Consumer confidence is on the rise

Since Match and Profi went out of business last year, the number of major grocery retail chains fell to nine in 2013. However, this change didn’t have an influence on the market share of modern store types in grocery retail: in 2013 they had the same 29 percent from sales as in 2012.

Discounters’ 20-percent share and the 16-percent share of organised grocery retailers’ large stores were also stable. The situation was different with household chemicals and cosmetics: hypermarkets’ share dropped from 36 to 34 percent in 2013, while drugstores and pharmacies share was up 1 percentage point each. As for consumer sentiment, in each quarter of 2013 at least 80 percent of Hungarians said they had changed their spending habits to save money; what is more, at least 70 percent were trying to spend less by switching to cheaper groceries. Consumer confidence started growing: in Q4 2013 the consumer confidence index was at 51 points and in Q1 2014 it reached 54 points – a record height of recent years. Nielsen’s experience is that if consumer confidence changes, it takes two quarters to have its effect felt in sales. Combined sales in the 90 grocery and 70 household chemical and cosmetics categories audited by Nielsen amounted to HUF 1,740 billon, from which 81 percent was realised by groceries. Between February 2013 and January 2014 grocery sales in the 90 categories valued at HUF 1,420 billion, the same as in the base period, but volume sales decreased by 2 percent. In the last few years the household chemical and cosmetics market was above HUF 320 billion and in 2013 it expanded by 2 percent from the previous year. However, volume sales were down 3 percent from the base period.