Swedish furniture retailer Ikea is expanding its home improvement services and smaller-store formats in China, as the maturing property market shifts consumer demand from furnishing newly purchased homes to upgrading existing living spaces.
Chinese consumers are increasingly seeking affordable, flexible ways to improve their homes rather than undertaking costly renovations or replacing furniture on a large scale, according to Aleksey Efremov, senior vice-president of Ikea China.
"China's housing market is becoming more mature," he said in an interview during the ninth China International Import Expo in Shanghai. "The market is moving from a fast expansion phase to a more stable, mature phase, where people are focused not only on changing homes, but also on improving the quality of their lives."
The shift is prompting Ikea to place greater emphasis on modular furniture, room planning and what it calls "light customization" services, allowing customers to upgrade individual spaces such as kitchens without renovating an entire property.
Efremov said consumers are increasingly considering how their homes can adapt to different stages of life, from starting a family to accommodating changing needs as they grow older. This has created opportunities for retailers to offer products alongside design, planning and installation services.
Ikea has seen a positive response to its light customization offerings, particularly for kitchens, where customers can improve specific functions while keeping renovation costs manageable, he said.
Cost transparency is another important factor. By providing clearer estimates for products and services, Ikea aims to make smaller renovation projects more affordable and easier to complete.
The approach reflects a change in the company's commercial priorities.
Previously, "the focus was often on individual products, such as a particular piece of furniture or a storage solution", Efremov said. "We are now putting greater emphasis on supporting customers throughout different stages of life with a combination of products and services."
Delivering those services requires additional investment in staff training and digital capabilities.
Ikea has introduced artificial intelligence-powered planning tools that help employees design home furnishing solutions more efficiently and allow customers to visualize proposed layouts before making purchasing decisions.
The company has also invested in digital quotation and project management systems to streamline the process from initial measurements and design to delivery and installation.
The shift toward services is being accompanied by changes to Ikea's physical retail network in China, where the company is experimenting with smaller stores to reach consumers closer to their homes.
Efremov said smaller formats in Beijing and Shenzhen, Guangdong province, are attracting customers not only for everyday purchases, but also for consultations on furnishing individual rooms or entire apartments. Digital planning tools allow customers to begin designing a home without visiting one of Ikea's traditional large-format stores.
The smaller formats typically measure between 1,000 and 2,000 square meters and stock about 2,000 products for immediate purchase, compared with Ikea's overall range of approximately 9,000 to 10,000 items.
The company is reviewing product assortments based on shopping behavior and sales performance rather than applying a uniform selection across all smaller locations.
