The first IKEA city-centre “Planning Studio” has opened in London, marking a new approach for the Swedish retailer, famous for its flatpacks and out-of-town warehouse-sized stores.

The launch is part of the furniture giant’s ambitious strategy to reach three billion customers by 2025.

The “Planning Studio” concept is designed to complement the brand’s rapid online growth. Earlier this month, IKEA announced that online revenue was up 31% in the year to August, while existing store sales had plateaued, Retail Gazette reported.

Planning Studio stores will offer shoppers a more intimate experience than is possible in IKEA’s larger outlets. Staff will give advice and inspiration to customers, who can then order online.

“Our new city-centre approach brings IKEA into the heart of London and is designed to complement our larger stores and digital offering,” the company’s London city centre market leader Jane Bisset told Retail Gazette.

Globally, the retailer, which has 11 franchisees in 50 markets, opened 19 new outlets in the year to August, taking its total to 422.

This included its first store in the Indian market. By 2020, IKEA plans to have launched stores in Chile, Columbia and Peru, and then has eyes on Mexico, Estonia, Ukraine, Puerto Rico, Oman, Luxembourg, the Phillipines and Macau.

Group chief executive Torbjörn Lööf told Retail Gazette, “By 2025, we have the potential to reach and interact with three billion people.

“We will offer new and different ways to shop the IKEA product range – online, in remote locations and in city centres.

“We will introduce smaller store formats and offer a wide range of flexible and affordable services.”

The city-centre model is at the heart of the new strategy, which IKEA said in April would be a part of a “transformation of our business” aimed at keeping up with changing consumer habits.

It plans to “claim city centres” by opening Planning Studio stores in 10 key cities, including London, New York and Tokyo.

In the 12 months to August, IKEA saw sales rise 4.5%, up to €38.8 billion, with online sales now accounting for around 8% of total turnover, a jump of 31% on the previous year.

Sourced from Retail Gazette; additional content by WARC staff