Inside IKEA’s ‘Price Lowered’ strategy: How it’s taking on rising costs

In the face of rising living costs and economic shifts across the GCC, IKEA is demonstrating unwavering confidence in the region’s potential by launching its bold and forward-thinking “Price Lowered” initiative. This permanent price reduction strategy is more than just a response to inflation, it is a signal of IKEA’s dedication to delivering lasting value, accessibility, and quality to the many people who call the UAE home.

By strategically lowering prices on hundreds of its most popular products and key services, IKEA is setting a new benchmark for affordability without compromising the superior design, durability, and sustainability that define its brand. This initiative exemplifies IKEA’s mission to enhance everyday living through thoughtful innovation and customer-centric solutions.

According to Vinod Jayan, managing director for IKEA in the UAE, Qatar, Egypt, and Oman, “Our ‘Price Lowered’ initiative is a reflection of IKEA’s long-term vision for the region, empowering customers with well-designed, functional, and affordable home furnishings that enrich their lives today and into the future.”

Unlike temporary discounts or seasonal campaigns, IKEA’s “Price Lowered” is a deliberate, permanent shift in pricing policy. Each year, the retailer identifies hundreds of its most in-demand items and strategically reduces their prices permanently, from PAX wardrobes and KNIXHULT lighting to kitchen essentials and living room furniture.

“We’re not chasing short-term sales volume,” Jayan explained. “We’re building long-term customer trust. This isn’t about clearance, it’s about access and affordability.”

Beyond product markdowns, the initiative also extends to services, such as delivery, return, and assembly, which have traditionally represented added costs in the customer journey.

This holistic approach, addressing both product pricing and service affordability, reflects IKEA’s evolving role as not just a furniture store, but a full-spectrum home solutions provider.

Value-driven services: Everyday savings that matter

For customers navigating budget constraints, reductions in essential services make a big impact. IKEA has significantly lowered prices across multiple service touch points:

• Assembly fees have dropped from Dhs150 to Dhs99
• Home delivery has been reduced from Dhs75 to Dhs45
  (Free for purchases over Dhs950)
• Parcel delivery is now Dhs10, down from Dhs 19
  (Free for orders over Dhs250)

“These changes address a key barrier to purchase, the hidden costs after checkout,” said Jayan. “By making it easier and more affordable to bring IKEA into your home, we’re enhancing not just the shopping experience, but the whole ownership journey.”

These service savings are especially relevant for UAE customers purchasing larger items, or furnishing multiple rooms, a common scenario in the country’s growing housing market.

One of the most impressive aspects of the initiative is how IKEA manages to maintain, and often improve, product quality while reducing prices.

This is possible thanks to its renowned “democratic design” philosophy, where affordability is integrated into the design process alongside function, quality, form, and sustainability.

By leveraging its vast global sourcing network, optimising manufacturing and packaging processes, and refining logistics operations, IKEA creates cost efficiencies at scale, which are passed on directly to customers.

“All products in the initiative undergo rigorous testing and must meet IKEA’s international quality benchmarks,” Jayan said. “And many are backed by guarantees of up to 25 years, so customers know they’re still getting quality, not just a lower price.”

Categories covered by these warranties include mattresses, kitchen mixer taps, cookware, knives, PAX wardrobes, and full modular kitchens.

Risk or reinforcement? Navigating perceptions of lower prices

In retail, price cuts can sometimes raise concerns about quality. But IKEA is addressing this potential challenge head-on through transparency and education.

Clear signage in-store and online communicates the permanent nature of the initiative. Product guarantees and customer testimonials further reinforce that “Price Lowered” does not mean “quality compromised.”

“Our customers value transparency,” Jayan explained. “We’re not cutting corners. We’re improving processes, and that’s a very different story.”

Building loyalty through flexibility: The 120-day return policy

Trust is also being built through a redesigned returns experience, particularly for IKEA Family members, who now enjoy an extended 120-day return window, one of the most generous in the region.

The idea is simple: reduce post-purchase stress and encourage confident decision-making. Customers can now try products in their homes with more time to decide if they’re the right fit.

“It’s about reducing friction and giving people time to live with their choices,” said Jayan. “This level of flexibility shows that we’re not just selling, we’re supporting.”

This extended return policy complements a suite of other IKEA Family benefits, including early access to promotions, exclusive offers, and personalised product recommendations, all of which are designed to increase engagement and deepen loyalty in a highly competitive market.

Affordability meets sustainability: A shared agenda

At a time when sustainability and affordability are often positioned as opposing forces, IKEA is proving that they can be mutually reinforcing.

“We believe in sustainable affordability,” Jayan said. “We don’t just want to offer lower prices, we want to offer better value over time.”

Many “Price Lowered” items are made from recycled or renewable materials, including responsibly sourced wood, recycled polyester, and water-efficient technologies. Products such as LED bulbs and energy-efficient appliances help customers reduce both environmental impact and utility bills, generating long-term savings.

IKEA stores in the UAE are also shifting toward 100 per cent renewable electricity, contributing to a smaller carbon footprint and a more resilient cost structure for the business.

Product guarantees: Confidence built into the price

A key part of customer reassurance is the breadth of IKEA’s product guarantees, which remain unchanged, or even enhanced, under the “Price Lowered” banner.

Whether it’s a 25-year warranty on modular kitchens or a 10-year guarantee on some sofas and cookware, the message is consistent: affordability does not come at the expense of durability.

“This gives customers confidence to invest in our solutions,” said Jayan. “They know we’ll stand by them for years to come.”

To make it easier for customers to benefit from the initiative, IKEA has taken several steps to increase visibility of reduced-price products:

• Items are clearly marked in-store and online
• A dedicated “Price Lowered” section is available on the IKEA UAE website
• Filters and tags help users quickly identify qualifying products

This omnichannel clarity ensures that both casual browsers and mission-driven shoppers can quickly find value without compromise.

Far from a static campaign, “Price Lowered” is designed to evolve.

Each year, IKEA reviews and expands the initiative based on customer feedback, operational performance, and market dynamics. The long-term target is to add hundreds of additional products to the program annually.

“We continuously monitor sourcing, logistics, and customer behaviour to keep the initiative competitive,” Jayan said. “It’s a living strategy.”

All products in the “Price Lowered” initiative are available across all IKEA stores in the UAE,  as well as online, ensuring accessibility for customers regardless of location or channel preference.

This nationwide availability underscores the company’s belief that value should be consistent, not conditional.

Strategic differentiation in a crowded market

In the crowded and competitive UAE retail landscape, IKEA’s “Price Lowered” initiative stands out not just for its pricing, but for the depth and breadth of its value proposition.

While many brands offer promotional pricing as a reactive measure, IKEA is implementing a proactive, structural change to its business model, one that touches product, service, supply chain, customer care, and sustainability.

“In today’s market, value is more than a number,” Jayan concluded. “It’s about consistency, trust, and experience. That’s what ‘Price Lowered’ represents, not just better prices, but a better way to shop.”