What comes after the mandatory promotions?
As of July 1, 2024, a significant change has taken place in the Hungarian retail sector: the mandatory in-store promotions, introduced just over a year ago on June 1, 2023, have been discontinued. An investigation by Index into the pricing strategies of major supermarket chains reveals varied approaches in the new regulatory environment.
Impact of the Mandatory Promotions
The government introduced mandatory promotions to help consumers access basic food items at lower prices despite high food costs. This included significant discounts on categories like poultry, dairy products, bread, pasta, and fresh fruits and vegetables.
Post-Regulation Pricing Strategies
With the cessation of these mandates, retailers are adopting diverse strategies to remain competitive:
- Lidl Hungary continues its price reduction program and offers additional discounts through the Lidl Plus loyalty program, featuring daily updated coupons.
- SPAR focuses on high customer service and value, showcasing weekly yellow tag items and weekend discounts, among other promotions through the SPAR Action Plan.
- Tesco maintains competitive pricing with Clubcard deals and has also removed VAT on its own brand of women’s sanitary products to help reduce costs for consumers.
- Aldi remains committed to providing consistently low prices, passing on savings from supplier negotiations directly to consumers.
- Penny plans to continue offering attractive promotions, with special weekend and start-of-week deals.
- Auchan emphasizes maintaining purchasing power, reducing prices on thousands of products and offering weekly special deals through the OkAuchan program.
Conclusions
Despite the end of mandatory in-store promotions, competition and consumer demands still drive retailers to offer favorable prices and promotions. The diverse strategies of various supermarket chains demonstrate that the market is dynamically adapting to new economic conditions, ensuring that consumers continue to have access to competitively priced products.
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