NEW DELHI :
On 18 December, Ikea will open its second large format store in India at Navi Mumbai, a significant market for the Swedish retailer. Kavitha Rao, country commercial manager, Ikea, India, who oversees sales, marketing and customer experience for the company said that Ikea will meet more shoppers in India through both large and small format stores as well as online, in line with its global plans to be a multi-channel retailer. Also, Indian consumers will be able to buy more locally sourced products at its stores. Edited excerpts from an interview:
How has consumer demand changed post-covid?
The immense amount of time all of us have been spending at home, is really reflecting in how we have begun to see the needs at home. That’s had an impact in terms of the interest in home furnishing and what consumers have done in the last nine months. People have discovered a lot of needs related to their home. A classic example has been work-from-home. In most Indian homes having a study room or a study table was a nice-to-have feature, now it may be an essential need. A lot of allied areas are seeing a lot of interest. We can clearly see that there is a big uptick in terms of cooking and eating-related range, apart from an uptick in the organising and storing related range. Interestingly, people are buying a lot of outdoor (products) and doing up the balconies and so on.
How will your Mumbai store be different from the one in Hyderabad?
The solutions that you will see in the store in Mumbai will be very much reflective of life at home in Mumbai, which is very different from what it is in Hyderabad. For example, the size of a home in Hyderabad is far larger than what it is in Mumbai. On an average, I think 60% of the people in Mumbai live in a space that is less than 500 square feet. So the solutions, the room sets, the inspirations etc will actually reflect this. The second aspect is also related to how people in Mumbai, are very focused on multi-functional furniture. Maybe in a Mumbai home, let’s say the living room is also used as a dining space, it could also be used as a work-from-home space. So, you will see some of those solutions also brought to life. It’s also got one of the largest warehouses as well in order to meet the demands of our consumers. In Hyderabad, we went in the physical format. In Mumbai we started off with e-commerce as an option. With the opening of the physical format, we’re really becoming an omni channel retailer in Mumbai.
Will the store see more locally sourced products?
Local sourcing is a very big initiative for us. Textiles were always an area where India has had a big strength for many years. But in the last five years, we built a lot of capability in two other categories — the space of comfort, which is very important because that is really what goes into our sofas (Ektorp range for example) and mattresses etc. The second category where we made significant progress is around metal, plastics and so on. Two areas where we are trying to make a difference, but it is taking us much longer, is solid wood-based furniture as well as board-based material. Capability creation in India is going to take us a lot longer.
Post-covid have you seen a shift in traffic from your store to online?
Of course, people have channel shifted because the early stages of the pandemic there was a very strict lockdown, our own store in Hyderabad was closed for a period of time. We saw that the e-commerce demand was three to four times of what it was before. At our end, we also launched click-and-collect. What is very interesting to see is that online for some people is becoming a habit. Online shopping continues to be on a trajectory of growth. I would not say that we are unhappy with it, I would say that we are happy with it. In a market like India which is very mobile, we expected this behaviour from consumers.
Globally Ikea is opening up across multiple channels—where does that stand in India?
In India, it’s very important for us to acknowledge the heterogeneity in the market and the heterogeneity in the consumer segments as well. For us Mumbai is a mega city—so e-commerce, or the Navi Mumbai store is just the starting point for us. The size of the city, its scale and the number of people living in that city—one Navi Mumbai store and e-commerce is never going to be sufficient. We know we have to have a multi-pronged approach. In calendar year 2021 we’re hoping that we will be able to open two smaller format stores which will also take us much closer to our customers.
When is Ikea opening up stores in north India?
We already have land purchased in Gurgaon for which we have some big plans. There is a discussion in Uttar Pradesh (in Noida) as well. So similar to Mumbai, we will have multiple ways to meet our customers in the Delhi—NCR region as well. We will have the standard stores, smaller stores, we will have e-commerce, and that’s also a location where we’re looking at shopping centres as one of the other options.