executive impact

Passion for life at home for IKEA's man in Japan

By Bruce Davidson for EURObiZ Japan

IKEA celebrates a decade in Japan next year with various special events and promotions. Since opening its first store in Chiba in 2006, the iconic Swedish home–furnishings provider has expanded to eight locations across the country. IKEA Japan’s president and CEO Peter List has worked for the firm for 25 years. He talks to EURObiZ about the opportunities for IKEA in this market.

Please tell us the purpose and goal behind launching IKEA in Japan.

Being a global company, we looked at all the countries and their potential. And with such a high GDP and the third-biggest home furnishings market in the world but IKEA not being present, then, of course, there was an opportunity for IKEA to enter Japan. The home furnishings market here is really segmented. There is not really one brand that owns the market. You know, our vision is “to create a better everyday life for the many people”. So with that in mind, we saw a massive opportunity to enter Japan.

What do you feel makes IKEA unique in this market; and, when compared to other firms, what is your strength?

We are absolutely passionate about life at home, so we visit people’s homes all over the world, from Paris, New York, London and Tokyo, to see how people live. What are their needs and frustrations in the home, and then find solutions for that. And what is unique about IKEA is all those ideas, thoughts and needs are basically how we start to develop our products. And, of course, every product needs to be able to meet something we call Democratic Design, which is about form, function, price, sustainability and quality. Only when a product meets those things can they be developed for IKEA. The other advantage that we have is that we form long-term partnerships with suppliers and, together, design our products — often on the factory floor — always striving to do things in a better way.

Can you tell us more about this Democratic Design concept?

We think that design should be for everybody, not for the few. Often, when you talk about design, people say that comes at a very high price. We say not so. Yes, we want to have the lowest price; we want the customer to be able to afford and have good design. But there is more than just form and design; it needs to be a quality product. It needs to be able to last in somebody’s home for many years. So the quality aspect is very important. Then it comes to price. We need to have a low price, and [the product] needs to be sustainable. When we talk about sustainable, it’s about a sustainable life at home — that we have sustainable forestry with the wood that we use. All those elements are Democratic Design.

IKEA is transforming into a multi-channel retailer. Can you tell us what that means?

Our customers today are changing; and people are much more digital, as well as physical, in the way that they shop. They want to shop when they want and how they want. IKEA needs to change with that. So we are doing that. We are very much looking at how can we then be available; when somebody wants a sofa or a phone, they then start their shopping experience. It doesn’t literally mean going to visit a physical store.

The physical store will always be our competitive advantage. A 40,000-square-metre store, being a fun day out with a food offer and a store to wander around in — with furniture and accessories, and areas for the kids to play — will always attract people. But we want to be more than that. So we will have a new web platform — and e-commerce that we will introduce — to make it so you can shop once you see things on the web as well. And we need to become closer to our customers, so we’re going to try new formats — even smaller IKEA locations — to order [products], have them delivered and picked up closer to the customers.

Does IKEA have plans to expand in Japan? If so, where and when?

Today, we have eight stores in four regions of Japan. We have a distribution centre in the Tokai region as well. We will soon open a new store in Nagakute City; we will have the land handed over to us next March. That’s a store we’re really excited about, because it will be the first store in the Tokai region. Actually, 9% of the customers in our Osaka store come from the Tokai region. So we know that Tokai wants IKEA, and we want to be there, too. We’ve developed a very good relationship with the city and will open a 35,000-square-metre store there in a couple of years.

Can you talk about IKEA Japan’s philosophy on people?

It starts from the concept: without people, we can’t grow our business. So when we grow our people, our business grows. And that’s very much our philosophy about linking it back to creating a better everyday life for the many people, which includes our coworkers as well as our customers. So, really, it’s about developing our coworkers and their competence within the company. If you want to do something, it’s not about your education or qualifications; it’s about your passion and your interest in life at home, and your interest to grow and develop. That is what we believe in for all our coworkers.

How does this commitment involve people who work at IKEA?

Last September, we decided that we would do something called “We Believe in People”. Again, this was to create a better everyday life for the many people, and to tackle some of the many challenges in Japan. We believe in a 50/50 diversity and think gender intelligence is very important to the way we meet our customers. Our customers come from all walks of life and different age groups, so we wanted to meet them in that way. But we also saw the challenges, like part–time co–workers are being paid less than full–time co–workers. And if you think that most of those part–timers are women, then there was a real difference in pay. We wanted to say that we would be fair and equal, so we introduced the same pay range, benefits and expectations for jobs for all co-workers.

We also offer diverse benefits and opportunities that meet the needs of the many with social insurance and pensions. Then we improved job security with permanent contracts. Ultimately, we want a long–term relationship with our co–workers; it doesn’t matter how many hours you work, or [what] your life situation [is], you can grow in IKEA.

