On November 25th, Swedish furniture discount store Ikea challenged the booming e-commerce and online shopping trends in Southeast Asia and opened its world’s largest store in the Philippines. This is the cornerstone of the home furnishing giant’s plan to expand its physical stores in Asia .
The store occupies more than 65,000 square meters or about 10 football fields, which is larger than the Palace of Versailles in France or the Hermitage in St. Petersburg, Russia-giving the impression of the huge scale of the facility. It spans five floors and is located in a complex of buildings adjacent to Manila Bay.
The complex has two storeys with showrooms and food courts, as well as warehouses, e-commerce facilities and call centers. It was built on a property leased by SM Prime Holdings in the Mall of Asia in Pasay City.
The booming middle class, young professionals spend money on houses and furniture
IKEA stated that this store is the first store in the Philippines, and it is very suitable for this high-growth country and the booming middle-class young professionals who want to spend money on fashionable furniture in their newly-purchased homes during the real estate boom-despite Facing the challenge of the Covid-19 pandemic and the strong trend of e-commerce.
In other words, IKEA has always acknowledged this trend and expanded its e-commerce business, with online orders now accounting for 26% of its global sales.
However, the company has more than 460 physical stores in approximately 60 markets around the world, but it still plans to add nearly 60 stores in the current fiscal year ending August 31, 2022, not only in Asia but also in South America.
“Retaliation consumption” during the Christmas shopping season
The Manila store was originally planned to open in 2020 but faced delays due to restrictions on movement caused by Covid-19 and interruption in the supply of construction materials. Although IKEA predicts that 2022 will face a more difficult year, due to the logistics congestion brought by the pandemic and soaring raw material prices, the Philippines made its debut.
At present, the number of shoppers in the new store is limited to half of the total capacity of 8,000 people. As a precautionary measure for Covid-19, they must also register a position on the IKEA website.
In the Philippines, IKEA expects that in the next one or two years, as Filipinos rebuild their savings, spending will slow down, but as the pandemic subsides, consumer confidence will gradually improve. Nonetheless, the company believes that during the various lockdowns of the past 20 months, people may make some kind of “retaliatory spending” in the near term, and they venture back to the outside world during the Christmas shopping season.
On November 25th, Swedish furniture discount store Ikea challenged the booming e-commerce and online shopping trends in Southeast Asia and opened its world’s largest store in the Philippines. This is the cornerstone of the home furnishing giant’s plan to expand its physical stores in Asia The store occupies more than 65,000 square meters or about 10 football fields, which is larger than the Palace of Versailles in France or the Hermitage in St. Petersburg, Russia-giving the impression of the huge scale of the facility. It spans five floors and is located in a complex of buildings adjacent to Manila Bay. The complex has two floors…
On November 25th, Swedish furniture discount store Ikea challenged the booming e-commerce and online shopping trends in Southeast Asia and opened its world’s largest store in the Philippines. This is the cornerstone of the home furnishing giant’s plan to expand its physical stores in Asia .
The store occupies more than 65,000 square meters or about 10 football fields, which is larger than the Palace of Versailles in France or the Hermitage in St. Petersburg, Russia-giving the impression of the huge scale of the facility. It spans five floors and is located in a complex of buildings adjacent to Manila Bay.
The complex has two storeys with showrooms and food courts, as well as warehouses, e-commerce facilities and call centers. It was built on a property leased by SM Prime Holdings in the Mall of Asia in Pasay City.
The booming middle class, young professionals spend money on houses and furniture
IKEA stated that this store is the first store in the Philippines, and it is very suitable for this high-growth country and the booming middle-class young professionals who want to spend money on fashionable furniture in their newly-purchased homes during the real estate boom-despite Facing the challenge of the Covid-19 pandemic and the strong trend of e-commerce.
In other words, IKEA has always acknowledged this trend and expanded its e-commerce business, with online orders now accounting for 26% of its global sales.
However, the company has more than 460 physical stores in approximately 60 markets around the world, but it still plans to add nearly 60 stores in the current fiscal year ending August 31, 2022, not only in Asia but also in South America.
“Retaliation consumption” during the Christmas shopping season
The Manila store was originally planned to open in 2020 but faced delays due to restrictions on movement caused by Covid-19 and interruption in the supply of construction materials. Although IKEA predicts that 2022 will face a more difficult year, due to the logistics congestion brought by the pandemic and soaring raw material prices, the Philippines made its debut.
At present, the number of shoppers in the new store is limited to half of the total capacity of 8,000 people. As a precautionary measure for Covid-19, they must also register a position on the IKEA website.
In the Philippines, IKEA expects that in the next one or two years, as Filipinos rebuild their savings, spending will slow down, but as the pandemic subsides, consumer confidence will gradually improve. Nonetheless, the company believes that during the various lockdowns of the past 20 months, people may make some kind of “retaliatory spending” in the near term, and they venture back to the outside world during the Christmas shopping season.
