The Swedish furniture retailer has seen a change in the consumer market since it arrived in the U.S. in the late 1980s. Ten to 15 years ago, consumers tended to buy furniture for a lifetime, but today "they're more interested in finding something that fits with their lifestyle now," says Rich D'Amico, new-business development manager at Ikea North America.
And that's good news for home-oriented retailers, which are in land-grab mode, scooping up consumers driven shelter-mad by low interest rates and a growing fascination with home design. Hardware stores are chasing women, home decor shops are attracting metrosexualized men and everybody is trying to win a growing multicultural market.
"People have gotten into decorating their homes and have become more savvy about how they can accessorize," says Julie Gardner, senior VP-marketing of Kohl's Corp. The retailer, while still mainly focused on apparel, has recently reset its stores to improve its housewares and home displays.
Consumers' view of home decor has changed from a once-in-a-lifetime project to an evolving fashion sense, driven by the specialist stores, says Gwen Morrison, president-North America at The Store, Chicago, a WPP Group agency specializing in retail.
"Over the last decade, there's been a more casual approach," says Ms. Morrison. "The Crate & Barrels of the world have driven this change ... we're not just eating sushi at home. We're serving it on Asian plates."
In that context, brand identity can mean a lot to a retailer. Each successful housewares brand has an image-Pier One Imports is ethnic, Williams-Sonoma's Pottery Barn is modern and Euromarket Designs' Crate & Barrel is classic-and shoppers choose each store based on what look they're going for, says Jim Lucas, director-planning and research at Interpublic Group of Cos.' Draft, Chicago. "It's more the age of the specialist," he says.
Other retailers have also stepped up their activity. Hardware chains such as Home Depot have remade themselves into "home centers," evolving from selling only products for "behind the wall"-plumbing, lumber, electrical supplies and the like-to adding more merchandise for "in front of the wall," such as paint and decorative items, says Mr. Lucas.
In the midst of this ferment, department stores "had a run for their money, having to retool to compete," says Ms. Morrison.
Some retailers have created house brands to give them an advantage, such as Target Stores, which pioneered the democratization of design with housewares lines by architects Michael Graves and Philippe Starck, and has continued with designer Todd Oldham.
Others are trying new store concepts dedicated to home improvement and decor, such as Sears, Roebuck & Co.'s The Great Indoors and Federated Department Stores' Bloomingdale's Furniture.
The makeup of the consumers has also changed, with couples making more home-improvement decisions jointly and women becoming more involved in projects. John Costello, exec VP-marketing and merchandising as well as chief marketing officer of Home Depot, notes that half the visitors to his stores are female and more than 40% of store visits are made by couples shopping together.
The consumers are also increasingly multicultural. Even as the nesting trend may be cooling off, the demographics favor minority groups and women, Mr. Lucas says. He notes home ownership rates among single women, African-Americans and Hispanics continue to grow.
"If I'm a Lowe's or a Home Depot, these are the people I want to reach out to," he says.
And they are. Ikea recently hired its first Hispanic agency and Lowe's Cos. hired a trio of agencies to handle multicultural advertising. Home Depot had done Spanish-language ads for years, says Mr. Costello, and it has placed bilingual signage and Spanish-speaking sales people at stores in key markets as part of efforts to reinvigorate the brand.
"The U.S. has clearly become a multicultural country, and we're committed to meeting the needs of all our customers," Mr. Costello says.
Faced with all these changes, marketers are increasingly using non-traditional media such as product placement to reach consumers. Catalogs, store design and sponsorships are now just as important as ad campaigns, say the experts. "The store plays a large role with these guys because a lot of what they sell is experiential," says Mr. Lucas. "They've ended up being lifestyle editors."
For the home decor stores, such as Pier One and Crate & Barrel, that ability to create theme displays has helped attract men, who are increasingly interested in entertaining at home, Ms. Morrison says, adding, "The stores have gotten better about how to present a story. ... like Crate & Barrel saying, `It's time for grilling.' "
Catalogs have also become an important tool to introduce or reinforce the brand. Experts point out catalogs allow a retailer to present its brand in a leisurely fashion to a consumer relaxing at home, not hurrying through a store.
Catalogs can be very effective brand builders, Mr. Lucas says, noting, "It tells you what the brand is about."
And, in a sort of chicken-and-egg situation, home improvement TV shows have both created more demand for shelter retailers and helped them reach those interested consumers.
"Home improvement shows have become a substantial source of information and aspiration for consumers," says Mr. Costello. Home Depot has sponsorship deals with the two top-rated home improvement shows, TLC's "Trading Spaces" and "While You Were Out." Those deals include extensive product placement, advertising and in-store events.
"You have the opportunity to get the right products in front of the consumers when they're most receptive," Mr. Costello says.
"It's a `That's for me' kind of thing," Mr. D'Amico says. Ikea has done product placement in movies, such as the upcoming "Jersey Girl" from Miramax Films, and on TV shows such as Bravo's "Queer Eye for the Straight Guy," which featured a shopping excursion to Ikea as part of a recent episode.