People in Mumbai will soon be able to buy Ikea’s home furnishing products online as the Swedish retailer is taking a multi-channel approach to expand its India operations after its Hyderabad store completed its first year.
Ikea’s officials and the company’s 800-strong Hyderabad team celebrated the first year of its first India store on Friday.
Going online before opening the large-format store proposed in Mumbai comes as a slight change in the company’s plan. It had earlier announced that the e-commerce platform would be launched with the opening of a store in Mumbai this year. The company, however, is yet to announce a date for opening of Mumbai store as a large-format store similar to the Hyderabad one is still under construction.
Ikea India Chief Executive Officer (CEO) Peter Betzel said the e-commerce channel in Mumbai would be followed by cities such as Hyderabad and Bengaluru. “In the first phase, we have committed to invest Rs 10,500 crore in India. Of this, one-third has already been invested and more investments will be made depending on how the country and business will grow,” said Betzel.
The CEO said the customer accessibility was the prime focus of the company’s multi-channel approach. Small-format stores and online platform would also be playing a significant role in business development alongside the large stores proposed earlier, he said.
The Hyderabad store, spanning 400,000 square feet area, was opened last year as part of the company’s plan to develop a chain of big-size home furnishing stores in major cities starting with Hyderabad, Mumbai, Bengaluru, and Delhi-NCR. The work is in progress on the proposed stores in all the three cities, said Betzel.
He termed the Hyderabad store a success, claiming it met many of the company’s expectations. It has also presented a unique opportunity to learn the preferences and needs of Indian customers. “We have not come here to say this is how it should be, but understanding what people want, and build products accordingly. Today if someone is thinking of buying a home-furnishing product, Ikea is on top of their mind,” he said.
More than 4 million people visited the Hyderabad store in the past year. The most–preferred categories are beds and mattresses, bathroom, decoration, and dining.
When it comes to Delhi-NCR, IKEA has decided to open its retail centre together with the home-furnishing store in Gurugram, Betzel said.
The company is also exploring B2B business in India and it has already tried on some projects as the large-scale construction of residential and office space in the city and elsewhere provides an opportunity to work with the developers to provide home and office furnishing solutions to the end-users at the project level. The firm said it would bring its rental furniture business called Circular Ikea — currently being tested in Europe — to India.
The Circular IKEA makes a big sense as the furniture can be refurbished and repaired to extend its use value, said a senior company executive.