When you enter Ikea’s freshly opened Oxford Street store in London, two things instantly meet your eye: a display of the company’s newest furniture line and some very bright colors.
The long-awaited store, which looked like a mega blue Frakta bag when in the works and was initially slated to open in 2023, finally welcomed shoppers on Thursday.
It’s not a common sight for an Ikea store to be smack in the middle of the city, and in a location that’s Europe’s most popular shopping destination, receiving a whopping 30 million yearly visitors.
But Ikea knows what it’s up against and has tweaked its city store format to account for its location. The store features new concepts, like a 25-square-meter live studio and colorful collections curated by Londoners. It also boasts a souvenir section by the entrance to attract fast-footed tourists.
The marketplace section, keeping affordability front and center, offers a range of kitchen items for £3 and under.
“We have been on to this for the last seven years, and we have [made] a lot of mistakes when designing city location stores,” Tolga Öncü, Ingka Group’s retail manager (COO) at Ikea Retail, told Fortune in an interview following the store opening. He gave the example of Ikea’s Paris store, where it did away with its serpentine format, thinking people would want to pop in and out without necessarily exploring all sections. But Parisians preferred the original format.
Formerly the Topshop flagship store, the new Ikea boasts a range of 3,500 products on display, with another 2,500 available for pickup. Given the busy neighborhood and tricky parking availability compared with some suburban locations, Ikea will limit the size and type of furniture people can collect or buy in Oxford Street.
“We have also learned over the last seven years which category of products people are more eager to bring home from the city location,” Öncü said, adding that small accessories are popular, while people are willing to wait a few days for sofas to ship to their homes.
Ikea may have had to make different choices for furniture at its Oxford Street store, but its 130-seater Swedish deli, featuring meatballs and hot dogs, will be present in all its glory. Öncü pointed out one design tweak key to this location—food will only be served in takeaway boxes to account for people working in the area who might want to grab a quick, low-cost meal.
London City problems
The company has other city-center stores in Stockholm and Mumbai. It’s also no stranger to London, having opened its Hammersmith store in West London in 2022 and a stand-alone restaurant next to it last year. This foray offered hints into what Londoners are looking for as the cost of living continues to stretch their wallets.
One of British retailers’ biggest concerns in recent years is the uptick in shoplifting, which costs them £2 billion a year, according to the British Retail Consortium. Ikea said that while it has stationed a security team across the store and made the checkouts clear to mitigate the risk of theft, it also wants to make sure it appears welcoming to shoppers.
The mostly underground Ikea store might struggle with queues as it has only a handful of tills two floors below street level. However, Ikea said it plans to introduce a scan-and-pay system whereby customers can skip the checkout counters by simply scanning to purchase an item.
In a bid to make the area more suitable for shopping, Ikea’s U.K. chief Peter Jelkeby has backed Mayor Sadiq Khan’s bid to pedestrianize Oxford Street. Khan has advocated for this to boost the strip following the crop of shops selling U.S. candy and the pandemic’s impact on general business in the area. The Westminster City Council has opposed Khan’s plan owing to disability access and public transport disruption.
Khan said Ikea’s big debut is “a huge vote of confidence in London, in our economy, and in our plans to rejuvenate Oxford Street and unlock its true potential.”
Öncü said the upside of a pedestrianized Oxford Street is that shoppers will be more at ease, especially if they accompany children.
“As a retail concept, the more relaxed our visitors are, the more time they will spend; the more time they spend, the more time we have to do business,” he said.
The Ikea store, which was led by Ingka Group’s investment arm, marks a new spurt of U.K. stores to follow in Brighton and Norwich.
This story was originally featured on Fortune.com
