Tuesday, August 02, 2011

IKEA Drama: Second Tier Cities Cannot Wait For Well Known Brands: Enter The Copycat

When I visited friends in several countries, including China and the special administrative region of Hong Kong, I was overtaken by a sense of déjà vu. Their chairs, tables, book shelves, all breathed a sense of Swedish familiarity. Their interiors were completely Ikeanised. To make for a more furniture diverse roomscape IKEA could use some competition. However, the competition should be fair. In the wake of the fake Kunming Apple Store story, Melanie Lee of Reuters reports about a Kunming copycat IKEA with a name that sounds quite similar in Chinese.  

宜家家居 yi jiā jiā jū = Ikea
十一家具 shí yī jiā jù = 11 Furniture
The first character shares the i vowel sound, the third character is identical, the fourth is the same sound, but only pronounced in a different tone.

Also the logo of 11 Furniture uses the same Swedish yellow and blue colour scheme, which indicates a possible trade mark issue. The whole store has the look and feel of IKEA. If one could not read Chinese characters one is easily led to believe one has the IKEA experience. Even the pencils to write down orders and oversized blue bags are present. One can argue that some of these copyrighted IKEA icons are infringed. 

"At least they do not have the unpronounceable Swedish names" quips Forbes magazines. See their 11 Furniture in 12 pictures here

The differences are the products sold, and the fact that IKEA has the goods in stock, although completely dismantled and to be assembled by the customer, 11 Furniture makes the goods on order, so this saves them inventory costs.

What lessons can be drawn from this case?
  • Second and third cities in China are underserved. People in Kunming want affordable furniture and a big choice at one location. Kunming might be a second tier city in Yunnan province, but it has still 5.7 million people. If IKEA is not providing some else will. Of course Ikea cannot build their stores everywhere overnight (in fact one per year in China). But until that time, if they are smart, they could provide shuttle buses to their stores.
  • The fact that 11 Furniture is copying the service instead of the products, could be an indication that China's companies are starting to build a reputation under their own name, although that name is not quite original, yet.
Read also about Dairy Queen knock-off called Dairy Fairy here.

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