© Japan Today

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I wonder if Bruce Davidson has ever been to an IKEA store? If so then he might have asked Peter List why they persist with the ludicrous layout of their stores which annoys many people, including myself, so much that they will never go to IKEA unless it is very much a last resort.

5 ( +6 / -2 )

Harry, agree layout is annoying. also wasn't there a foos poisoning scandal (meatballs I think) at some of their stores in Japan?

3 ( +4 / -1 )

Ikea is perfect for 1 year visa stays. Thats about how long junk furniture lasts.

4 ( +6 / -2 )

Holy cow!

A cup for 524,180 yen...

I thought Ikea was meant to be good value.

0 ( +1 / -1 )

I like IKEA, but try to avoid going there on weekends. My favorite item is the 50yen ice-cream at the end. I usually manage 2 or 3 before my wife moves me along. Yes, the quality was questionable 20 years ago, but these days everything is actually quite well built and there are no more missing pieces.

I have a Billy bookcase, an Expidite shelf, a Malm bed and a Pax wardrobe. I guess it's a real testament to their marketing ability that I can still remember what my furniture is called years later.

3 ( +4 / -1 )

@M3M3but these days everything is actually quite well built

Glad to hear you've had good luck, but that's not been my experience. I paid more than ¥35,000. for an arm chair that lost shape after a month and that was pretty much worthless after 3 months.

Are these articles, like the one with United Air and Santa Fe, paid adverts? If so, shouldn't that be written, or is it just assumed?

-1 ( +2 / -3 )


Sorry to hear about your armchair. Yeah, I would definitely agree that their armchairs, sofas and office chairs are one of their major weak areas. Their prices on armchairs are also not very competitive either, especially on anything leather. I bought one for my in-laws and it wasn't fantastic.

Are these articles, like the one with United Air and Santa Fe, paid adverts?

I doubt it, who would pay real money to advertise to people like us? lol

3 ( +4 / -1 )

I enjoy the first floor much more than the 2nd, also it is a bit of a hazzle to first go upstairs and than downstairs again. Comparing to Nittori they have one big advantage though: You can take your furniture back with you, no matter how big. In summer I bought a bunk bed for the kids at Nittori (Ikea is just too far away), had to take the mattresses (optional) back with me and than wait for 3 weeks till the bed arrived!

1 ( +1 / -0 )

I thought IKEA was here decades ago, failed and left? Is my memory failing too?

I'm not a fan. It's just too annoying to have to put together stuff myself for such an exorbitant. It's for young people who don't know any better...

-2 ( +2 / -4 )

I thought IKEA was here decades ago, failed and left? Is my memory failing too?

They left, then came back maybe 5 or 6 years ago.

1 ( +2 / -1 )

Not to mention the bed we bought!and the matching cabinets...omg..it's falling into pieces...wait till the J find out more about their item... My husband hates IKEA, I wonder what the staff are really doing there as they don't seem to be needing any work to do as you have to do every darn thing yourselves! It also is an extended place if you can't make it to Disneyland with all this kids!!! it's a very stressing place to go and shop!

2 ( +3 / -1 )

is that a grindr profile photo?

0 ( +1 / -1 )

Didn't IKEA teach us all to love practical, modern design?

Crowds: for some it's a destination experience, and you'll get zombie tourists oohing and aahing in any IKEA (or Costco) anywhere on the planet. If we're unfortunate enough to visit on a public holiday, our son goes on my shoulders, and we don't get a trolley until we're right inside the warehouse section, so we can cut through the zombie hordes with ease, and we never shop on a (metaphorical) empty stomach.

Hell is driving to Shin Misato on a Sunday and visiting both IKEA and Costco, with no shopping list.

Quality: it is what it is, and the pricing is great. If you want something to last a lifetime, Herman Miller or the Conran Shop will be happy to oblige.

1 ( +2 / -1 )

I like the company Ikea, they give their workers a livable wage , none of the minimum wage crap paid by most firms here.

1 ( +2 / -1 )

I felt confused there. I entered on the first floor and was told I "was doing it wrong and not following the arrows on the floor!" Really weird experience. I thought the beer section was a good idea! Needed it after that complete overload. Left with a bathmat that is still in tact. The funny part was the little fridge magnet cannisters. There were a number of us fondling them lovingly and simultaneously wondering aloud what in the heck one would really put in those. Too small for pasta. Too big for pain killers. Spices? Paper clips? Really cool, but didn't get one. Haven't been back. No online shopping and it is just too far for the value. Bought a great wooden-iron rocking chair at J-MART this summer.

0 ( +0 / -0 )

@Harry_Gatto the reason it was designed that way is the same reason supermarkets are designed the way they are, to keep people in them. IKEA has an exceptional experience strategy for keeping people in their showrooms and buying markets. They quite honestly created the experience market and showroom centric design situation. So although you might find it annoying, they have done it for a reason.

0 ( +0 / -0 )

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