IKEA
Significant increase in sales by replacing TV ads with a targeted, data-driven online strategy during a promotion. New loyalty approach smoothed sales peaks, cut campaign costs, and earned a Golden Arrow award for its effectiveness.
Shifting Towards Targeted Promotions: How IKEA Balanced Sales Peaks and Achieved 50% Growth
NOTE:
This case study has already been described and awarded on Golden Arrow 2020 in personalization category
https://pic.media.com.pl/pic/SKLEP/Do_pobrania/2020/Sklep/MMP_07-08_488_2020-Golden_Arrow.pdf
IKEA is a Swedish home furnishings company, one of the most popular in its category worldwide. There are more than 350 IKEA stores in 29 countries around the world, including 11 in Poland.
In 2024, the Furniture market in Europe generated a substantial revenue of US$231.70bn. It is projected to experience a steady annual growth rate of 2.26% (CAGR 2024-2029). Among the various segments within the market, the largest one is the Living Room Furniture segment, which accounted for a market volume of US$60.87bn in 2024.
Resources:
Furniture - Europe
The previous promotional model, based on TV advertising, led to a significant increase in store traffic, particularly towards the end of the promotion. As a result, some customers, despite their interest, were unable to make a purchase due to overcrowding. It became evident that the stores, under the current communication system, could not handle the increased demand.
The main challenge was to increase sales of the assortment without using TV advertising. We decided to leverage our understanding of club members' online behavior to develop a mechanism for selective pre-purchase offers.
Deep Dive Into Customer Analytics
Using the systems, infrastructure, and integration of vast amounts of data from the IKEA Family loyalty program, we have gained deep insights into our customers' preferences and aspirations. We can identify nearly 50% of club members on our website from a base of 4 million. By analyzing their behavior and purchase patterns, we developed a mechanism for scoring individual interactions, enabling us to identify, in real time, customers interested in specific product groups.
Building New Targeting Engine and Personalized Strategy for IKEA Online Visitors
We employed a targeting engine – a special tracking code that collects information from visited websites, identifying cookies and combining them with the data we already have about our customers. This allows us to discern what a loyalty program participant is interested in at any given moment. Recognizing this interest, we can offer a personalized promotion in real time, facilitating the completion of the purchase process.
Continious Testing and Optimization
From day one, we analyzed and scaled various mechanics. We tested different creative variants, gradually expanded, and optimized the eligibility criteria for the offer. We also implemented a telephone survey with participants to fine-tune the mechanics. Over time, these mechanics were expanded to include other product groups.
Real-time Personalized Communication
Another functionality of the targeting engine allows us to personalize the website experience. We can communicate with identified customers in real time. When a customer’s journey on the website and their interactions indicate interest in a particular product range, we display a special offer to close the purchase process. In this way, we are responsible for personalizing and distributing the offer directly on the website.
“Loyalty Point has a solid knowledge to successfully overcome challenges ahead and has a decent technical infrastructure to fulfill high satisfaction of our Customers. On top of this are values like trust, engagement and kindness that make achieving ambitious goals achievable.”
Digital Director Lagardère Travel Retail
I highly recommend Loyalty Point as a strategic business partner. Whether analyzing industry dynamics or addressing complex challenges, their team consistently delivers practical and well-founded solutions.
Senior Marketing Manager
Vision Express
Loyalty Point has a solid knowledge to successfully overcome challenges ahead and has a decent technical infrastructure to fulfill high satisfaction of our Customers. On top of this are values like trust, engagement and kindness that make achieving ambitious goals achievable.
Digital Director
Lagardère Travel Retail
We are very pleased with the results of our cooperation. We especially appreciate the multitasking nature of the team - despite implementing several projects at the same time, complex promotional mechanisms were always ready on time.
Head of Loyalty & CRM
Decathlon
Loyalty Point consistently supports us in navigating various challenges, offering constant, professional and reliable support and tailored solutions that align perfectly with our business needs and capabilities.
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E-commerce, Marketing and Omnichannel Director
Rainbow
The proposed strategy enabled greater identification of customers and a better understanding of their purchase journey. This approach allowed us to target those most likely to be interested in the promoted offer, successfully close sales, and significantly reduce the advertising budget. The cost of running the promotional campaign was reduced by narrowing the target group and conducting highly targeted communication, while sales of the promoted assortment increased by 50%.
We were responsible for key elements of personalized communication on the IKEA website for polish market and also for technical landing page with offer support and email communication.
“Loyalty Point has a solid knowledge to successfully overcome challenges ahead and has a decent technical infrastructure to fulfill high satisfaction of our Customers. On top of this are values like trust, engagement and kindness that make achieving ambitious goals achievable.”
Digital Director Lagardère Travel Retail
I highly recommend Loyalty Point as a strategic business partner. Whether analyzing industry dynamics or addressing complex challenges, their team consistently delivers practical and well-founded solutions.
Senior Marketing Manager
Vision Express
Loyalty Point has a solid knowledge to successfully overcome challenges ahead and has a decent technical infrastructure to fulfill high satisfaction of our Customers. On top of this are values like trust, engagement and kindness that make achieving ambitious goals achievable.
Digital Director
Lagardère Travel Retail
We are very pleased with the results of our cooperation. We especially appreciate the multitasking nature of the team - despite implementing several projects at the same time, complex promotional mechanisms were always ready on time.
Head of Loyalty & CRM
Decathlon
Loyalty Point consistently supports us in navigating various challenges, offering constant, professional and reliable support and tailored solutions that align perfectly with our business needs and capabilities.
E-commerce, Marketing and Omnichannel Director
Rainbow
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