Lidl: The underdog story

Lidl-kuva

It is not a secret that Finnish retail market is an oligopoly with two big players – S Group and Kesko. Together these Finnish companies have an impressive 80 % market share. What is news is that now there is a real contender in the game – Lidl! In this blog post we concentrate on a couple of factors how Lidl is challenging the Finnish giants in their home market.

Lidl is the biggest discount supermarket chain in Europe with over 10 000 stores in 25 countries. But when they started to conquer Finland in 2002 they had difficulties. Many people didn’t change their consumer behaviour even if Lidl had the lowest prices. After heavy marketing efforts and small strategy changes, the situation changed and they are now an accepted alternative. Lidl is growing rapidly even if they still are an underdog. They have now reached their goal, profitable growth with best economical results in the business.

Hans

hansvalimaki.com

Who would have believed that Lidl would take over the opinion leadership in the market? This is where Hans comes to picture! Mocked for his insufficient social skills and short temper, but also a founder of one of Finland’s most respected restaurants, Hans Välimäki came to be the key person in Lidl’s marketing strategy.

And Hans and Lidl marketing is everywhere! For one example there is an all out Lidl production TV show Hans Grill Party where he cooks Lidl products with friends. The clever thing is that the TV audience doesn’t even recognize the whole program is a paid TV commercial!

It is hard to believe that a world class top chef would buy vacuum packed meat that Lidl sells unless he received a substantial pile of cash as a reward. Lidl, on the other hand, is not only receiving a huge boost to their brand value with this deal but also gaining remarkable market share increase.

What Lidl is succeeding now in is not just business but more – a penetration to Finland’s introverted market. Consumer behaviour is changing and the ideal of preferring domestic enterprises leads to prosperity is now fading. Or is it? Is Hans just so good business that he causes this anomaly?

 

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3 Responses to Lidl: The underdog story

  1. m&s says:

    Good point of view! Is Hans Välimäki really the attraction of Lidl or is it the mentality of Finns which has changed? A wild guess gives the answer that Finns has recognized the added value of a discount supermarket. Also Lidl itself has made changes towards a more customer friendly environment for Finns, by for example expanding their range of products, by accepting cards as a mean of payment etc. Both parts, the customers and the supermarket, are gaining from the new relationship! It will for certain be interesting to follow the development of Lidl’s concept – will it keep its “low price profile” or will it raise the prices when gaining more customers…

  2. marijohannal2014 says:

    Money talks! It’s so true that the most TV-watchers didn’t even notice that “Hans grillaa” –episodes were just the series of Lidl –commercials. Very clever idea to promote Lidl!

    Also the other Lidl commercials on TV are different to other grocer’s of Finland; Lidl has launched the humor aspect to commercials, in which they make fun of the Finnish prejudice against German enterprise & also the origin of products.

    For me the reason to shop in Lidl is not Hans; more important reason for me are cheaper prices of fair trade products and organic products.

  3. JV says:

    Lindl has been successful in acquiring customers in a relatively moderate cost of marketing. Finish customers are tired of the lack of competition the retail trade hopefully we will have more competition in the future.

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