How many brilliant ideas can you get thinking about a hot dog? Quite a lot, as it turns out. In the mid-1990s, IKEA realized that the hot dog was a great symbol for good quality at a low price. That may be a lot to expect from a humble sausage, but it became an important piece of the puzzle in thinking freely and innovatively when it came to product development. But let’s start at the beginning, when a hot dog was just a simple hot dog.
The Birth of the IKEA Hot Dog
In the late 1980s, IKEA started selling hot dogs at a few of its stores in Sweden. The first one was in the southern city of Jönköping, and after a shaky start, all stores in Sweden eventually had a hot dog area after the checkout. Ingvar Kamprad, the founder of IKEA, insisted that an IKEA hot dog should cost far less than one you would buy in the city. People should be amazed at how affordable it was and how delicious. And it couldn’t be just any old sausage; this had to be a frankfurter-quality sausage!
A Super Rational Hot Dog
The idea of having a far lower price for a product that everyone knew the price of was crucial, and while the hot dog offer was being developed, the hot dog itself came to symbolize the whole idea. Imagine if the price could also be reduced for products that customers are just as familiar with as they are with a hot dog. “They should cost no more than the loose change in people’s pockets,” was Ingvar’s stance. They should be products like consumables, which people buy often and know the price of. IKEA should put all their energy into these ‘hot dogs’ and really achieve almost impossibly low prices.
The Hot Dog Mentality
To communicate his hot dog metaphor, Ingvar wrote a handwritten letter to the people he thought ought to be able to do something about the situation. He wanted them to look at what competitors were charging for coffee mugs, washing-up stands, and plant pots. This is where IKEA could really make a difference – making frankfurter quality at a great low price. As it turned out, the hot dog as a symbol of innovative thinking around product development worked rather well, and all kinds of products were developed. Still today, one can hear product developers speaking “hot dog” when discussing their range.
The Lasting Impact of the Hot Dog
The hot dog remained a firm favorite with Ingvar. So much so, that when he was made a Knight of the 12th Order of the Seraphim, the hot dog made an unexpected appearance in his acceptance speech: “I would just like to add that a good frankfurter in a bun costs just five kronor (EUR 0.5) at IKEA.”
The hot dog mentality has become a symbol of IKEA’s innovative thinking, rooted in the idea of delivering high-quality products at low prices. This simple yet powerful concept has allowed IKEA to continuously develop new products and maintain its position as a global leader in the retail industry.
