Ikea projects online sales will grow fivefold in a half-dozen years
October 14, 2015 03:00 PM
Ikea is looking to build online sales, and fast.
The Swedish furniture retailer, formally Inter Ikea Systems BV, will increase online sales from 1 billion euros annually today to 5 billion euros within five to six years, CEO Peter Agnefjӓll says.
He says Ikea is testing a new front end for its e-commerce sites in Ireland, and eventually will roll it out to other countries. Ikea sells online in 13 countries, including the United States.
“But the big thing is to build the machinery behind the scenes to get all the logistics going, and that’s a journey we’re just on,” Agnefjӓll said today in an interview on cable news network CNBC. While he said the retailer’s online sales are now 1 billion euros ($1.15 billion) per year, a bit under 4% of revenue, “it will be 5 billion in five, six years. But, of course, a lot of things have to happen behind the scenes.”
Agnefjӓll acknowledged that Ikea was late to e-commerce. “We could have been faster,” he said. But he said not being sooner in e-commerce has allowed the retailer to skip earlier stages of technology investment, for example, by now deploying technology that caters to the growing numbers of shoppers accessing Ikea.com on mobile and on tablets instead of on traditional computers.
Ikea, No. 67 in the Internet Retailer Europe 500, which ranks retailers by their online sales in Europe, reported 30.1 billion euros ($34.5 billion) in total revenue in its fiscal year that ended in August 2014. That is the last financial report issued by the privately held company.