Ikea to Invest More Than $3B in Stores By 2024
Ingka Group, Ikea’s largest franchisee, on Monday announced it would invest more than 3 billion euros, or about $3.2 billion at press time, in its stores by the end of next year. The retailer aims to become more accessible for customers whenever and wherever they want to interact, according to a company press release. Ikea will focus its expansion investments in new physical stores as well as revamping existing ones for a more immersive shopping experience and to further support the increasing demand for home deliveries. The investment will bolster Ikea's physical presence across the globe. Over the past three fiscal years (FY19-21), Ingka Group invested more than EUR 2.1 billion in existing and new stores across its 32 markets.
Total Retail's Take: Ikea's investment in its global brick-and-mortar locations aligns with the changes in customer behavior that the retail industry has seen since the pandemic began. As e-commerce booms, many consumers now expect the convenient option to pick up their online orders at nearby stores, rather than waiting for product to be shipped to their homes.
"We see many of our stores playing a dual role, giving our customers the best of both physical and online retailing and the investment will support not only an inspiring in-store Ikea experience but also a faster and more affordable shipping of online orders directly from our stores,” says Tolga Öncü, retail operations manager at Ingka Group.
Ikea said its physical stores will continue to remain an essential part of its business model. By doubling its brick-and-mortar locations as e-commerce distribution points, Ikea is better positioned to meet consumers' expectations for a seamless omnichannel shopping experience.
Kristina Stidham is the digital content director at Women in Retail Leadership Circle and sister brand Total Retail. She is passionate about digital media and handles video, podcast and virtual event production for both brands. You can often find her at WIRLC, TR, or industry events with her camera and podcasting equipment recording interviews with retailers.
Kristina holds a B.A. in Media Studies and Production from the Temple University Klein College of Media and Communication in Philadelphia. Go Owls! When she's not in the office, she loves to go on long walks, sing around the house, hangout with her two pet guinea pigs, and travel to new places.