Kiyota.
I'm Chelsea Daniels and this is the Front Page, a daily podcast presented by the New Zealand Herald. Kiwis will finally get to experience the labyrinth that is an Ikea store from December fourth. The new Sylvia Park site in Auckland is one of the company's largest in the Southern Hemisphere, about the size of three rugby fields. There'll be thousands of products available online and in store, and yes, they will be serving up their famous Swedish meatballs in a
four hundred and twenty six seat cafeteria. So why do we get so excited about international brands setting up on our shores and is there enough appetite for Ikea and their meatballs to succeed where others? Today? On the front Page, Quantum Jump CEO and marketing expert Ben Gooddow is with us to explain the hype around one of the world's leading retailers. First off, Ben, what is the significance of Ikea finally coming to New Zealand.
I mean, I think there's a number of factors here. It is a major, major retail brand globally and one of Sweden's grade ex sports. I think to a certain extent, the sheer fact that so many Kiwis already have Ica products in their homes which they've may be brought back from overseas or people are given to them, or they've ordered in. And so it's a brand that almost feels like it's been here for a while anyway, but a
bit actually planting itself. And it's very grounding for an international brand like that to arrive in New Zealand, not unlike a couple of years ago. I think we go, wow, you know, we're we're finally there as a nation. We've got an IQ, We've a Costco, We've got Nature and m Sephora, Victoria's Secret out of the airport. You know, brands which are you know, living in a country and far flung in the furthest away part of the world.
In fact, I read today that we are the Ikea store in Auckland will be the servist away from Sweden store that they have. You know, it can be something when when these brands turn up and they've got to.
Us in terms of Ikere, what makes it like I suppose the international juggernaut that it is.
Firstly, I mean, the product is amazing, you know, it's there. They're innovative, they're they're they're sustainable or as sustainable as you can be within it with any category like that, and they're pushing to be more sustainable forever. They their focus on design is is fundamental to their success, you know.
Be I mean I remember as a as as as you know, probably not long after I left store, going to be opening of a first Ikea in London and queuing up that day to get in and I didn't even really know what Ikea was, something to do on a on a Sunday, but but being bowled over by by the design, you know, the that simple Swedish aesthetic and you know it really it's not just furniture. Albeit I also have cursed and I once foolishly brought a
foot on from my Ikea. And I'm sure if any anyone watching this imagines, you know, flat pack assembling a futon in a time where I did not own a power drill, so I had to hand hands through it. Every last through it was. I have the I have blisters, and I was not a happy person. But but the bouton was sensational.
It's that's part of the fun of it, isn't it the flat pack. I mean I say fun in quotation marks because I personally don't think it's fun. But in terms of I mean you mentioned London in that.
What when?
What would that have been?
That was nineteen eighty eight.
Yeah, it was it the same kind of huge sensation it was even then than it is now because in the eighties you didn't have social media or the Internet and things like that.
Yeah, it's funny. I was reflecting on that the other day, I mean especially asked for it's almost I don't know I remember it. I don't know why I was there. I don't know how I knew it was going on. Maybe there was an advert in the Evening Standard. It wasn't far from my flat, but it felt big. I remember going to work the net's day and wherever, you know, people were talking about it, and so I guess it was. It must have been on the news. It must have
been on the radio. Maybe there was a piece of it in the Standard in the morning where people are getting on the tube with their newspaper. But you're right, I mean the I think it's fun. Only now, having lived now with social media for ten fifteen years, we almost forgotten. How did these things get shared and amplified and so on. Before all that happened, but I guess we just found other ways. I mean apartment of meals. People talk to each other about it.
Do you think Ikea will have to adapt to the Kiwi market or is Ikea just Ikea?
Well? I think initially, I mean they are just Ikea their product range. They're not going to develop products just for this market. And are you know, not quite sure what products we were uniquely we would uniquely need. I mean, we're a lot different for the rest of the world. However, they have done a lot of groundwork, which they've talked about some of their media relations around going into Keiwi homes and understanding what how key we use products, what
they need. I think probably understanding things like how key we use their garages, you know, as well as their outdoors and so on. So I think probably it will be more they'll show up with the ranging because they they'll have a vast array of ranges, but not everything will be as appropriate in autund as it might be in Tokyo or New York or whatever. So I think, yeah, we'll get a profile which will be developed deemed appropriate based on those insights.
