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Ikea wants to use its new store on London’s Oxford Street to attract more city dwelling customers as part of a strategic shift to expand beyond giant out-of-town warehouses.
The shop, which will open on Thursday, is part of a plan to make the brand more accessible for customers living in cities.
Jesper Brodin, who runs Ingka, the group that operates 90 per cent of Ikea stores globally, said the shift was prompted by conversations with shoppers a few years ago.
“People said ‘we like Ikea, but on a weekday it’s difficult for me to get to Wembley’,” the chief executive said, referring to its vast shop in north-west London. “It was a realisation that we had to invest in digital and online but also that we had to find a way to bring Ikea closer to customers.”
The Grade II listed Oxford Street building, formerly the flagship unit of fashion retailer Topshop, has three floors and the equivalent of 5,800 sq m of retail space.
About half of the 6,000 products on display, spanning storage boxes, plush toys and crockery, can be bought straight away, while larger items of furniture will be available for home delivery or click-and-collect.
Ikea paid £378mn for the building in 2021 before investing tens of millions of pounds to renovate it in what amounted to Ikea’s “biggest investment by far” in a single shop, Brodin said.
“I’m quite confident that Oxford Street will work but also that we will continue to scale in more big cities,” he added.
Ikea opened its first UK city store in west London in 2022, having experimented with different formats such as planning studios, including one in central London that subsequently shut.
The first of its smaller inner-city stores opened in Paris in 2019, followed by Mumbai and Stockholm in 2022, in an effort to reach new customers as shopping habits changed.
Brodin said he wanted to open more small-format Ikea stores in other UK cities, including Brighton, where it bought a shopping centre in 2023. Beyond more store openings, Brodin said the priority was to make Ikea “more affordable and more sustainable”.
The new store, which will include a Swedish “deli” selling Ikea’s famous meatballs, was hailed by London Mayor Sadiq Khan as a “vote of confidence in London, in our economy and in our plans to rejuvenate Oxford Street”.
In February, he launched a consultation on pedestrianising Oxford Street, arguing it would help it compete with other global shopping locations. The thoroughfare was hit hard by the shift to online shopping and a lack of tourists during the pandemic.
In the UK, Ikea employs almost 12,000 staff, has 21 full-size stores, one order-and-collection site and three plan-and-order sites. The first store opened in 1987 in Warrington, north-west England.
