BUSINESS

IKEA Korea faces teething problems

By Korea Herald
  • Published : Nov 17, 2014 - 21:24
  • Updated : Nov 17, 2014 - 22:32

Swedish furniture and appliance retailer IKEA, which will open its first outlet here next month, is facing criticism for using the name “Sea of Japan” on its products and website to name the waters between South Korea and Japan. 

The company was also rebuked for charging more for products in Korea than overseas. Consumers had expected IKEA to stay true to its promise to provide high-quality goods at affordable prices.

The controversies arose after IKEA Korea officially opened its official website last week to unveil some 8,600 items that will be sold online and at its first Korean store in Gwangmyeong, south of Seoul, to be opened in December.

In it, IKEA used a world map with “Sea of Japan” marked in a file introducing its global network. 
IKEA’s first Korean outlet slated to open next month in Gwangmyeong, Gyeonggi Province. (IKEA Korea)

The appellation for the body of waters, called the “East Sea” by Koreans and the “Sea of Japan” by the Japanese, has long been a source of tension between the two countries who have often collided over history and territorial issues.

A world map that the retail giant is currently selling in stores in Japan, U.S. and U.K. as an interior decoration item also uses the Japanese name.

“Please sell the map in Japan, not in Korea,” an angry consumer wrote on IKEA’s official Facebook page.

Another said that he could not understand “Why IKEA did not do research about Korea and its public sentiment before entering the country.”

In response, IKEA Korea said that it was discussing the matter with its headquarters and would soon clarify its position.

Regarding the price gap with items sold at IKEA stores elsewhere, young Korean consumers who said the most attractive aspect of IKEA is its affordability said they were angered and frustrated to see that some goods were priced higher than stores in other countries.

For instance, IKEA marked 449,000 won ($410) for its Besta Burs TV unit which is sold at much cheaper prices in Japan, Germany and the United Kingdom. The U.S. consumers pay only $249 for the same product.

In March, Ulf Smedburg, country marketing manager of IKEA Korea, said that the company would stick with its global strategy that “the price of products should be affordable for everyone.” But he did not elaborate on whether the prices would match those in the U.S. or Europe.

It also announced its plan to open five stores in Korea by 2020 with an aim to be “very conveniently accessible for the majority of people in Korea.”

The Swedish firm was operating a total of 345 stores in 42 countries as of the end of 2013.

By Park Han-na (hnpark@heraldcorp.com)


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