The Japan NewsAs Swedish retail giant Ikea provides customers worldwide with stylishly designed home furnishings, Ikea Japan K.K. (see below) chief Helene von Reis focuses on local relevancy in Japan. She recently spoke to The Japan News about her experiences and thoughts.
Q: You were born in Sweden, but you’ve had many experiences in different countries. What do you keep in mind when working with Japanese employees?
A: I think first of all, we are all human beings, so I don’t really try to think too much about [the fact] that I am in Japan, or I am in China, or I am in the United States. We have all chosen to work with Ikea. Ikea is a very values-driven company, so we have our Ikea idea of what is right and what is wrong, and that works in every country, to be honest. I can always relate to the Ikea values, and it’s my framework, how we behave with each other, if that is in China, in Japan or any other country. So that really helps.
Then, I think at Ikea we really respect everybody for who they are, so it’s not so much about you have a high manager or low coworker, part-time, full-time — and that is also global. So it’s kind of easy for me to try to see everybody just as coworkers. I see myself as a coworker also. This can, of course, be a little bit difficult also because when I come people think, oh, the president or the CEO is coming. For me, it’s not that. I’m just Helene and I started in Ikea as a part-time coworker. I think this is the way I try to do it.
Q: What is the key to overcoming differences in people’s thinking in different cultural environments?
A: The openness. To be open to that there is more than one way. And the ability to listen, I think. You have, of course, an idea of, OK, I think this is the way that is the right way based on all of this. I think it’s this way, but if you are not open to listen to what the other people around you think, it’s impossible. It’s not so difficult for me to say, OK, then let’s go this way. So I think that this openness is the key.
Q: In 2016 you became the chief executive officer of Ikea Japan. What are some of your thoughts on Japanese customs and culture?
A: If you take it from an Ikea perspective on consumer behavior, I think that Japanese consumers are very used to high-quality service. So I think that the service expectation is higher in this country than it is in any other Ikea country. That for us is very obvious as a difference in Japan than in other countries.
Also, the fact that not so many people have a car in all markets. I mean, in Nagakute, Aichi Prefecture, it’s fine because everybody has to [have a car], but if you take Tokyo, for example, not so many people have a car, so the Ikea concept as such has to be a little bit adjusted to meet people’s needs. In Sweden, the idea is you come to Ikea, you buy it and you take it home yourself, but in Japan it’s the opposite. So we need to make sure that people feel they can shop in Ikea and get the services that they want.
Then, I also have to say — this is a global development, it’s not only in Japan — but it is very clear here that we cannot rely on people having cars.
Q: Ikea once withdrew from Japan, but it reentered the Japanese market in 2006. It has expanded to nine branches. Is it difficult for you to gain a share of the Japanese market because, even now, Ikea’s share of the Japanese market is relatively low?
A: First of all, yes, it is difficult for a foreign company to get a foothold in Japan. I think we have seen many companies come and think that they can do business the normal way and then leave. You also see some good examples, though, of companies that have succeeded. You look at Starbucks — very successful. You look at McDonald’s — very successful. What is the key? Apart from the fact that it’s food, and Japanese people love food and new things, we also have great food in Ikea, which actually helps us a lot. Food is a success factor in Japan, if you do it right.
But I think apart from that, the local relevancy is the issue. So Ikea comes all over the world with global solutions, right? And that’s really good and bad. So the bad thing is, of course, that you love to go and look at it, so people come to our stores and they look at all the beautiful things and the good ideas, and then we say, OK, would you buy this for your home? Oh, no, it’s not really for me, I’m Japanese, it’s too much color, or it’s too big, or it’s not the right function for me. So that’s where we go wrong. People love that it’s international and Swedish and beautiful and all of this, but it doesn’t mean that people will buy it. So local relevancy is the key. We need to sell solutions and products that work for Japanese homes.
Q: The company announced that the prices of 9 percent of all items have been cut by an average of 22 percent. What kind of effect did this have?
A: Of course, it’s an investment that we do as a company to attract and we can clearly see that out of all the products we invested in it’s very obvious that some products are more attractive with the lower price than other products. It is actually a good exercise to see also which of the range that we have is the most attractive for the consumers. So I think we had a lot of learning in that. It worked really well for us to understand also what is the Japanese consumer attracted by and then to build on that for further investments. So that is what we will do. We will focus on the areas where consumers have a sensitivity to price.
Q: Will you continue this price-cut strategy?
A: Yes, we will develop it further and continue it, but it needs to be more focused. We did very many products last year. Going forward, we will focus deeper on the categories where there is more sensitivity to price.
Planning to be in city centers
Q: How will you enhance consumers’ motivation to buy your products?