What do you make of the main freight partnership? Is that something quite unique for those who don't know they're going to be doing this main freight to home service and the offer will take heavier items into people's homes if that was their preferred option. That's quite revolutionary because I always fret when I buy something or a piece of furniture thinking am I going to fit it into my car? Or am I going to be able to
carry this up my drive? So that's quite a unique having a main freight you know, a couple of them actually lug it into your house is quite special.
Yeah, well, they are operating distribution in some other markets, especially where they don't have those those stores. I mean, it's certainly a very smart, strong play for this market. You know, the suddenly you know they've only got one store, but it's almost like have they got twenty nine stores? And we're also living in an evolved age of e commerce.
People's happiness buying online ever since Covid was a bit of a game changer for online buying in New Zealand, which is has always been a little bit behind the rest of the Western world in terms of uptake on e commerce. But it kind of makes sense for Ikea, especially once people have some familiarity with products. You know, if you're if you're living down country and your your friend is that it shows you shows you their foot on which they're really delighted with, and you go, well,
I'll have one of those, you know. You you can just order one and you can pick it up from your main freight delivery, so it's aluld have it delivered into the house. So I think it's going to allow their distribution to be really powerful, and for other brands that are in that that, especially about heavier furniture offering, it's going to put some pressure on it.
Your opening is also going to allow many New Zealanders for once again experience the loved Swedish meatballs that they
remember from visiting Ikea stores overseas. I think all of us who have lived overseas, and I did so for some time, are very familiar where you put an itinerary together for your key, we friends and family coming to visit you, and they say that's very lovely, but can we go to ikeamost and whether it's in Chicago or London where I was for some time, they say that looks great, But let's get to the Ikea quickly, please.
The only reason I can think of for Ikea that that mat would perhaps not make it work so well here is that because there's been an absence in the market of ike for so long. The likes of Kmart and the warehouse have their own flat pack furniture, obviously not to the scale of as Ikea, but people have gotten you know, cupboards and bookshelves and desks and things
like that already. Do you think that ike as products will hit as hard as it would have without those competitives, or do you think Kmart and the warehouse and the like should just give up now?
Oh? No, I mean I think it's always I mean, first of all, I mean, the people like to have choice, and you're going to have loyal shoppers that km loyal shoppers at the warehouse. Ike is going to come in and it won't be for everyone, and I think in a way probably, I mean, it'll be interesting in both retailers have been doing research on what might happen once I care in market and how does it maybe reshape
their ranging. You know, they may go down a price pointing strategy, or you know, if there's resistance flat pack do do they have less? You know, maybe not quite so flat pack not more ready to go. And also, I mean fundamentally is for business they're in. I mean I think provided they can they can see an appropriate ROI they'll you know that they'll stick at it, but
they probably need to. It may make them think about the ranging and what you know, because they may find they get really disrupted in some areas but maybe less so in others.
Can you show some examples of perhaps international brands that we've gotten quite excited about and that have actually thrived in New Zealand. Of course I'm thinking initially straight off the back. Costco, for example, that was huge when I came. I went to Costco on the second weekend that it was open, and I regret it. It was terrifying.
Yeah. Well, actually I went the opening day. You can tell I'm a bit of an opening day junkie, and I went round and it was, Yes, it was quite quite the thing. I mean, the cues for crowds, that's the trap for traffic was I deliberately part of the little way away and I walked in. I decided I
didn't want to get stuck in the car park. I think part of the big thing was with the sheer bars, the smiles on people's faces, the cues for the for the one dollar hot dogs, and and I think just the you know, Costo, like I hear, it's a scale thing. You know, it's big and you know very much. You know, a retail a retail cathedral, and so yeah, that babe, I mean certainly in Costco is just hasn't got quieter.
