Ikea To Boost Online Sales

Ikea wants the online share of its sales to grow from almost nothing to 20 percent by 2020, and the retailer is rolling out a new ecommerce platform to push toward that goal, Retail Week reported on Thursday (Nov. 13).

The new web platform, which uses ecommerce software from Oracle and an order management system from IBM, and will go live in the next year, said Lars Gunnarsson, IT demand manager at Ikea.

While Ikea has run some interesting promotional experiments on its site in the past, its actual ecommerce sales are currently negligible. “Today our whole business is based on shoppers coming to the store, picking things up and delivering them yourself,” Gunnarsson said at the JDA FocusConnect conference in Barcelona last week. “Ecommerce is our single biggest project.”

It’s also the biggest challenge for the Swedish furniture giant. Conventional wisdom says that online retail is all about customer-friendly elements like targeted discounts and free shipping and returns — which work fine for shoes and apparel, but aren’t practical for flat-pack furniture sold with very low margins. In order to keep costs down, the chain plans to let shoppers pick up items directly from warehouses.

“The challenge won’t be having an inspirational site or placing an order, it will be about the bottom line,” Gunnarsson said. He added that even if ecommerce hits the 20-percent-by-2020 goal, Ikea will remain a store-based business. “People still want to touch and feel,” he said. “It’s more of a matter of opening up more options.”