Global home furnishing giant IKEA is accelerating its China expansion, with new store openings, diverse formats and bigger investments, according to Anna Pawlak-Kuliga, CEO of IKEA China.

IKEA on its new China strategy

The Swedish retailer recently announced an ambitious China strategy in fiscal year 2020, investing 10 billion yuan (about 1.4 billion U.S. dollars) in the country and hiring 3,000 employees in 12 months.

"We have a strong confidence in China market overall," the CEO said. The company has been in the Chinese market for over 20 years, witnessing the change in taste for home furnishing in the country. Therefore, IKEA is trying to move on in the market "with speed, with a fresh approach."

"We would like customers to not only buy products and services [in IKEA]. It's all about stories, about fulfilling the dreams, about the magic, and about building a relationship with the customer nowadays," she told CGTN.

IKEA now operates 27 stores in the market. As part of its ambitious plan, the company will open four new stores in the next four months – which never happened before in any market, the CEO said, stressing that "accessibility" is the top priority for IKEA's strategy in China.

"I'm very happy also to share with you that in China we will establish a product development center that our product to be co-created together with the customers. [The new center] not only meets customers' needs, but also exceeds their expectations," she revealed.

Moreover, she hasn't seen any direct impact from China-U.S. trade disputes, but has observed that "interest in home furnishing is increasing consistently," voicing optimism about a double-digit sales growth next year.

"We are adjusting and we are transforming at the same time. We have strengths to build on and we have ambitious plans. And I strongly believe that the strategy we have will be able to unleash potentials in the market and we'll be able to meet Chinese customers in the future," the CEO noted.

IKEA on smart home trend and homewares' pain points

The CEO regarded China as a market that is leading the trend for many sectors in the world. “We are fascinated by the Chinese customers in the way they shop,” she said.

The smart home, for example, is a trend that IKEA is moving fast to catch up on. Last year, IKEA teamed up with the Chinese consumer technology brand Xiaomi in developing smart home products.

"We see it as an integrated part. We are also open for partnerships. I think if we join forces, we can be much faster and much better in execution as well. And we can learn from each other a lot," the CEO explained.

Meanwhile, she considered storage, cooking and sleeping to be the three biggest pain points in terms of homewares in China. And IKEA is trying to take a look from a much higher perspective – how people live and what they have trouble with.

"And we don't take it only from the perspective of home furnishing design, but also what solutions to the home we can provide, what education we can give and what knowledge we can share with them, to let them have better life in totality as such," she added.

IKEA on omni-channel approach and e-commerce

IKEA is popular for its large walk-in facilities with spacious furniture displays and in-house restaurants. But she observed that "If you're not able to buy online on your mobile, you don't buy."

Therefore, she highlighted the importance of digitalization, arguing that IKEA's strategy is "to infuse and to combine online-offline integration together as one, but provide the brand experience for all the channels in a way that we have never done before."

And the CEO is bullish on omni-channel approach to provide more touchpoints. "And technology will be enabling many journeys when we come to the customer needs, and the customer will be able to choose how to shop, where to shop, how much time they want to spend on shopping."

And she said IKEA is exploring every option and will not exclude any possible cooperation in the future.

"Transformation is topic very common across all the industry in the world. It's invisible to change. But I think the trick is that how much effort you put into speed, quality of execution and being brave for the future," the CEO asserted.

IKEA on sharing economy and recycling

Furniture rental is part of IKEA's effort to overhaul its business model. IKEA plans to test a range of subscription-based leasing offers in all 30 of its markets including China by 2020 so products are reused as often as possible before being recycled.

"We are exploring also many ways how we can provide better lives to the many people who have thin wallets as well. So it’s not only about the selling, it's about renting, it's about a sharing economy," the CEO said.

Meanwhile, she regarded sustainability as "a guiding star in what we do." She shared with CGTN that IKEA has a very ambitious plan about "how integrate our business model is into the society. So we have respect toward the planet and as well we have respect towards the environment."

"So we can leave the Earth as a heritage for our children in a very good shape, and I think it is time to act," she said.