Consumer psychologist, and friend of the Matt and Jane Show on KIIS 101.1, Adam Ferrier took some time out to explain why IKEA operates the way it does (and why it makes us buy).
Flat Pack Furniture:
“Lots of studies done show that if you co-create or help build something, you’re going to value it even more than if you haven’t,” Ferrier explains. “A study done by a guy called Mikael Norton at Harvard Business School gave half a room fully complete bookcases and said ‘inspect those’, gave the other half of the room incomplete bookcases and said ‘build those’.
“He then said to everybody at the end of the experiment, ‘We need all of these bookcases back for the next group, we’ll buy them off you.’ The people who had made them charged about a 30% premium because they’d invested something of themselves. It’s the same reason why you drag your IKEA furniture from house to house… They tend to warp, chip and look crappy after awhile, and you keep it for a lot longer than you should because you’ve co-created it.”
Ferrier also explained that selling flat packed furniture not only creates a strong connection between consumer and furniture, but it also leads to significant savings for IKEA. “They get to flatpack it and save on shipping costs and all that kind of stuff,” Ferrier says. “So you’re doing a favour for them: you’re completing the job and you value it more for having done that.”
“The second thing is the store design, which is really clever,” Ferrier revealed. “They’ve done so many studies on this, where they heat map people walking through. People tend to complain, but [it means] you don’t ever get to the buying area until the very end.
“By the time you get to the buying area, you’ve invested so much time and effort walking around, for probably say 1.5km, you feel obligated to purchase in the purchase zone… They try to keep you in the store for as long as possible, then at the very end they say ‘You can buy now,’ and you go ‘Oh my God, now I can get out of here,’ so it puts you into a buying frenzy.”
Listen to Adam Ferrier’s complete explanation of the psychology behind IKEA: