Trends like technological development, rapid urbanization and a heightened awareness on the impacts of climate change have long been shaping the purchasing habits of consumers globally. This year – when the coronavirus pandemic caused an unprecedented level of disruption – the success of the world of retail often depended on the ability to accelerate transformation efforts.
With the recognition that changing conditions require a proactive, innovative and long-term approach, IKEA Canada embarked on a journey to adapt business practices and customer engagement three years ago.
These steps enhanced the organization’s capacity for meeting emerging challenges, believes Eri Mathy, business development manager, IKEA Canada. “Three years ago, we started our transformation to ensure we can meet the needs of customers today and in the future. We wanted to be more agile and able to respond to changing needs and circumstances.”
Business development manager, IKEA Canada
In addition, consumers are increasingly choosing to do business with organizations they trust – organizations that take a longer view and are guided by a clear vision and strong core values. “Companies are called upon to take action and influence positive change,” says Michael Ward, CEO and chief sustainability officer, IKEA Canada. “At IKEA Canada, there are three key areas underpinning our transformation journey: accessibility, affordability and sustainability.”
The value of focusing on these priority areas has come even more to the forefront in 2020, when COVID-19 changed the way Canadians live, work, interact and shop. At the peak of the pandemic, all IKEA Canada stores were closed for nearly three months and sales shifted online. A successful transformation is evident in the organization’s sales report for the financial year ending August 31: While total sales decreased by 8.7 per cent compared to the previous year, online sales saw a significant lift of 41.9 per cent, with visits to IKEA.ca and the IKEA app increasing by 52 per cent.
“It’s been a privilege to be part of our customers’ homes during a year when they need it most,” says Ward. “Taking what we’ve learned, we’re creating an IKEA that is faster, more agile and ready to meet the new needs of our customers.”
Accessing solutions where and when they’re needed
To adapt to unprecedented levels of e-commerce demand in the past year, IKEA Canada accelerated efforts to optimize central and store fulfilment networks and enhance digital solutions and services. Stores were transformed to also become fulfilment hubs, leveraging and increasing in-store warehouse footprints and logistics capabilities to ship local orders, reducing lead times and lowering delivery carbon footprint.
Efforts to improve accessibility include making existing channels work seamlessly together as well as offering new options for customers to shop, says Ward. “While online growth has been massive this year, our physical locations continue to play an important role in engaging our customers. We’re also exploring new formats and partnerships.”
A key component of increasing accessibility is providing customers with products and services closer to home, says Bruno Dumas, head of Commercial Operations at IKEA Canada. “A lot of people live, work and shop in cities. And since many of these customers don’t rely on cars, providing local solutions is really important.”
Head of Commercial Operations at IKEA Canada
In Toronto and Montreal, for example, IKEA Canada is “expanding flexible and affordable services where customers can pick up their purchases a few minutes from home,” Dumas says. “We currently have eight pickup locations in the Toronto area, with plans to grow our network. And for our time-strapped customers, we recently launched collection lockers at Toronto stores where shoppers can pick up goods at their own convenience, 24/7.”
Beyond addressing barriers like distance and timing, “[IKEA Canada is] looking to support customers in their desire to make purchases when and where they wish; for example, through the new IKEA shoppable app,” says Mathy. “We also want to meet their needs in a more personalized way.”
Enhancing affordability ‘for the many’
COVID-19 has redefined the role of the home for many Canadians, states Dumas. “Home is no longer just the place we return to after work – it’s the place where we work, exercise, cook and educate our children,” he says. “We believe we can leverage our expertise and knowledge around life at home to support our customers to adapt to changing circumstances.”
Yet at a time when home solutions are urgently needed, a significant number of people face increased economic hardship, says Mathy. “We know that not only are people’s wallets tighter, but many face uncertain times ahead,” she explains. “And since people are going to be cautious about spending, we really need to be bold in our ambition to become more affordable, not just in our products but also our services.”
In addition to innovating and investing in affordable services, Ward says IKEA Canada is expanding options, such as Curbside Click & Collect, virtual planning, design tools and at-home assembly with TaskRabbit, which can help Canadians with shopping, implementation and planning.
Uncertain times often inspire a focus on essentials, adds Mathy. “We want to support Canadians in creating a healthier and more sustainable life at home when they need it most. We want to offer sustainable living at an affordable price that is easily accessible, not just for a few, but for the many.”
Improving environmental performance with sustainable options
Sustainability has always been a core part of IKEA Canada’s approach, and customers and employees alike welcome the organization’s attention to improving environmental performance, explains Ward. “People are demanding transparency as well as responsible business practices. And one thing we’re really proud of is how we can inspire and enable customers to live more sustainably.”
IKEA Canada will put increased focus on sustainability in the coming year and recently launched a campaign titled “One Little Thing,” says Mathy. “It’s based on our belief in the power of small actions to create big impact, which can ultimately help fight climate change. For example, we know that 90 per cent of people want to live more sustainably but often don’t know how to get started.”
CEO and chief sustainability officer, IKEA Canada
In exploring IKEA Canada’s offerings – both online and in stores – customers are alerted to sustainable options via green dots, which highlight solutions and advice for saving energy, water and waste at home, she says. In addition, the organization aims for 100 per cent of home deliveries across Canada to be made by electric vehicles or other zero-emission transportation by 2025.
Response to sustainability initiatives has been overwhelmingly positive, says Ward. “We are already exceeding our annual goals for growth in this area, and globally we are working toward our ambitious goal of becoming fully circular and climate positive in total operations by 2030.”
Working together for a brighter future
Partnering with customers, co-workers and like-minded organizations to improve outcomes for everyone is “really a win-win. We are trying to create a movement together,” says Mathy.
“We will transform our business to be even more accessible to our customers, no matter how they choose to shop with us. We will become more affordable across our total offerings, including services, and we will take a leap when it comes to enabling even more Canadians to live a more sustainable life at home,” says Ward. “At IKEA, we are driven by a simple yet powerful vision to create a better everyday life at home for the many, and this has never been more meaningful than it is today.”
Produced by Randall Anthony Communications. The Globe’s editorial department was not involved in its creation.