Friday, December 9, 2016

Here Comes the 'Ikea Effect'

Posted By on Fri, Dec 9, 2016 at 3:50 PM


Our up-yours pride for Ikea choosing Memphis over Nashville has waned, perhaps, as the prestige of the promise gives way to the reality — flocks of ferocious fans gridlocking the suburbs. But make no mistake, Ikea will change Memphis.

The Swedish home goods retailer opened its doors Wednesday. Ikea invited customers to camp in line by its front doors as early as 9 a.m. Monday, a full 48 hours before the official grand opening. The hardest-core fans were to be rewarded; couches and other gifts were promised to the first customers each day of Ikea’s first week.

But for some, life ain’t all Billy bookshelves and meatballs.

“I can’t wait for (Ikea) to open so I can go to Midtown Kroger,” wrote Memphis-based @thespacebase on Twitter recently.

Social media, though, has plenty of smiley-face emoji (the one with hearts over the eyes) for Ikea’s opening. Many note how empty their bank accounts will soon be and, even two year after the announcement of the Memphis Ikea, some still crow about how Nashville can “suck it” (or something like that).

But very soon, those sleekly designed Ikea products will, most likely, be in many Memphis homes. Jason Jackson, an architect at Memphis-based brg3s, said that can change people.

“Design can determine how we feel, and how we look,” Jackson said. “It plays a role in everything we do, whether we realize it or not, from the food we eat, to how we dress, even in how we get to work.”

He pointed to how Apple’s iPhone, a “beautiful tool” that was well designed, was able to to transcend the traditional flip phone and changed how we communicate. Ikea’s commitment to design is similar, Jackson said, and the company’s products are affordable to most, which can change they way they feel.

“You can have a nice end table or nice bed and you can feel like you’re living a life that maybe you thought was out reach,” Jackson said. “That can happen because the products have been more thought out and the production has made them accessible to more people.”

Ikea flitted about Memphis with interest but netting the retail behemoth required a $1.2 million tax break for the company, which posted profits of nearly $4 billion last year. But the store will employ 225 here, with a starting wage of $10.77 per hour and an average wage of $41,000. Also, over the next 11 years, the store is expected to yield $15.5 million in local taxes.

The investment will also make Memphis a regional shopping destination, and send positive signals to executives about the city’s health and growth potential, and create another attractive amenity for those considering a move to Memphis.

“High-end and destination [like Ikea]retailers moving into a city signifies a region is growing and has a bright future,” reads a blog post from JAXUSA, the economic development agency for Northeast Florida. “As these retail establishments enter the market, it signals to the rest of the world…that the city is a good investment for long-term business growth.”

But couples take heed. Assembling that well-designed furniture can test your relationship. Amy Poehler once joked that “Ikea” was Swedish for “argument.”

However, once you’ve assembled that Molger or Skarsta, you’ll be in love with it, maybe more than you should. A paper from consumer psychologists from Harvard, Tulane, and Duke noted that when consumer assemble their own stuff, they cherish it, something they called the “Ikea effect.”

“Even constructing a standardized bureau, an arduous, solitary task, can lead people to overvalue their (often poorly constructed) creations,” the paper reads.

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