Ikea Model Violate Standard View Companies Compete Relation Vertical Horizontal Differenti Q34247145

How does the IKEA model violate the standard view on howcompanies should compete in relation to vertical and horizontaldifferentiation? Discuss product augmentation as part of yourresponse. Select one other case of your choice and discuss similarissues.

Expert Answer

To understand the IKEA model, we first should be clear that whatis product differentiation means, i.e. Vertical and HorizontalDifferentiation.

Horizontal differentiation is where the product quality andprice may not change but the product can be differentiated in termsof size, shape, colour or may be little bit of design.

Whereas Vertical Differentiation is where the product qualitychange is measurable and priced accordingly plus design is alsochanged