Over the holidays I found myself in IKEA shopping for some cheapo furniture. I had not been to an IKEA in about 16 years. It was quite an experience, but what struck me the most was a sign that read (paraphrasing): "Why is there no one around to help me? If we employed more staff to help we would have to charge more for our furniture. That's why."
This struck me as quite remarkable. There are other businesses that aggressively cut costs to provide cheap wares - Wal-Mart being the most notable example. But they don't like to point out to customers where they are cutting corners, they would just assume you didn't notice. IKEA is different and there are signs all over the store that explains exactly how they are saving money and reminding customers that they are passing it on to you.
[This particular sign was apparently just there for the holiday rush because when I went back to take these pictures, it had been removed - dang!]I find this fascinating. You economic behaviorists can help explain, no doubt, but it must be that IKEA has found that by explaining to customers their cost cutting strategies (including he less obvious ones) the customers are more excepting of this cutting of corners. But if they think it is a good idea, why don't other businesses
do it? Airlines, for example, seem like a perfect candidate for this. Heck, US Airways is about to start charging for pillows and blankets! [Insert your joke here about charging for floatation devices]Signs such as this one that seemingly excuses the company for selling furniture that is mostly flat, this other one that apologizes for making you haul it yourself might be seen as just serving to draw attention to areas in which custo
mers might not have noticed. But based on IKEA's success, it must be working.One wonders if it has something to do with the fact that it has, as far as I can tell, one business blueprint for the whole world. It could be that marketers have figured out that Americans don't generally like acknowledging cost cutting but that Europeans don't have the same aversion to it. I don't know a lot about behavioral economics, but I would be interested to know if there is a big difference in behaviors across the pond.
As for me, I don't mind, I was looking for something cheap and efficient, and I got it, the $2.49 kiddie meals came in handy too, and I didn't even mind busing my own table...
