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Inside Ikea’s e-commerce launch

Better late than never is the strategy underpinning Ikea’s Australian e-commerce rollout. The Swedish flat pack pioneer has recently begun the process of turning their online presence, which was previously just a digital product catalogue, into a fully fledged shopping channel.

The expansion is set to occur in stages, with click-and-collect services having already launched to Tasmanian customers at the start of this month. This will be compounded by a more comprehensive online shopping and home delivery service that will launch in the ACT from 30 November.

It’s far from flicking the switch on a nationwide online store, the likes of which most major Australian retailers already have, but according to Ikea’s head of multichannel Michael Donath, Ikea doesn’t want an e-commerce offer for the sake of having an online shop.

“We started in Australia with this multi-channel approach where focusing on the customer journey is really important. We weren’t going to release on any solutions that didn’t focus on what the customer’s needs were,” Donath said.

“[We want] to ensure that whether you’re shopping online or in-store, the solution is very seamless and unique. It’s about a great shopping experience,” he said.

Ikea is well-known for its unique in-store experience, characterised by large format depots filled with stock and provided ‘pathways’ for shoppers. While Ikea’s website isn’t that different to any other online shopping platform, Donath has set the goal of getting 10 per cent of total sales from e-commerce.

This is part of a wider growth strategy that’s seen the company double its Australian store footprint from four to eight over the last few years.

The global retailer has learnt from expanding into the online space in the UK eight years ago, and is now positioning itself to offer an agile platform that can respond to changing consumers, including mobile.

Despite only functioning as a catalogue, Donath says the company’s website pulls in 40 million visits per year – 50 per cent of which come from mobile.

To support the ongoing expansion of their Australian offer, Ikea is investing heavily in distribution centres across the country. An upcoming distribution centre in Western Sydney is set to support country-wide distribution for online and in store customers – playing to Ikea’s move towards an omnichannel retail model.

“It’s about ensuring that our brand is more accessible across the entire country. Therefore it’s not just about e-commerce; it’s about lots of different touch points. It’s about building new stores as well, building the appropriate distribution centres to support those stores and e-commerce and touch points,” Donath said.

Only four per cent of Australians have bought furniture online, and Ikea’s move into the e-commerce brings them into direct competition with pure play retailers such as Temple & Webster and Zanui. However, Donath argues that Ikea’s established brand presence and comprehensive offering are poised to win hearts and minds.

“There’s something to be said about our range. [We have] 9,500 products online and in-store available to purchase, and we look at that democratic design where it’s about the quality or the function or the low price,” Donath explained.

“There’s a lot to be said about our range and how we lead that with our offer. As much as that digital experience is important in working across channels, it’s also about how our range is and who we are – it supports our customers in their everyday life.

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