The Slando brand fell victim to globalization of the little known in Ukraine OLX

Investors often define the rules of brand movement on the market based on the most globally recognized name. Regional peculiarities are being inevitably blended in this process.

Photo: Konstantin Melnitskiy

International media and digital group Naspers is renaming Ukraine’s largest classifieds service Slando.ua into OLX.ua starting from September 15, the company announced yesterday.

OLX (short for online exchange) is a brand used by Naspers for the promotion of online classifieds market places in 114 countries. Its audience includes 140 mn unique users.

The Slando.ua project, which has been in operation in Ukraine for seven years, is visited by 4.5 mn people every month. At the end of 2012, Allegro Group – Naspers subdivision – merged two of its online classifieds projects in Ukraine, namely Slando.ua and the emarket.ua, into a single brand Slando. According to the survey conducted by the Factum Group in June, Slando.ua occupies the 11^th position in terms of reach of the Ukrainian online audience (daily reach – 7%, monthly – 30%). By this indicator the classifieds portal is ahead of the popular video hosting Ex.ua.

Slando has around 8 mn classifieds and every month nearly 2 mn new classifieds appear on it. In a week’s time, all visitors of the Slando domain will be automatically redirected to the new address OLX.ua. The company assures that the rebranding will only affect the name of the project, while the design and functions will operate in the usual regime.

Chain reaction

Naspers acquired Slando in 2011 for US $29 mn from a group of investors, which also included American eBay Inc. Replacement of the brand in Ukraine is the idea of the mother company. “In April 2014, the classifieds websites of Naspers group in Romania, Bulgaria, Kazakhstan, Belarus, Hungary and Poland were also renamed into OLX,” General Director of Slando.ua Serhiy Hapochenko told Capital. He said the objective of rebranding is expansion of the brand OLX on the international level, while the Slando brand will seize to exist as such.

Noteworthy, Naspers had to acquire a first-level domain and copyright for the OLX trademark in Ukraine from a Kharkiv resident Olena Savchenko, who also owns the rights for TM Trip Advisor, Outlook, smartphone and other well-known brand names in Ukraine. The price of the deal has not been disclosed.

Traffic loss

Allegro will launch a powerful ad campaign to promote the new brand in Ukraine. Interestingly, before withdrawal of Slando from the market, the brand was actively advertised on TV. The owners were thus heating up people’s interest in the news on rebranding. Marketing Director at Meta.ua Oleksiy Chuksyn says the new global advertising campaign, including TV advertising, will also cost a pretty penny for Allegro – namely, hundreds of thousands or even millions of dollars.

Market players believe that the value of such a change is doubtful. “The only advantage of the rebranding is the short domain name. The way I see it, there are many more disadvantages. Slando is a very popular and known brand,” says Business Development Director at the Fotos.ua online store Dmytro Pokotylo. He says the new name OLX seems unpronounceable to him and difficult to remember. “The risks when a user cannot remember the name of the site entail loss of direct traffic, while Slando has extremely high traffic,” warns the expert.

Chuksyn adds that users that were oriented towards Slando may initially experience difficulties in searching the place to where the online market moved, although he admits that Allegro has enough experience in rebranding popular Internet projects in Ukraine. “When they acquired auction.ua, they also transferred its users to their domain aukro.ua,” Chuksyn recollects.