20 April 2011
2.2 The Hungarian Consumer Profile
Hungary has a population with a fairly even distribution of different age groups. While children and teenagers aged 14 or below and elderly people aged 65 or above account for nearly one-third of the population, the majority of Hungarians fall into the age group between 15-64, which constitutes almost 70% of the population. Apart from students, these people are mainly office staff, manual workers and full-time housewives, who are the major decision-makers for daily consumer purchases. Despite the lingering unemployment after the global recession and the ongoing European sovereign debt problems, these people have been more willing to spend than before (i.e. prior to EU accession in 2004), thus comprising the mainstay of the Hungarian consumer market.
Interestingly, young people aged between 20 and 29 account for a relatively large 14% share of the population. They represent the generation growing up along with the country's liberalisation in 1990s, and are more influenced by Western culture. As they usually have a higher disposable income ratio due to lesser economic and family burdens, they have become major buyers, especially of fashion products. Yet working adults aged 30 or above have remained the most influential group in the consumer market for a wide range of household goods and consumer durables. While generally appreciating Western-style fashion products, they pay more attention to price and quality than do youngsters.
A typical Hungarian family comprises a couple and a child. These small families generally are not greatly burdened by housing and mortgage payments, although 19% of their expenditure is on housing, maintenance and housing energy, and 20% on transport and communications. Meanwhile, about 6% of household expenditure is used to purchase furniture and other household equipment like washing machines, cookers, lighting appliances and other household electrical appliances, while another 3% goes for clothing and footwear. Three per cent is spent on health and personal care items, including pharmaceuticals and health-care products. The remaining is spent on items like culture, recreation and entertainment products, including audio-visual equipment and sporting goods.
Following years of market reforms and robust economic performance, most households in the country already own a wide range of durable goods, including colour TV sets and hi-fi equipment. They do not lack household equipment, as many already have refrigerators/freezers, washing machines, vacuum cleaners and microwave ovens. Against this background, sales of many general consumer goods and basic items in Hungary are largely created from replacement sales. Along with rising incomes, Hungarian consumers, despite somewhat hampered by the recent recession, have been increasingly spending to improve their living standards rather than fulfilling basic needs. As a result, features, functions, styling and quality of products have become the keys to stimulating purchases. Amid enhanced competition brought about by foreign players in the retail market, successful products should be competitively-priced, with a quality level that is equivalent to those offered in Western Europe.
Average retail prices of selected consumer goods in Hungary
|Specification||Price (in HUF)|
|Ladies’ pullover – per piece||4,720|
|Ladies’ shoes, leather, man-made sole – per pair||11,510|
|Men’s shirt, long sleeved – per piece||5,770|
|Men’s shoes, leather, man-made sole – per pair||12,500|
|Children’s trainers, leather, man-made sole – per pair||7,190|
|Refrigerator – per piece||66,000|
|Automatic washing machine (for 4-5.5 kg) – per piece||75,160|
|Gas cooker – per piece||59,080|
|TV set – per piece||57,300|
|Hi-fi set – per piece||32,950|
* Average in 2009