Retail furniture giant Ikea’s recent acquisition of handyman site TaskRabbit shows that it’s aware of competition from other online-only furniture retailers, and their push of services like installation and delivery, according to a report by Reuters.
Ikea bought the company in September 2017 as part of an effort to increase different services meant to help customers after they purchase “assemble-yourself” furniture. It’s the first acquisition of its kind by the company in the United States, which is the company’s second biggest market behind Germany.
The U.S. home furnishing market is worth about $282 billion, according to GlobalData Retail analyst Neil Saunders. Ikea’s share is 2 percent, down from 2.2 percent in 2014 and much lower than its share in Germany, at 12 percent.
The TaskRabbit acquisition has helped — tasks by the company have more than doubled and 10 percent of all tasks were furniture assemblies, an increase of 2 percent.
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Jesper Brodin, chief executive of Ingka Group, which owns most IKEA stores, said TaskRabbit was going to expand into areas like interior design and furniture repair, and that IKEA could mine TaskRabbit data for new furniture ideas.
“As this community grows, it’s not only about fixing one or two things but actually to add professionalism in interior decoration, into ‘life at home’ practicalities,” Brodin said. “TaskRabbit is a super interesting business case because it is scalable, not only geographically but also into services at home.”
The move comes as Ikea is facing increasing competition from online-only furniture sellers like Germany’s Home24, Wayfair in the U.S. and MADE in Britain. Walmart and Wayfair offer assembly services through a TaskRabbit competitor called Handy, which recently announced a partnership with Crate and Barrel.
“Anyone who sells furniture will have a delivery service,” Kantar Retail analyst Ray Gaul said. “The difference will be that instead of having just a delivery service, IKEA [is] trying to give some assistance in designing your space, and that’s where TaskRabbit can be helpful.”
Date: February 14, 2019