A: Consumer behavior is changing very quickly, so accessibility is totally key. We need to have these big, beautiful stores for inspiration, and for people to come and experience Ikea in a really good way. Then we also need to be in the city centers, where we are not today. So we absolutely are planning to be in the city centers in Japan and that is something we are working very hard on.
Then, that said, online of course is also super-important to us. We keep developing our online business and step by step the website will also get better. So, it’s these three components that are the future: online together with offline, and then the accessibility. And then if I had to add one more thing, I would say it’s the range relevancy, to meet the people with the right range.
Q: You have experience working at a product development division in Sweden. Will you contribute to developing original products for the Japanese market by using your experience?
A: Yes, we actually do that today. So there is a part of Ikea’s product development that is more locally oriented where you base the product development on the local needs. For example, we can send a business case and say, OK, we need smaller sofas for Japan and they need to look like this. So then it goes in, to Ikea Sweden, and then they process that. And right now, we are working very hard on a small-space living range. We know that a small-space living range is perfect in Japan, right? But it’s not actually perfect everywhere where you live in a small space. So we’re very active in our collaboration together with Ikea Sweden on using Japanese dimensions of small-space living as input for a range that works for really small spaces.
Q: Which company do you think of as your competitor in the Japanese market?
A: I actually don’t think it’s a company, I think it’s time. Our time is the biggest competitor because we live such busy lives, and we commute and we work, and we have family life. I think we all compete for the time. I think any company today competes for the 24 hours of my time.
And if time is my competitor, then I need to look at it, right? So then I say, OK, if you want people to go to Tokyo Bay and shop, if you live here it’s easy, but if you live farther away, it’s too far. So it’s not Tokyo Bay that’s the problem, the problem is the time that it takes to go to the store. So time is our biggest competitor and the value of time.
Q: Ikea has consulted with ergonomics and long-term care experts and started a new design series called Omtanksam. This year, Ikea Japan began to sell some products from this series. Will you be expanding its range?
A: Yes, absolutely. We just started and we can see fantastic response from the consumers. All the products we had were sold out in one day. So we are now working on adjusting the sales forecast of this product series. We were not sure how it would be approached by people, but it is really super-good quality products and they will absolutely sell very well in Japan and in many other countries, too. We strongly believe in this, and it will expand, so during the fall we will get more and more products coming in this series.
Support women to take next step
Q: How will you improve your company’s work-style for women and expand day care centers in the near future?
A: The thing with women is that you need to listen to them, you need to listen to their needs, so you also need to be a little bit flexible. It is not a problem to create a little bit of flexibility. You need to be not completely square in your thinking. So maybe women need another type of shift, like, they can work certain hours, but not other hours because the children come home from school. You need to adapt a little bit to that. Then, of course, you also need to make sure that, as there is no tradition of female managers in Japan — women in Japan also do not necessarily push themselves for a career — you also need to see them and say, “I think you can be a manager. If we support you, I think you would be a great manager.” So it’s also a little bit your approach to women, to support them to take the step. This is actually a lot about men also, that male managers need to see the women and say, “I believe in you, let’s listen to your needs and help you.”
Then when it comes to day care, we want to absolutely support through day care, so our plan is for next year to open one more day care in one of our stores and we are working on it now.
Q: Your family also came to Japan. What are their impressions of Japanese culture and customs?
A: They feel very comfortable here and very safe. I have two children and it’s a very safe city to live in, Tokyo. I have a teenaged daughter, so of course you are concerned, is she safe when she’s out with her friends? And we feel that safety is a super-strong strength for Japan, in these times also. So, I think that is something that we all sense and feel.
Then I think the children also appreciate the structure. It’s organized and you can understand, you can take the train and you know when it will go and you know how it will go and you can feel OK with how you manage. I think we really appreciate that also. Also the respect, there’s a respect among people, which is a good feeling.
— This interview was conducted by Japan News Staff Writer Etsuo Kono.
Helene von Reis was born in Malmo, Sweden, in 1969. After graduating from Lund University in Sweden, she joined Ikea Communications. She later became managing director of Ikea Communications after serving as an information manager at Ikea of Sweden. In 2011, she became the store manager of the Shenzhen branch in China, then in 2013 she became a deputy retail manager of Ikea U.S. Since 2016, she has been president and chief executive officer of Ikea Japan K.K. She lives with her husband, son and daughter.
■ Ikea Japan K.K.
Ikea Group is a leading home furnishings retailer with 355 stores in 29 countries worldwide. In its fiscal year ending August 2017, 817 million people visited its stores. Ikea was founded in Sweden in 1943 by Ingvar Kamprad when he was 17. Ikea Group’s total revenue was €36.3 billion in FY17. Ikea reentered the Japanese market in 2006 and Ikea Japan K.K., its subsidiary in Japan, opened its ninth store in October 2017. In FY17, Ikea Japan’s revenue was ¥74 billion. Speech