Ikea Cooks Up Best Buy Partnership to Expand Retail Reach

The next time you buy kitchenware from Ikea, you might be doing so at Best Buy.

The Swedish furniture seller is looking into using space inside other retailers’ locations to expand its customer base in “mature” markets in the United States and Europe, the Financial Times reported Tuesday (Sept. 9).

Ikea hopes to open kitchen planning studios, or smaller spaces that offer customers advice on kitchen design, in 10 Best Buy locations in Florida and Texas later this year, the report said.

Tolga Öncü, retail manager at Ingka, which operates almost all Ikea stores worldwide, said this is part of an experiment to expand the retailer’s presence in a way that’s faster than simply opening new stores, per the report.

He added that the Best Buy partnership would bring Ikea “closer to more of the many people” in the U.S. and could be “yet another component for us to accelerate our reach, especially in big mature countries,” according to the report.

Ikea has revamped its business model in recent years, shifting from requiring customers to trek to out-of-town warehouses to pick and assemble the furniture themselves, the report said. It has begun opening shops in city centers, while providing online ordering as well as home delivery and assembly services.

Executives say that customers appreciate the extra convenience of being able to shop on their lunch hour, but some have been frustrated by a lack of availability of products, according to the report.

Best Buy did its “homework in locations where Ikea is not [present],” Öncü said, per the report. “If we were to start and look for a smaller format of Ikea in the same location, it can take years before the square meters become free.”

Ikea is one of relatively few retailers that is still expanding, using its large stores as fulfillment centers for eCommerce orders, the report said.

Emily Amor, a Shopify marketing expert at Digital Darts, told PYMNTS in February that eCommerce brands get immediate credibility when they venture into physical retail.

“It tells customers you’ve grown beyond the screen, proving your popularity and success in a way that online presence alone can’t,” she said. “In-store shopping also gives you access to new customer segments who prefer in-person shopping and can also result in higher conversion rates.”

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