You know, like the the ques, especially at weekends are are quite incredible, although they do pretty well at pumping people through, but yeah, anytime you want to go over, you're going to see it's going to be pretty busy. And the cue for their their hot roast chickens and things is never seems to diminish. They just get wiped out. So I mean, yeah, they've done well. I mean some others have found a little bit harder. I think, you know,
Sephora has found a little bit harder. Obviously. You know, the top Shop brand came into New Zealand, although it wasn't it wasn't directly owned by top Shop itself, so it was through a local partnership, so it didn't have the same financial dynamics that it would be a fit have been the actual brand owner coming in in terms of margin. So I think they found a bit tougher because they opened up at a magnificent site on Queen Street and it was a really lovely store, and foot
traffic to it looked pretty good. But I think just getting those most margin aspects of your overhease too high, it's just very hard in retail. And you know, we've had other brands here, I mean, you know, Laura Ashley body Shop and so on. It's still kind of come and gone, but they they've also been having challenges. You know, some retail brands go through challenges globally anyway, just as trends change. I mean, the retail chain it's not quite
on the same level as I here. But the ones who are really killing it over here of time in his chemist Warehouse, and you know, they they've really tapped into something that you know, we didn't really have that large scale, low cost chemist pharmacy offering and all those brands before. And you know they, I mean I just saw yesterdays a new one going up to Stabba Road and go wow. They I mean, they're they're they're just going gamebusters.
Yeah, They're popping up everywhere, aren't they. I mean, if you could waive a magic wand and have an overseas retailer come here tomorrow, or really look at New Zealand as a really good option, what would it be. I know what my couple are, so I've been advocating for Audi to come here for a long time. They've just grown roots in Australia. And then another one that I was thinking of the other day, would would we would we like a Walmart or something here?
Well, in a way, the warehouses a Walmart, so I think, I mean, who knows, maybe of Walmart could buy the warehouse and then that would that that would be interesting the an Audi, Yeah, I mean the the I mean obviously, yeah, it's maybe strange to a whole other podcast conversation would be, you know, the whole supermarket thing and the you know and but but you know, oldie, you know to come in. It's it's just with such a you know. One of your other questions before is you know, we are a
very small market for which is why I here. Of taking their time to come here. They have been richer solutions before that, all richer market options to go into. So it's when people do come here, it's because they've worked out or they think they've worked out how to make money. I mean brands. For me selfishly, it's I'm quite passionate about some overseas apparel brands. So there's one particular favorite of mine is an Italian brand ORed Boggy, and it's it's a it's a web brands, so you know,
basically you can buy it online. They they they they ship out of Australia, but if you actually want to go to a store, you usually have to be in Italy. But the chances of from companies in a rather slim. But then you know, maybe moving back and be said for some of some other things in the old days, I would have said I would have loved to have had a Virgin Megastore here because that was a place I spent an awful lot of time in the in
the eighties and nineties. But as you know, music and entertainment.
Shopping is when we used to have records and CDs.
Records and CDs and Virgin Megastore was like the ultimate place. Mad and Tower Records of the ultimate places, but they don't really exist in the same way now, so it's not quite the same call.
What would convince someone like another one over in Adelaide's just got a couple of t K Max's and a unique cloth. And then there's another another Japanese brand that we were talking about before. I think it's Moojie. What would make you know one of those brands actually look at New Zealand, what do we have to do well?
It may partly be seeing some of these other international operators succeeding. So I mean Costo, I don't know whether Ike have been IQ have been coming for years, and I don't know whether Costo actually getting in and breaking ground and buildings helped ive Ike similar confidence to come into market. It's probably, I mean for them, it's probably seeing what is the economic situation, what what is working or thriving in New Zealand and and identifying market gaps.
You know what isn't being said? I think that's what you know. Come back to Chemist Warehouse. Why they've done well is there was nothing like it in market, and you know, the the established retailers of day to day pharmacy goods were we're doing in a in a much more traditional way. So they've come in discounted, but also the arranging is very very different, you know. I mean another brand that would be really interesting over here is Primark,
which is you know again, fast fashion, super cheap. You know, it's you can you can get kitched out for so little and they and they their stores are massive over in particular the UK and multi floor pretty much pick up whatever you want. I would have thought the prime Ark would kill over here. Actually it would if they come back to your point, why would they come here? They would just had to establish but there was a market gap that wasn't being served well by the existing insisting players.
Thanks for joining us, Ben.
You're welcome. It's been a pleasure.
That's it for this episode of the Front Page. You can read more about today's stories and extensive news coverage at nsidherld dot co dot enz. The Front Page is produced by Jane Ye and Richard Martin, who was also our editor. I'm Chelsea Daniels. Subscribe to the Front Page on iHeartRadio or wherever you get your podcasts, and tune in on Monday for another look behind the headlines.