branding with online conversion. Damian Maib describes Ikea’s decision to reduce large stores in favor of compact, urban formats as "absolutely right."
From a strategic perspective, Maib notes that stores no longer need to serve primarily as sales and warehouse spaces. Instead, they are becoming places for brand experience, where products can be felt and seen while the actual transaction happens efficiently online.
A Signal for the Global Market
The article concludes that if even a giant like Ikea is dismantling its "shopping palaces," it is a clear sign that China’s consumption miracle has entered a new, more sober phase. For customers, this means less heavy lifting and more convenience.
Read the full article here: Handelsblatt
