David Rosenthal: belief

Transcript context

…And you might ask yourself, what’s the big deal with the catalog? Why are people so interested in getting a catalog? It was really inspirational. It hadn’t quite made the shift yet, but especially in the 60s after Brita Lang took over from Ingvar, because Ingvar is everything right now. He’s art directing the photography. I think he might even be taking the pictures and writing the copy. But it turned into this thing with these vibrant, beautiful living room settings, and people are anticipating the arrival of the IKEA catalog. It positioned IKEA as this brand, this lifestyle. It illustrated a life you could be living if you participated in the IKEA story. That really, really becomes a thing in the 60s with modernity and when the target customer becomes the urban and suburban customer. But here, even with the rural customer, it still works. They lean into this model heavily. They arrange for any IKEA customer to get discount tickets on Swedish railways to make the pilgrimage to Älmhult. Then they also set up this program where customers who come from another location and commit to furnishing a whole house—they call these the setting up house customers—they get free dinner at the hotel in Älmhult that night. This is hokey stuff, but to your point, P.T. Barnum. That’s what this is. Within a year, they pass one million krona in sales at this showroom, which has got to be by multiples the largest business ever built in Älmhult in human history. In 1954, the next year after this has been open, they passed three million krona in sales. I think the exchange rate was about 5:1 at this point in time of five krona to $1. 1955, they double again to six million krona in sales. The number of IKEA catalog subscribers around the country passes half a million. All this is done with still less than 30 employees, the business still being run out of the combination of the family farm and this one showroom. It’s wild the scale they get to. It’s amazing. It’s one of these things that on the one hand we are, how many years into IKEA? Was founded in 1943 and we’re approximately in 1953–1954 here, we’re 10–11 years in. But the thing that is really working is this thing that just got started the previous year, which is the combo of the catalog and the showroom. That proves to be this amazing winning combination that they just realize, oh my God, we need to scale this.…

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