Replacing Swedish Meatballs with Chicken Curry – IKEA Bets on India
IKEA will open three new stores in India next year. The Swedish furniture company declared that they are “here to stay” and plan to have twenty-five Indian stores by 2025. Where is all this confidence coming from? IKEA’s marketing team researched the local market extensively. Let’s check how the multinational company plans to convince Indian customers.
The Time Is India
Recent years have proved what market researcher predicted. India’s consumer purchase power has made the country the new top retail destination. In 2016 India bypassed German ecommerce and took 4th place among the largest global ecommerce markets. But many Western companies have tried to conquer Asia’s new market and failed. As international SEO experts we know that the key for a successful business expansion is understanding local culture.
We’ve previously written of Dove’s successful penetration to the Indian beauty market. Their marketing strategy was to establish a close relationship with current Indian social trends and issues. IKEA is a globally recognized brand not only because of its stylish and low-cost furniture, but because of its smart and innovative marketing. With only a couple of months before opening their first Indian store, let’s check how the campaign is going so far.
Working with The Community Instead of Robbing It
IKEA has been present in India for years. The brand’s top quality rugs actually come from India. We all know that Western retail heavily depends on Eastern manufacturing and supply. But IKEA pushed a plan to improve working conditions in local rug manufacturing hubs. The brand broke the traditional image of an exploiting multinational company and replaced it with the role of a socially concerned employer.
Another positive contribution to the local economy is IKEA’s collaboration with India’s social entrepreneurs. The IKEA MÅNGSIDIG collection features limited edition embroider pillows and weaved baskets. These products are handmade by skilled local craftswomen. Social entrepreneurs gave these women the opportunity to train and eventually giving them a stable profession earning wages to support their families.
Revolutionizing The Social Hierarchy with a Paycheck
Western companies have not only brought new products to India, but are revolutionizing society within. Much like Dove’s advertising campaign, IKEA also advocates female empowerment. The traditional gender structure in India is shook as more and more women decide to educate themselves and build a career instead of staying home.
IKEA’s Indian website does not feature any product pages yet. But what stands out is the jobs section. IKEA advocates a 50/50 gender ratio in the workplace. Job vacancies are also heavily promoted on the company’s Indian Facebook profile. So far the company has received a lot of positive feedback for doing so. Not only are new job vacancies opening up, but women are directly encouraged to apply. Many women might have an inbuilt social fear or prejudice that IKEA wants mostly male employees. That is why these ads carry a greater social message aiding the fight for gender equality in the country.
A Change of Menu
IKEA has established a long and appreciated presence in India before the start of building stores there. By working with community manufacturers and social entrepreneurs people already have built a positive image about the brand in their heads. Getting to know local business and building up a good reputation helped when buying up land and sorting out necessary paperwork with local governments.
But there is one thing the Swedish furniture company will sacrifice – their restaurant menus. The one thing Indian people are not willing to adjust to is accepting new food habits. Famous for its exotic tastes and spices, Indian cuisine has a special place among world culinary. When Indians travel their biggest concern is what they will eat abroad. That is why they will search for Indian or at least other Asian restaurants instead of going local.
For a Change, Why Not Learn From People’s Mistakes?
One of the biggest and still most intriguing entries of a Western company in to India is definitely by McDonald’s. Why? Because for Hindu people in India the cow is famously recognized as a sacred animal and 38% of the population is vegetarian. So how does a beef burger franchise survive in these conditions?
McDonald’s had to learn the hard way as the company strategist failed to do sufficient research. Several protests were triggered by the politically active Hindu population against the usage of beef meet and beef fat for frying. Today the McDonald’s menu in India is almost unrecognizable in comparison to the Western one. It offers much more vegetarian based meals. But due to sloppy customer service @mcdonaldsindia receives much heat from angry local customers via Twitter.
.@mcdonaldsindia Horror for fasting Hindus. Chicken burger served instead of veg. Staff very casual. Disgusting!
Will never visit MacD
— Sunil (@drsunilsharma) August 12, 2017
— Love Paliwal (@paliwal_love) October 17, 2017
Can’t Run with a Partner You Can’t Trust
Latest news on McDonald’s in India concerns the closing of 43 outlets in Dehli. The cause is an ongoing legal dispute between McDonald’s and the local joint venture partner Connaught Plaza Restaurants (CPRL). Due to McDonald’s opposition of how top management was running the restaurants, the US company refused to prolong necessary license agreements.
The situation is not ideal. But this is a good opportunity for McDonald’s to find a new business partner, which could boost the level of quality and hygiene in its Indian outlets.
Let’s Spice Up Those Meatballs
A big part of the experience in shopping in IKEA is also eating at the restaurant. People in Western countries appreciate the diversity of IKEA’s menu. The strategy is always to offer Swedish and local cuisine cooked from local and organic ingredients. IKEA’s restaurant menus and food shops have become an inextricable part of the brand’s image.
The new IKEA store in Hyderabad will have a one thousand seat restaurant serving both Indian and Swedish cuisine. John Achillea, IKEA veteran and the store’s manager said:
Hyderabad is a foodie city and we will absolutely have biryanis — both vegetarian and non-vegetarian. We respect the faiths in India and our meatballs have pork and beef, so we won’t bring that to India.
The management also hired an Indian chef to find the right culinary mix. As a result, half of the menu will include vegetarian dishes such as sambar, samosa and vegetable biryani.
The overall outcome is Swedish in style, but with an Indian taste. Such self-sacrificing strategy proves why IKEA is a leading multinational brand and master of multicultural global marketing. In comparison to other foreign brands the Swedish retailer puts local cultural habits first instead of forcing misunderstood outside customs.
Are you a food based company wishing to expand East? There’s a good chance you won’t have much competition. Let’s review the markets first and then talk strategy. Get in touch with us.
Featured image source: Ikea.in