From communism to capitalism: Tallinna Kaubamaja – Estonia's department store

ABSTRACT

Tallinna Kaubamaja opened its door in July 1960, and is the oldest and largest (in terms of sales) department store in Estonia. Tallinna Kaubamaja (Estonian for ‘Tallinn Trading House’, but known in English as Tallinn's Department Store), has gone through a number of changes over the past sixty years, both in terms of physical renovations, but also in terms of management and retail practices. Tallinna Kaubamaja is an exemplar of one of the few traditional department stores that had opened during the Soviet period, continued to exist during the re-independence period in the early 1990′s, the privatization period in the mid 1990s, and a period of expansion and greater competition through the first two decades of the twenty-first century. The focus of this historical review is to address the following questions; how did this traditional department store manage to succeed for six plus decades through such change, and what is the legacy of being a Soviet era store located in country that was vehemently opposed to being a Republic in the USSR?

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

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8 Jaakson, “Tourism in Transition in post-Soviet Estonia,” 617–634.

9 Trentmann, Empire of Things.

10 For a detailed overview of the role of the Department store in the West, see Howard, From Main Street to Mall.

11 Pino, Hero's Department Store, https://www.ohtuleht.ee/94380/kangelaskaubamaja.

12 Joost, a: Telephone interview with the author on September 16, 2009. Tallinn, Estonia. Jaagup Joost worked at Tallinna Kaubamaja from day 1 and retired as Deputy Director of the store.

13 Jones, and Monieson, “Historical Research in Marketing: Retrospect and Prospect,” 269–279.

14 Zlatanović, “A Multi-Methodological Approach to Complex Problem Solving,” 1–16.

15 All original Estonian texts were translated using Google Translate, then back translated by a native Estonian speaker.

16 Eesti Põllomees, (‘Estonian Farmer’) November 5, 1880 – page 1.

17 Postimees, (‘The Postman’) nr. 105, August 22, 1891.

18 Kannike, “Nostalgia at Home,” Journal of Baltic Studies, 153–175.

19 Lään, Ühenduses on jõud: 100 aastat rahvaga ja rahvale (Community has power: 100 years with the people).

20 The acronym ETK, due to its establishment in pre-Soviet times, continued to be used by the Estonian cooperative company that owed a number of Estonian retail brands. The name was changed in 2015 to COOP.

21 Merrilees, Miller, and McKenzie, “Cross-cultural Retailing Research,” 83–100.

22 Uustalu, Estonia: Story of a Nation.

23 Lään, Ühenduses on jõud: 100 aastat rahvaga ja rahvale (Community has power: 100 years with the people).

24 Jaakson, “Tourism in Transition in post-Soviet Estonia”.

25 Pino, Hero's Department Store, https://www.ohtuleht.ee/94380/kangelaskaubamaja.

26 Joost, (a) Telephone interview with the author on September 16, 2009.

27 Tamberg, Personal interview with the author on December 11, 2009. Tallinn, Estonia. Lilian Tamberg was the deputy head of the children's department at Tallinna Kaubamaja.

28 Joost, J. b: Personal interview with the author on December 9, 2009. Tallinn, Estonia.

29 Äripäev, (‘Business Day’) January 31, 2020 ‘Jubilee’.

30 Vaba Eestlane, (‘Free Estonian’) July 27, 1960 – page 1.

31 Vaba Eestlane, July 22, 1967 – page 2.

32 Joost, (a) Telephone interview with the author on September 16, 2009.

33 Joost, (b) Personal interview with the author on December 9, 2009.

34 Taagepera, Estonia—Return to Independence.

35 Tamberg, Personal interview with the author on December 11, 2009.

36 Szporluk, The Soviet West and the USSR.

37 The Abacus was the early ‘cash register’ that was used to calculate the customers’ total – due to the scarcity, and high cost of these machines, they remained a staple in a number of shops in Estonia into the late 1990s (McKenzie, 1998).

38 Pino, Hero's Department Store.

39 Joost, (a) Telephone interview with the author on September 16, 2009.

40 Shabad, “Soviet Schedules Shop Experiment”.

41 Szporluk, The Soviet West and the USSR.

42 Võitleja, ('The Fighter’) May 1, 1966 – page 8.

43 The well-known Estonian artist Olev Subbi first worked as a decorator at Tallinna Kaubamaja in 1962 - https://kultuur.err.ee/1069638/olev-subbi-naituse-taustalt-inspiratsioon-loodusest March 3, 2020.

44 Hanson, Advertising and Socialism.

45 Graham and Seldon, Government and Economies in the Postwar World: Economic Policies and Comparative Performance, 1945–85.

46 Tallinn Municipal Agency of Markets. Tallinna Kaubamaja majandualiskud näitajad 1960–1985 (Tallinn Department Store Economic Indicators 1960–1985).

47 Sirp ja Vasar, ('The Hammer and Sickle’) nr. 4, January 28, 1972 – page 15.

48 Joost, (a) Telephone interview with the author on September 16, 2009.

49 Ibid.

50 Eesti Päevaleht, (‘Estonia Daily’) May 15, 1985 – page 6.

51 Tallinn Municipal Agency of Markets, Tallinna Kaubamaja majandualiskud näitajad 1960–1985 (Tallinn Department Store Economic Indicators 1960–1985).

52 The majority of small goods sold in the store were wrapped in paper – customer shopping bags did not become common until after the Soviet period – McKenzie, Field notes, Tallinn Estonia, February. 2003.

