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Retail Innovation|April 02, 2019

5 Service Lessons from Ikea’s Manhattan Planning Studio

Ikea’s “planning studio,” to open in April, is bringing the suburbs to the city, which apparently is just where new urban dwellers want it. Here are five ways Ikea is going to redesign the shopping trip.

Today’s city-dwellers don’t merely want suburban comforts and amenities, they want to live a suburban, urban life – and retailers like Ikea are following them into the metro just the way shoppers want them.

How Retailers are Accommodating City Dwellers

Ikea's plan to open the first of 30 small-format “planning studio” locations in Manhattan on April 15 is the latest evidence that retailers are using digital merchandising to assume a new role: inspire purchases with less merchandise and more service. Nordstrom, Casper Mattress, Home Depot and other retailers are applying similar thinking by shoehorning small-format studios into city centers and leveraging their online presence.

These retailers are stepping into the shopper's path without investing in full-line stores. 

Ikea does this by taking the best of what its massive suburban stores offer, shrinking it to apartment size and packaging it as a service. The planning studio will largely cater to shoppers who book consultations with its designers. But shoppers also can pop in to browse its pared-down selection.The city can’t be free of all inventory, however. There needs to be a balance.

Five Urban Retail Concepts Ikea is Doing to Win the Urban Dweller

1. Follow the shopper

It’s simple, and Ikea gets it. For years it has offered bus service to bring city folks to its suburban stores. That may work for décor, but not for wall units, closets, and cabinets (not to speak of refrigerators). Retailers that want to be relevant to city dwellers need to have a physical presence to prevent becoming an afterthought, and services that acknowledge that city living requires accommodation.

2. Adapt to their urban retail needs

Moving to the urban core signals more than a lifestyle change, it forces a wholesale change in day-to-day living, from the daily commute to what fits in the fridge. City retail inventories should reflect city living spaces: Highly functional, space-efficient and stair-friendly. Think made-to-assemble couches, stackable refrigerators and anything with hidden compartments.

3. Keep small spaces in mind

New York City apartments average 700 square feet, requiring smart space management. And decisions: Cleaning products or sweaters? Crock pots or wine glasses? The sales value of an urban kitchen may not be as high as that of a suburban kitchen, but in a city block there are many more kitchens, and this is what Ikea is counting on.

4. But dig deep and get creative

A selection of smaller items does not have to mean a small selection. Home Depot’s urban locations use peg boards to display more items vertically, replace the gardening section with houseplants, and sell essentials from tools to appliances, but in smaller sizes.  It also offers what most city dweller’s prize: same-day delivery.

5. Think like a freelancer

The city is chockablock with entrepreneurs ready to fill the service void of big retailers, from designing within small spaces to picking up furniture and assembling it on site. Retailers can seal these cracks in the service infrastructure by handling such tasks themselves – Ikea’s Planning Studio, for example, will offer design, delivery and assembly services.

There’s room for all retailers in tight urban spaces. They just need to think like the shopper when making the most routine, daily decisions. Because living in the city really is a lesson in creative choices. Know yours.

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