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Are Digital Retail Festivals the ‘Next Big Thing’? IKEA Thinks So
IKEA is unveiling its first-ever digital festival. Available for only 24 hours across over 50 countries, the retailer’s festival celebrates the idea of home.
The festival, which is free for users to explore, features live DJ sessions, cooking lessons, interior makeovers and concerts. The digital festival encourages users to explore different ‘rooms’ from over 100 homes.
Is this the future of digital retail?
According to IKEA, digital festivals are the new experience that could further encourage shoppers to connect with retailers. “This is a new kind of experience IKEA wants to offer, celebrating, connecting, and engaging around life at home,” said MD of IKEA Marketing and Communication AB, Erika Intiso.
“Home tours around the world will open doors to new experiences and new inspiration. We want to spark a conversation on the more sustainable and affordable life at home of tomorrow. And just as with any festival, you can expect a few surprises.”
“Life at home has taken on a whole new meaning for every one of us over the past year, and by being virtually connected, we can open the door to many more lives around the world – exploring how we all live, celebrating individuality and creativity,” said Communications Director of INGKA Group, Olivia Ross Wilson. “Our first Ikea Festival will bring people together around life at home in a new way, both online and in our stores, and will be the beginning of a longer-term movement of real homes and real lives.”
Non-Stop Online Growth
This is not the first digital-focused event that IKEA has introduced. Last year, the retailer cited e-commerce growth as its reason for ending its catalogue after 70 years of printing.
In 2020, IKEA’s online retail sales grew by 45 percent, with its e-commerce platform hitting over four billion visits. As of October 2020, online sales represented 15 percent of total retail sales, and even after stores began reopening worldwide, e-commerce sales remain secure.
INGKA Group, the holding company that operates 367 of IKEA’s 422 stores also recorded a jump in online sales. The Group, despite shrinking its physical portfolio by four percent, recorded 60 percent growth in its online sales, making up 18 percent of its annual turnover.
In 2018, the Swedish retailer enlisted ex-Samsung, Google and Texas Instruments executive, Barbara Martin Coppola, as the Chief Digital Officer. In an interview with Harvard Business Review, she explained that e-commerce levels have tripled in three years. “E-commerce is open 24 hours a day, while traditional stores are not, which means we’ve needed to learn how to operate at two speeds, while operating from one space,” she said.
The digital transformation, as a result of the pandemic, was rapid. “With the pandemic and with the closure of approximately 75 percent of our stores, we ramped-up and accelerated even more as people turned online and towards digital solutions,” she said to HBR. “Things that would normally take years or months were carried out within days and weeks.”
The retailer understands it needs to remain relevant in the ever-evolving digital landscape. While the DNA of the retailer remains the same, IKEA is introducing an implementing data and insights into its strategy to determine what is best for its customer, and how the behaviour is changing in a pandemic landscape. “We are reinventing IKEA for the future, no less than that,” Martin Coppola said.
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