Why Ikea Is Buying A Tech Company
Entertainment By Elena Boaghi | October 1, 2017
Ikea is creating an Ikea-free experience. Yesterday, the Swedish furniture and lifestyle company acquired the gig-economy platform TaskRabbit, which will continue to operate as an independent company. The end goal is likely to use TaskRabbit’s established platform–which lets people pick up odd jobs and tasks on-demand–to make it frictionless for Ikea customers to hire someone to purchase and assemble their furniture for them.
The acquisition is just the latest in a series of moves by Ikea that show it evolving into a more tech-savvy company. Over the past year, Ikea also developed more connected products (including software), launched an augmented reality shopping app, and said it would start selling through third-party online retailers (Amazon and Alibaba are rumored to be in consideration). Together, it could drastically change what it means to shop Ikea.
Ikea has a very particular user experience. You travel (often far) to one of its massive blue box stores. You walk through faux living rooms, kitchens, bedrooms, and bathrooms, scribbling which products you like on a piece of paper before going into the warehouse and physically hauling boxes onto a cart. Then you load everything into your car, drive home, and build it yourself. The entire experience is grounded in physically being in the store for long periods of time–good thing there’s a cafeteria and daycare!–and performing the labor yourself.
That’s beginning to change. Ikea is moving from a you-do-it-all to a tech-does-it-all approach, where you won’t have a lift more than a finger to buy a new living room–and you can do it all from the comfort of your current living room.
Instead of driving to a brick-and-mortar store and arguing over whether or not lacquer or natural wood is a better fit, you can use Ikea’s new augmented reality Place app to figure out if a piece of furniture will look good in your home. Instead of slogging through Ikea’s labyrinthine warehouse, you place your order online. And instead of spending hours with a hex wrench and a mountain of cardboard, TaskRabbit picks everything up and builds it for you.
While Ikea did not release specific details about how this acquisition will precisely impact consumers, its pilot of a Taskrabbit partnership in London offers hints at what’s to come: Namely, fixed prices for specific types of assembly and guaranteed workmanship, which is just as beneficial for you as it is for Ikea. You know you won’t be receiving ham-fisted labor, and Ikea knows its products will be built and secured to their safety requirements.
In a press release, Ikea CEO Jesper Brodin hinted at the pressures contributing to this newly tech-forward approach: “As urbanization and digital transformation continue to challenge retail concepts, we need to develop the business faster and in a more flexible way.”
While Ikea devotees will still head to stores for the in-person experience, the reality is that reaching more consumers involves e-commerce. Real estate is expensive, and Ikea can’t just keep building mega-stores. Ikea’s own in-depth trend research points to a rise in urban dwellers, which means its potential consumers are in cities and don’t own cars, adding another layer of difficulty for growth.
The future of Ikea is all online–except, maybe, with regards to its meatballs.