Ikea - Easyjet: a common low-cost concept

Abstract

How is the choice of a comparison between two companies which are not operating in the same segment motivated? Indeed, nothing (or almost nothing) seems common between Ikea and EasyJet, except that 'if you look closely, you can perceive a common basis, a concept that both companies have made their own: the "low cost"'. At various times during the introduction (1943 to Ikea®, 1995 for EasyJet®) and in different ways (the precursor to Ikea®, follower for EasyJet®), these two companies have integrated into their development policy, fundamental innovation that represents the "low cost". More of an innovation in terms of product, it is related to an innovative concept in which these two companies overlap in a common goal: to grow, gain market share and create new application.

The development of the concept is extreme (by offering prices as low as possible by whatever means) and both companies aim to become indispensable entities in their respective markets. The comparison becomes more visible, as each takes advantage of its own innovation to become "low cost". This file is intended to demonstrate the means by which the risks taken have paid off, because it is necessary to emphasize that most companies which are an economic phenomenon, (the "low cost") also have a strong footprint in the social and attitudinal changes.

This file is intended to demonstrate the means by which the risks taken have paid off, because it is necessary to note that more than an economic phenomenon, the "low cost" also has a strong footprint in the social and attitudinal changes.

In the context of the post-war market for the distribution of furniture is much divided. This is particularly the case in Sweden where companies are organized in a cartel to fix the barriers to entry and limit competition, especially the price. Thus, over the period 1935 to 1946, prices have risen steadily. This excluded from the market low-income clients.

It was not until the '80s and particularly the impact of the phenomenon of baby-boomer demand evolves in parallel to supply the market. Indeed, the tradition of intergenerational transmission of furniture is lost and gives way to new behaviors. Now the concept of "design quality and low price" attracts new generations. Ikea® is part of this new type of offer by proposing a less expensive furniture, but renewable, and changed the face of the traditional sector of the furniture.

EasyJet® is not the first airline to have proposed a transport service at low prices. Southwest Airlines®, based in Dallas, launched this concept in the U.S. market in 1973. But EasyJet® is not the first low-cost airline to have originated on the European market since it was created on October 20, 1995. While the Irish airline Ryanair®, now a leader in this category, it was founded 10 years ago.

Ryanair® has developed a strategy to reduce costs by flying to secondary airports. It may well include the airport of Beauvais in the case of France, which is considered the "starting point" of Paris.

Like the baby boomers to Ikea®, it is important to note that in the case of the airline market, it is the deregulation of transport in Europe from 1997 that allowed the explosion of the phenomenon of companies with low price. The European Commission now in effect allows the airlines to operate at any EU airport, and thus ends the monopoly of national companies (majors) on key domestic routes.

Tags: Ikea, EasyJet – low cost airline, Ikea – EasyJet as a low cost concept