How Ikea started selling inside Best Buy

In what the companies are calling a “first-of-its-kind” collaboration, Ikea US is opening shop-in-shops within select Best Buy locations.

At 10 stores throughout Florida and Texas, Ikea will set up 1,000-square-foot shop-in-shops, showcasing kitchen and laundry room furnishings. Ikea associates will be available to help customers plan and order their items, while Best Buy “blue shirts” will be nearby to provide assistance with the purchase of electronics that fit into their new kitchen or storage area.

The partnership marks the first time Ikea products and services will be available in another US retailer, in this case a fellow big-box store and category killer. It’s also the first time Best Buy has partnered in this capacity with another major retailer, as opposed to one of its vendors or brands.

So what made the two titans reach across the aisle? According to executives from both companies, it was a combination of shared values and a clear value proposition for customers, which led to a speedy implementation.

On the same page: Rob Olson, chief operating officer at Ikea US, told Retail Brew that the companies broached the idea at a Retail Industry Leaders Association conference just over a year ago, and then more in-depth conversations followed in January.

“We were actually at a retail conference together and started talking about our customer base and realizing we had such a similar customer base that we were working with,” he said, adding that electronics and home furnishings “marry together.”

Why these two companies in particular were able to work together so seamlessly has a lot to do with their products, and how one was able to complement the other. While Best Buy has long sold individual pieces of furniture, it historically didn’t offer customers the opportunity to plan and order an entire living space, Luke Motschenbacher, president of retail at Best Buy, said, adding that it also allowed Best Buy to expand into other categories of furniture such as countertops and cupboards.

For Ikea, the upside of the partnership is simply to expand into new markets and increase access and convenience for its customers. Partnering with Best Buy was the “perfect opportunity for us to really densify and be closer to the customer,” Olson said.

Fast friends: Motschenbacher said the speed at which the partnership developed was an “anamoly.” Usually, the company partners with vendors that are already embedded in Best Buy’s business, and even then it could take years before something comes together.

He also chalks it up to the two companies taking a similar approach to improving the customer experience.

“When you have some shared culture, shared belief, shared vision for customers, these things can happen very quickly,” he said.

He added that after touring their respective facilities and doing a couple of market visits together, they quickly went into planning mode.

But how is the collaboration working on the ground? The trick is making the movement between Ikea and Best Buy associates as seamless as possible, depending on the customers’ needs.

“There’s a handoff that has to occur from the Best Buy associate to the Ikea associate, and the reverse is also true,” Motschenbacher said.

For instance, a customer could schedule a consultation with an Ikea associate to discuss a kitchen design, but then when they want to get more information on a specific Samsung appliance, that is when the handoff to a blue shirt would occur.

Motschenbacher said Best Buy is well acquainted with that kind of cross-employee work. “Broadly, if you look at the types of labor programs that exist inside of the Best Buy store, that is not something unique from this relationship,” he said. “We are very accustomed to working with many different vendor representatives inside of our stores.”