53 Pino, Hero's Department Store.

54 Echikson, “Estonia's Amazing Kroon”.

55 Pino, Hero's Department Store.

56 Vaba Eestlane, January 12, 1993 – page 2.

57 Erlanger, “Estonia Savors Economic Success, But the Reformers May Be in Trouble”.

58 Post: Rahva tõeline hääl, (‘Post: The True Voice of the People’) November 11, 1994 – page 1.

59 Post: Rahva tõeline hääl, February 15, 1995 – page 1.

60 Post: Rahva tõeline hääl, June 19, 1995 – page 2.

61 McKenzie, Field notes, Tallinn Estonia, August 1–31, 1998.

62 Tohver, Personal interview with the author on December 10, 2009. Tallinn, Estonia. Peeter Tohver was the CEO of Tallinna Kaubamaja from Dec 1994 - Mar 2000.

63 The Stockmann Tallinn Department store eventually expanded to 5 floors, and in-terms of physical size, in 2000 became the largest, single location, department store in Estonia (http://www.stockmanngroup.com/en/history)

64 Eesti Päevaleht, November 7, 1996 – page 5.

65 Tohver, Personal interview with the author on December 10, 2009.

66 Eesti Päevaleht, June 4, 1998 – page 2.

67 Heikkinen, M. Tallinna Kaubamaja will stop in Kaisaniemi, Helsingin Sanomat, July 13, 1998.

68 Sokos opened a small store located in the shopping area in the VIru Hotel in 1995 (https://s-ryhma.fi/en/about-us/history). The store, and hotel are owned by the Finnish company S, Group, which also owns the Hypermarket Prisma. Ths Sokos store closed in 2000 when the first Prisma store opened in Tallinn. https://www.prismamarket.ee/blog/page/company 

69 Southall, European Financial Markets The Effects of European Union Membership on Central and Eastern European Equity Markets.

70 Rõõm and Urke, “The Euro Changeover in Estonia: Implications for Inflation”.

71 There were charges of plagiarism with the new logo as it was similar to the one of NK, Sweden's most well known department store (Eesti Päevaleht, October 16, 2003 – page 6)

72 Eesti Päevaleht, October 16, 2003 – page 6.

73 Tallinna Kaubamaja. Annual Report. 2004.

74 As early as 1963 concerns were raised that Tallinna Kaubamaja did not have a food department, as the city was growing very quickly “7,000 people live in the suburbs without streets, without water and without lighting”, Vaba Eestlane (Free Estonian) Wednesday, Dee 11, 1963 – page 3.

75 Tallinna Kaubamaja. Annual Report.

76 Other businesses operated at various times in Tallinna Kaubamaja including a foreign exchange service, and foreign currency shop, from 1980–1994, Lehtsaar, 50 Aastat Kaubamaja (‘50 Years as a Department Store’).

77 Eesti Päevaleht, April 26, 2001 – page 6.

78 The Tallinna Kaubamaja group was the largest retailer in Estonia due to its ownership of other retailing brands such as Selver (grocery stores); and Tallinna Kaubamaja King OÜ (shoe stores). The Tallinna Kaubamaja Group also owned beauty shops, car dealerships, a security business, and parking services (www.tkmgroup.ee).

79 Õpetajate Leht, ('Teacher's Newspaper’) June 17, 2005 – page 12.

80 Tallinna Kaubamaja. Annual Report.

81 Lehtsaar, 50 Aastat Kaubamaja (‘50 Years as a Department Store’).

82 Tallinna Kaubamaja. Annual Report.

83 Eesti Arhitektuuriliit (‘Estonian Architecture Union’). “Beginning of architectural competition for the Tallinna Kaubamaja quarter.” http://www.arhliit.ee/english/news/eal/press_release_tallinna_kaubamaja/.

84 Eesti Arhitektuuriliit. “CITY BREAK' wins Tallinna Kaubamaja Architectural Design Competition.” http://www.arhliit.ee/english/news/city-break-wins-tallinn-department-store-competition/.

85 Serada, “The Start of Construction of the New Tallinn Department Store is Delayed Due to a Dispute Between the City and the Developer,” Eesti Rahvusringhääling (‘Estonian Public Broadcaster’), err.ee March 18, 2021.

86 Tallinna Kaubamaja Group. “Coronavirus implications for Tallinna Kaubamaja Grupp AS business”, April 16, 2020.

87 Estonia is a world leader in IT infrastructure, which is evidenced by the slogan “E-stonia”. Mansel, “How Estonia became E-stonia”, https://www.bbc.com/news/business-22317297 May 16, 2013. In 2002 Tallinna Kaubamaja issued its loyalty card, Partnerkaart (“Partner Card”), the largest Estonian loyalty card. The card is required to purchase goods online from the Tallinna Kaubamaja e-poest (“e-shop”) https://www.kaubamaja.ee/meist/e-poe-klienditeenindus/kuidas-osta-e-poest.

88 Buckley, “Is the International Business Research Agenda Running Out of Steam?” 365–373.

89 Schaffer and Riordan, “A Review of Cross-cultural Methodologies for Organizational Research: A Best-practices Approach,” 169–215.

90 Hackmann, “From ‘Object’ to ‘Subject’,” 412–430.

Additional information

Notes on contributors

Brent McKenzie

Brent McKenzie is an Associate Professor in the Department of Marketing and Consumer Studies in the Gordon, S. Lang School of Business & Economics, at the University of Guelph. Dr. McKenzie is a leading expert on retailing and management in the Baltic States of Estonia, Latvia, and Lithuania.