• by Sarah Mahoney  @mahoney_sarah, January 18, 2024

Ikea, already a favorite among bargain lovers, is stepping up its value game. Promising shoppers even lower prices, the company is also showing them a new way to shop for furnishings, announcing four new Plan & Order Point with Pick-up locations.

Last year, the company announced a $2.2 billion, three-year investment in the U.S. While that includes 17 of its cavernous big-box stores, which can be as large as 500,000 square feet, the expansion also significantly expands the Plan & Order format.

The company opened its first store with this new concept last year. These stores are much more compact and showcase a smaller range of products. And while customers can’t leave with their items in hand, after making their purchase, they can choose from retrieval options that include home delivery, click-and-collect, and additional pick-up points.

The just-announced openings include a second location in Austin, Texas, one in the Atlanta market, and two planned for the greater Los Angeles area. Ikea previously announced plans to open the new format in Annapolis and Gaithersburg, Maryland, and Katy, Texas.

Ikea, with U.S. headquarters in Conshohocken, Pennsylvania, says U.S. sales topped $6.3 billion last year, a record 6.6% growth from 2022. The retailer also reintroduced its New Lower Price plan, reducing prices on hundreds of products.

It’s also pushing to achieve new sustainability goals, aided by the 2023 launch of As-is online, offering gently used products, and expanding the Buy Back & Resell service to more stores.

Lower prices and used bookcases don’t mean Ikea is giving up those high-style ambitions. As part of an ongoing push toward Democratic Design, it took to Miami Art Week last month to introduce a global collection using an interactive activation. Called "Life Is…," the pop-up featured hands-on experiences showcasing organizational solutions.

Ikea’s bullish moves come at a moment when some observers expect the home-furnishings market to spring back to life. Despite Ikea’s gain, industrywide sales suffered last year. Seth Basham, who follows the category for Wedbush, expects home furnishing sales to gain in the low single digits this year. That will be driven by “a rebounding housing market and improving consumer confidence,” he writes, as well as “a more stable competitive environment.”