IKEA’s newcomer success story: It all started with a meatball
By: Callum Denault
Published on: December 27th, 2024
Sometimes, the best way to make a business work in a foreign country is not by hiding cultural differences but by embracing them. IKEA is a furniture store that bizarrely made a name for itself by selling Swedish food, particularly its famous meatballs.
The company’s origin story explores human psychology, modern business, and the newcomer experience. Read ahead to learn how a once-struggling furniture store/restaurant hybrid became a global ambassador for some of Sweden’s signature dishes.
Why did IKEA start selling meatballs anyway?
Currently, IKEA’s unusual business model is a screaming success. It is the largest furniture store chain in the world, making $45 billion in sales at over 450 stores globally. Additionally, IKEA makes $2.5 billion by selling food at its various locations.
IKEA started selling food because most of its outlets were located in faraway suburban areas, and its founder, Ingvar Kamprad, wanted to motivate people to stay within their stores. His philosophy was that hungry customers spend less time shopping than people with a convenient spot to fill themselves up. The food was conceived as a lure, allowing it to be sold cheaply, while IKEA only worried about profiting from their furniture sales.
And it worked, with around 30 per cent of shoppers commuting to IKEA just to eat their food. While their most popular item is the Swedish meatballs—nicknamed “sofa sellers” for how many customers they bring in—IKEA also sells different meals. Some options include fish, meat, vegetables, drinks, and desserts, many of which originate from Swedish cuisine.
Initially, the in-store restaurants were a failure, with many customers leaving because they were hungry or thirsty, which defeated the purpose of creating eateries in the first place. In 1985, the company completely revamped its menu, leading to its now-iconic meatballs that have stuck around ever since.
Meatballs: The Swedish dish with an international origin
Despite popularizing Swedish meatballs around the world, IKEA did not invent the dish. It had already been a popular meal in Scandinavia for centuries. Meatballs did not even originate from Sweden, although the Swedes did put a unique spin on the classic dish that became their own.
Four joy meatballs are a Chinese dish traced back to 221 BCE. Archaeologists have also found other meatball-like recipes dating back to Roman times and ancient Iran.
As confirmed by the Swedish government in a tweet, meatballs were brought to Sweden by King Charles XII. He discovered them while seeking refuge in the Ottoman Empire after losing a war to Russia. The king sampled various Turkish dishes and fell in love with meatballs, which his followers supported by adding meatballs to their diets in Sweden.
Since then, people in Sweden have tweaked the meatball recipe to suit their own country’s cuisine, with lingonberry jam being used as a famous condiment.
How IKEA uses consumer psychology as a business tool
Despite being a successful business, IKEA has some flaws that could have prevented it from becoming popular. Except for a handful of smaller outlets, IKEA stores are essentially giant warehouses that are infamously hard to navigate.
This confusing design layout has led to some satire articles and internet memes portraying them as inescapable mazes. While this could deter customers, it actually has done the opposite. Earlier this year, IKEA experimented with new store layouts resembling traditional department stores. However, it was found in customer interviews and feedback surveys that consumers prefer the company’s infamous mazes.
Additionally, most of IKEA’s furniture has to be assembled by the customers themselves, which can sometimes be quite difficult. However, this actually makes customers value their furniture more highly because of the aptly named IKEA effect. People tend to mentally add value to things they laboured over pre-made goods, meaning IKEA’s complex assembly process actually makes their products more popular.
IKEA is an excellent example of how psychology can be used to make a business successful. Between being named for its own consumer effect and its strategic restaurant implementation, IKEA understands its consumer market very well.
Additionally, IKEA’s restaurants amplified in popularity after revamping their menu to prioritize Swedish dishes. By offering customers meals from another culture, IKEA demonstrated the success international companies can have when they incorporate cultural differences into their business model.
For newcomers considering starting their own business, consider using IKEA’s approach. Try embracing your country’s unique cultural elements, including perspectives, dishes, and customs into your operations. Canada is a country that celebrates cultural differences, and by placing yours at the forefront of your business, you are sure to attract customers.