IKEA moves in—how it plans to fill north India’s 'spacious' homes

"Hej, Delhi!" resonated through the Embassy of Sweden as IKEA prepared for its debut in the capital. The Swedish greeting was prominently displayed on standees, posters, and even the team’s t-shirts, signalling the brand’s expansion into Delhi and nine other northern cities. 

Starting March 1, 2025, customers can shop over 7,000 products through the IKEA app, website, and phone assistance as online sales commence. The company offers next-day delivery in Delhi-NCR.

The 82-year-old Swedish home furnishing retailer has expanded into nine more northern cities by providing online delivery to locations such as Agra, Prayagraj (Allahabad), Amritsar, Chandigarh, Jaipur, Kanpur, Lucknow, Ludhiana, and Varanasi.

To support this growth, the company has launched its 180,000 sq ft central distribution centre in Gurgaon in partnership with logistics firm Rhenus.

Ikea is developing a comprehensive expansion strategy in India that encompasses not only online operations but also both large-format and small retail stores.

Ingka Group, the parent company of Ikea, has revealed plans to establish two shopping malls, each featuring an Ikea store: one located in Gurgaon and the other in Noida, both under the Lykli brand.

(Trivia: Lykli is a mixed-use development in Noida, India that includes an IKEA store, hotel, and other retail, dining, and entertainment spaces)

So far, the company has invested approximately Rs 10,500 crore in India. 

Lykli Gurgram spans 1.7 million square feet and features an IKEA store of 200,000 to 250,000 square feet as its anchor outlet, set to open by 2026.

Lykli Noida will feature a million sq. ft. housing area, with an IKEA store of 2-2.5 lakh sq. ft. serving as the anchor outlet, set to be operational by 2028-29. The company is investing approximately Rs 5,500 crore in the Noida centre.

The company currently operates stores in Hyderabad, Mumbai, and Bengaluru.

For further insights, we spoke with Jayendra Gupta, IKEA India’s Country Integrated Media Manager.

According to him, IKEA maintains a consistent product range across markets while adapting to regional needs.

In Mumbai, where living spaces are compact, the emphasis is on multifunctional furniture such as foldable or extendable dining tables. In contrast, north India has a variety of home sizes, resulting in differences in product dimensions. Furthermore, given that many homes in Delhi-NCR include balconies and gardens, IKEA is placing a strong emphasis on its outdoor range in the region.

Gupta says that consumers in north India place a high priority on decorative products. They enjoy greater space compared to cities such as Mumbai, which affects their consumption patterns.

“IKEA offers solutions for every corner of the home with a range of over 7,000 well-designed products. While our core range and messaging remain consistent, we will adapt to consumer trends, demands, and regional preferences, which will reflect in our product displays and storytelling,” he says.

He cites an example in which a brand campaign might evoke emotions that resonate with all Indians, while a campaign tailored to Delhi would reflect the city's unique emotional nuances.

IKEA India presently derives 30% of its sales from online sources and 70% from offline channels.

He points out that a brand campaign might evoke emotions that resonate with all Indians, but a campaign tailored to Delhi would reflect the city's unique emotional nuances.

IKEA India presently derives 30% of its sales from online sources and 70% from offline channels.

In FY24, the company recorded a total loss of Rs 1,299 crore, while revenue from operations increased by 4.5% year-on-year to Rs 1,809 crore. The company reinvested 85% of its revenue in business expansion, while 15% supports the foundation.

Marketing 

To create buzz in the Delhi market, the company launched out-of-home (OOH) campaigns in the Delhi metro, prompting individuals to tag Ikea India's Instagram handle as they expressed their desire to visit Delhi and fulfil their home makeover aspirations.

Gupta says that the OOH campaign sought to generate intrigue and capitalise on the anticipation surrounding IKEA’s entry into Delhi. The initiative integrates smoothly with social media, starting from online conversations, extending into physical spaces, and returning to digital platforms for engagement. The furniture brand is collaborating with influencers to enhance the excitement.

The company will focus its primary media channels for the northern market on digital, OOH, and experiential pop-ups, allocating approximately 70% of the marketing budget to these three mediums.

IKEA will organise three experiential pop-ups, allowing customers to engage with its products and discover tailored solutions. The events are scheduled from February 27 to March 9, 2025, at Nexus Select Citywalk, Saket; from March 7 to March 16, 2025, at DLF Mall, Noida; and from March 24 to April 5, 2025, at DLF CyberHub, Gurugram.

Market competition  

According to PWC, India’s furniture market is currently valued at $16 billion (Rs 1.3 lakh crore) and is expected to double by 2027. The organised segment of the market was worth Rs 50,000 crore in 2019, with projected growth to Rs 1,95,200 crore by 2035.

The northern market is primarily dominated by the unorganised sector, influenced by factors such as a strong business community in which many customers maintain personal relationships with local shop owners, resulting in a preference for familiar purchasing avenues.

Read more: IKEA hopes Indians change furnishing habits; the country marketing manager recounts the hurdles

In light of this landscape, how does IKEA perceive the competition in north India, and what strategic approach does it employ to navigate this market?

Gupta recognises the robust informal sector present in Indian markets, while also highlighting the expansion of organised players. "We welcome competition and believe in expanding the home furnishing movement in India. While some brands focus on discounts, our approach is holistic—offering deals while delivering a 360° consumer experience," he says.

Counterfeiting  

IKEA India’s website states that the company is not associated with any marketplaces or online shopping platforms. However, IKEA-branded products continue to appear on platforms like Amazon, which may mislead consumers.

As IKEA ventures into the North Indian market, how does it tackle the challenge of counterfeit products? Is there a specific communication strategy in place for the brand to increase awareness and address this challenge?

Read more: We don't need celebrity endorsements; Our 9,000 products are our celebs: Anna Ohlin, IKEA India

In all its communication, the company is building a strong memory structure for IKEA’s online ecosystem whether it is IKEA.in, the IKEA app, or our remote customer meeting point for phone shopping.

“We are actively highlighting that IKEA does not deliver through marketplaces. This is a key objective of our marketing campaign, ensuring consumers clearly understand where to shop for authentic IKEA products," Gupta says.

As India's quick commerce sector experiences rapid growth and consumers demand quicker deliveries, these platforms are broadening their offerings to encompass not only emergency needs but also consumer durables, electronics, and skincare products. 

IKEA India is currently engaging in preliminary discussions with quick commerce platforms to find out how its products can be integrated into this model. IKEA recognises significant potential for integration into the q-comm ecosystem, offering hundreds of items priced under Rs 200.