Ikea Canada invests $50 million in lower prices to increase affordability

The price cutting continues at Ikea. The Canadian division of the Ingka Group, which is the franchisor that owns the majority of Ikea locations, has announced that its investing more than $50 million in lowering the price on 550 products.

• This comes on the heels of Ikea Canada’s $80 million investment in 2024 to bring down prices on more than 1,500 products across its catalog.
• It also parallels the Ikea parent company’s “New Lower Price” initiative, which launched in 2023 and lowered the price on 600 popular items up to 20%.

"As Canadians continue to be extra cautious about their spending, we remain committed to supporting them with incredible value for money across our range,” Selwyn Crittendon, CEO and chief sustainability officer at Ikea Canada, said in a statement.

Playing the long game: While Ikea’s focus on price-cutting goes back to at least 2023, a majority of retailers anticipate value to remain a vital concern for shoppers in the year ahead. A new survey from Deloitte found that 6 in 10 retail executives expect consumers to prioritize price over loyalty in 2025, while 8 in 10 expect price wars to intensify.

But appealing to consumers on price can come at a cost. In its 2024 annual report, the Ingka group noted that its “focus [on] restoring affordability by lowering prices” has come “at the planned expense of lower top-line sales and a lower bottom-line result.”

• Annual revenue declined more than 5% in fiscal year 2024, per the report.

The upside is that store visits increased 3.3% and online visitors jumped 28%, and as the company pointed out in the report, “at Ingka, we think in decades, not quarters.”