Shops Reveal Hungarian Shopping Trends: Affordability Still Key, But Change is Underway
The trend of "downgrading" in shopping choices persists in Hungary, but stores are starting to see a noticeable increase in volume this is based on responses from the country's largest food chains to our inquiries.
The retail overview by Világgazdaság, drawing on feedback from Lidl, Tesco, Penny, and SPAR, highlights that despite lowered inflation rates, the lowest in the past three years, Hungarians continue to prefer private label goods, signaling ongoing caution. However, a positive shift is seen in the rising demand for non-food items.
Consumption in Hungary may recover slowly in the coming months, yet a process has begun that could lead to a significant breakthrough by summer, according to insights provided by the nation's leading retail chains. Világgazdaság inquired with chains like Lidl, Tesco, Penny, and SPAR about the anticipated shift in consumer behavior, expected by analysts and economic policy makers for months. Despite an increase in real wages since September, retail sales saw only a modest 0.6% increase in January.
Backdrop: The inclination towards economical shopping first emerged in the summer of 2022, influenced by rising inflation and a focus on price-to-value ratios in consumer decision-making. According to industry sources, this trend hasn’t ceased, with a notable rise in food demand observed. However, varied scenarios exist across different chains.
Tesco Experiences Volume Growth: Tesco noted a strong interest in private label products but observed increased attention to brand products during promotions, a trend also seen in non-food items. The English-owned company hints at potential boosts from upcoming sports events including the European Football Championship and the Olympics.
Penny Believes in Easter and Sporting Events: Analyses suggest summer sports could stimulate retail activity, supported by Penny Market's response. "Easter always brings significant sales growth, as do sports events, primarily the Football European Championship which we expect to positively impact consumption in certain categories like beers, soft drinks, salty snacks, and grill products. The Olympics might have a less intense effect,” said Penny Market. Penny also notices a strong preference for private label products among its customers.
Lidl Remains Optimistic but Sees Continued Preference for Own Brands: Lidl's experience points towards a continued shift towards value-for-money and promotional items, responding to increased price sensitivity with various discounts. Thanks to a consistent price reduction program, Lidl offers more than 600 products up to 50% cheaper compared to the same period last year, potentially lowering the overall shopping expense.
SPAR Observes No Change: Currently in a dispute with the government and facing losses in recent years, SPAR highlights its focus on fresh daily food and other groceries, seeing no recent change in non-food demand. The future might bring moderate, gradual increases, potentially aided by the summer season and sports events.
In summary, while economical choices dominate Hungarian shopping trends, a noticeable interest in non-food categories alongside cautious optimism for increased consumption driven by seasonal and sports-related activities is emerging.
Consumption in Hungary may recover slowly in the coming months, yet a process has begun that could lead to a significant breakthrough by summer, according to insights provided by the nation's leading retail chains. Világgazdaság inquired with chains like Lidl, Tesco, Penny, and SPAR about the anticipated shift in consumer behavior, expected by analysts and economic policy makers for months. Despite an increase in real wages since September, retail sales saw only a modest 0.6% increase in January.
Backdrop: The inclination towards economical shopping first emerged in the summer of 2022, influenced by rising inflation and a focus on price-to-value ratios in consumer decision-making. According to industry sources, this trend hasn’t ceased, with a notable rise in food demand observed. However, varied scenarios exist across different chains.
Tesco Experiences Volume Growth: Tesco noted a strong interest in private label products but observed increased attention to brand products during promotions, a trend also seen in non-food items. The English-owned company hints at potential boosts from upcoming sports events including the European Football Championship and the Olympics.
Penny Believes in Easter and Sporting Events: Analyses suggest summer sports could stimulate retail activity, supported by Penny Market's response. "Easter always brings significant sales growth, as do sports events, primarily the Football European Championship which we expect to positively impact consumption in certain categories like beers, soft drinks, salty snacks, and grill products. The Olympics might have a less intense effect,” said Penny Market. Penny also notices a strong preference for private label products among its customers.
Lidl Remains Optimistic but Sees Continued Preference for Own Brands: Lidl's experience points towards a continued shift towards value-for-money and promotional items, responding to increased price sensitivity with various discounts. Thanks to a consistent price reduction program, Lidl offers more than 600 products up to 50% cheaper compared to the same period last year, potentially lowering the overall shopping expense.
SPAR Observes No Change: Currently in a dispute with the government and facing losses in recent years, SPAR highlights its focus on fresh daily food and other groceries, seeing no recent change in non-food demand. The future might bring moderate, gradual increases, potentially aided by the summer season and sports events.
In summary, while economical choices dominate Hungarian shopping trends, a noticeable interest in non-food categories alongside cautious optimism for increased consumption driven by seasonal and sports-related activities is emerging.
Translation:
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