IKEA China's Sales Growth Is Hindered, And The Nordic Furniture Market Is Shuffling Soon

- Jan 04, 2019-

1 Behind the benefits

As a long-term occupation of the mainstream style of the market, the Nordic style is the "safety card" of many home furnishing companies. If it is cold, I am afraid that many people will not agree.

When it comes to the Nordic style, everyone may think of IKEA for the first time. What is the performance of this Nordic-born furniture store in 2018? IKEA gave a piece of data. In FY 2018, IKEA China expects sales to exceed RMB 14.6 billion, an increase of 9.3% over the previous year. This figure seems to be very beautiful. Actually, it can only be considered to be unsatisfactory: in FY2017, IKEA China's sales were about 13.2 billion yuan, and sales increased by 14% year-on-year. In FY2016, IKEA China's sales were 11.7 billion yuan, up 19.4% year-on-year; in fiscal 2015, sales were 10.5 billion yuan, and sales increased by more than 18%. The 2018 sales growth rate fell below 10% for the first time. This is undoubtedly a dangerous signal and seems to be the best evidence of the Nordic winds.


However, another piece of data does not say this: In December, Sina Home and 14 industry associations released a "2018 China New Middle-class Household Consumption Index Report" for the new middle-class population. The data shows that in the decoration style preference, 69% prefer simple style; 33% prefer Chinese style; 28% prefer Nordic style; 13% prefer American style.

From the Baidu search index, the heat of the Nordic style is still high: we choose the "Nordic style", "new Chinese style", "new Chinese style" to compare and find "new Chinese style", "Nordic style" In 2017, the search volume of the two words showed a trend of paralleling. In 2018, the attention of the Nordic style even had new upgrades.

It seems that the Nordic style is still one of the mainstream styles that consumers are keen on. Then why are the Nordic furniture manufacturers constantly decreasing, and the sales of Nordic furniture are not as good as in the past?

2 Why do consumers choose Nordic style?

Why is the Nordic style so popular? What do contemporary consumers want from Nordic-style furniture?

Let's start with the design. The Nordic style design emphasizes people-oriented, the main features are simplicity, nature, and emphasis on functionality. Contemporary young people face a fast-paced society, and they prefer to have a comfortable life that is simple and simple. This coincides with the design concept of Nordic style furniture.

In the Nordic region, the latitude is high, the light is not rich, and the climate is very cold. Therefore, Nordic designers pay attention to the choice of materials and create a natural atmosphere as much as possible. Natural materials, such as wood, cotton and linen, are the most important choices for Nordic furniture. In the "2018 China New Intermediate Household Consumption Index Report" mentioned above, 72% of people like solid wood. Therefore, Nordic style furniture is easy for them to fall in love at first sight.

In addition, Northern Europe is a region with high welfare and high happiness index. Young people's longing for and pursuit of Nordic life also makes them closer to choosing Nordic style furniture.

From the cause of the reverse problem, we may have found the reason why the Nordic-style furniture companies are cold: these factors that have attracted young people are gradually losing their advantages. Consumers are moving to a home style that better meets their needs, such as the new Chinese style.

3 Nordic style bottleneck

People who care about the new Chinese style and the Nordic style can be said to be mostly overlapping. They pay attention to the design of furniture products, paying more attention to the function, appearance and culture of furniture. This is the first bottleneck faced by Nordic-style furniture: New Chinese furniture has a more natural cultural advantage in the domestic market. In recent years, the country's constant attention to traditional culture has made a new generation of young people pay more attention to and love domestic culture. The pride of big countries is also urging them to turn their attention more to high-quality Chinese furniture brands.

In the selection of materials, the advantages of the Nordic style have become less obvious: most of the new Chinese-style furniture is made of solid wood, and many companies have taken a different approach. The bamboo and paper materials are used to design and manufacture the furniture. The designed products are not only beautiful in appearance. At the same time, it has a traditional cultural charm.

The serious homogenization of the Nordic-style furniture market is undoubtedly its main disadvantage. When the new Chinese furniture companies continue to impress consumers with innovative thinking and original design, many Nordic-style furniture manufacturers have some sluggishness. As more high-quality furniture design and production companies are on the stage, the same "north style" will hardly touch the pain points of consumers, and they will no longer be able to let young people "give up" as they did in the past.

4 Nordic wind market shuffles soon

Profit-avoidance is one of the rules of corporate survival. Faced with the Nordic wind entering the bottleneck, many companies choose to temporarily avoid risks and switch to other markets. The Nordic style market has finally inevitably entered the shuffling period.

Consumers will “vote with their feet” to screen out those companies that fish in the market. If the product does not make a feature, it is easy to become a deserted child. This is true for all furniture companies. The Nordic style market may be even more tragic due to the early frenzied expansion and the long-standing exaggeration.

Although consumers still pay considerable attention to the Nordic style, the Nordic market share has begun to shrink. Of course, all popular styles will face the shackles of market shrinkage and the pain of change. The old American style, the current Nordic style, and the new Chinese style of the future are all the same.

We repeatedly emphasize the importance of design and innovation, because this is the core rule of business survival. In 2015, IKEA China began to explore a variety of innovative ways, such as multi-channel retail, e-commerce, and central store business models, to avoid rigidities. For domestic Nordic furniture manufacturers, design and innovation are also the only life-saving straw.

In fact, the Nordic style should be the most innovative style. Its birth is closely linked to the word "breakthrough". Grasping the word is the essence of the Nordic style. It’s just like a topography, it can only be eliminated by the market. The alarm has been ringing and it is time to change.

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