Slovenia: small in size, big in retail

Slovenia is one of the smallest markets in Europe with only 2 million inhabitants (please, don’t laugh) and an active population (people aged 15 to 75 years) of 1,6 million. Nevertheless, its retail market is very competitive. Slovenia marks of the highest number of retail square meters per capita in Europe with 7 major retail chains (again, we’re being serious here) – five of them international (Spar/Interspar, E.Leclerc, Hofer (Aldi), Lidl and Eurospin) and two regional (Mercator, Tus).

According to TGI data research[1], 94% of Slovenian active population made their purchases in those chains, with Spar/Interspar, Mercator and Hofer (Aldi) leading with 57 – 60%.

The discount brand “big bang”

During recession (2008 – 2014), Slovenian retail noted two main changes:

(1) A significant drop in brand loyalty. While in 2008 people visited 2,7 different retail brands on average, the number rose to 3,1 in 2014.
(2) The rise of competitive “discount brands”. Retail chains such as Hofer (Aldi), Lidl and Eurospin successfully targeted price-sensitive buyers and marked an extreme growth: from 2008 to 2016 “discounters” realized 273% increase while “classic” retail chains only grew 10%.

These two changes brought about the today’s new fact: the discount brands are now “classic” and they set the standards and expectations of a “normal” retail brand.

The challenge

When examining the buyer structure and position on Rodgers population curve, it is evident that Hofer (Aldi) is better positioned among the so-called Innovators and Early Adopters, and Hofer (Aldi) and Lidl are better positioned among the Early Majority segment.

Building a good position among those segments is crucial for the future of the brand, both in terms of brand loyalty and revenue. To ensure a bigger brand interest among Innovators, Early Adopters and Early Majority, Spar needed a truly fresh idea.

The audience insight

Innovators and Early Adopters was set as the main target groups, further studying their perception and lifestyle. These studies revealed that Spar’s ideal target audience consists mainly of younger urban adults who keep highly skeptical (if not altogether negative) attitudes towards big companies and advertising. Slovenian young do not listen (or even trust) brands who rely solely on brand stories, they expect brands to do something for them, to engage in solving concrete real-life problems, to really make the public a part of the brand.

The challenge was obvious: a traditional image campaign simply wouldn’t cut it.

But the in-depth analyses also revealed that young Slovenian adults highly praise socially responsible behaviors and actions, which can in part be attributed to growing up during recession and an increasingly uncertain job market. In 2015 more than 3-times as many young people moved abroad than in 2010[2] to find a job, to find career opportunities, quoting that “you can only succeed by being selfish and having the right connections” and that “nothing can be done in Slovenia.”

The strategy
Based on the insight, the agency started with a simple question: What if we prove otherwise? If the prevailing attitude was that Slovenia is not a place for modern, progressive ideas and business practices that put people first, Spar should create one. If people wish for a better, more stimulating and responsible environment, Spar should not only share the sentiment, but prove it though concrete actions. To put it bluntly, Spar should not just “talk the talk”, but also “walk the walk”.

The idea

Like no Slovenian (or for that matter, regional) retailer before, Spar would co-create small local businesses and call out to an entire country to join forces in supporting them by buying the products. By doing that, a long-lasting national initiative would be sparked, motivating people to dare make their own (business) opportunities and rely on the support of local environment.

To spread this bold message to as many people as possible, the agency turned to Pro Plus, Slovenian leading media house, and proposed they create a totally unique TV format that would capture both the story and the spirit of the initiative.

With Pro Plus agreeing to the challenge, an innovative three-way partnership was formed.

The name and the game

Thus, “START IT UP SLOVENIA” was created and started with first season in September 2016. An initiative with a mission of inspiring people to rethink entrepreneurship by demonstrating a simple promise: “Each of us can do a lot, but together, we can do anything.”

Each partner would first do their part. Spar would introduce a special shelf in their megamarkets across the country, promoting products made by local, largely unknown entrepreneurs, Pro Plus would create a custom-made entrepreneurial TV show format based around that, and Formitas BBDO would manage the communications and creative for all involved.

In order to demonstrate that innovative business opportunities can and do already happen in Slovenia, the partners hand-picked in three seasons (for now; two finished, third one on air) 28 local entrepreneurs with interesting products ranging from different bio-eco-natural food products and hand-sewn children’s toys, to natural cosmetics for people and also for pets.

What’s more important, the entrepreneurs had interesting background stories that kick-started their respective business journeys. Honest, real stories that anybody could relate to. These were documented in a custom-made TV format which intertwined human interest, reality TV, entrepreneurial education, and comic relief. The main premise was simple: the public could join Spar in “walking the walk” and support local entrepreneurs by purchasing their products and thus enable at least one of them to earn the title of “Hit Product of the year” and continue their business story with the major retailer.

The implementation

Special “START IT UP SLOVENIA” shelves were introduced to Spar’s megamarkets across Slovenia, displaying both products and their creators’ short introduction, along with a clear call to action.

[1] Source: TGI research 2010 – 2016; valid for all data in this chapter

[2] Source: Statistical Office of the Republic of Slovenia