Supercharging Online Sales and Shuttle Diplomacy

Analysis

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We are hardly revealing a business secret if we tell you that the shopping restrictions and curfew periods of the early lockdowns gave the online businesses of the fast-moving consumer goods sector an unprecedented turbo-boost. What is more interesting is that, while that accelerated pace had dropped off since restrictions were removed, it has not gone away entirely. Indeed, research company GKI Digital reports that online FMCG sales grew by almost 45% in the first nine months of 2021 in Hungary, according to the “Online Retail Big Picture” survey.

According to data from the Central Statistical Office, the average basket value for online FMCG purchases approached gross HUF 21,000 in 2021, which is more than 10% of the monthly Hungarian minimum wage recorded on Jan. 1, 2022.

And more interesting even than that is the revelation that the leading players in the market are scrambling to bring waiting times down as public expectations have risen. Customer care has evolved massively in Hungary in the 23 years I have lived in this country, but that doesn’t mean I am not sometimes still amazed at what a company feels it can get away with. That doesn’t seem to apply here; this is the power of the free market in action. Each player needs to bring their times down or risk seeing customers go elsewhere. After all, pretty much every retail chain has an online presence nowadays. And that also means that quality matters. If the dispatchers pack the wrong items or they are damaged, online shoppers will vote with their feet. Or, more appropriately, their keyboard strokes.

As one of our contributors puts it in the FMCG Special Report inside this issue: “Further expanding our online business channels is a priority for us this year, responding to customers’ need for a fast and smooth shopping experience.”

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Sometimes in life, you have to let go of the big stuff, as it almost certainly says on a rubbish heap of Instagram memes somewhere. War in Ukraine will either happen, or it will not (as one respected BBC correspondent put it this week, either way, it will be a conscious decision, nothing is inevitable until it happens), but there is nothing any of us can do about it. Even so, it has been instructive to see how various NATO allies have gone about the business of making their position clear.

The shuttle diplomacy back and forth to Russia from almost all points West included Prime Minister Viktor Orbán, making a near-annual pilgrimage to the Kremlin (to be fair, Vladimir Putin is not an unknown visitor to Budapest). To be clear, Orbán was not going because of Ukraine, but it was inevitable that it would be discussed, and the Prime Minister made sure to speak to EU and NATO heads before he went calling. But on the very day Orbán sat down at that impressively long white table in Moscow, his staunchest EU ally, the Polish Prime Minister, was in Kyiv, along with the British PM. The diametrically opposed optics were as striking as they are impossible to ignore. But as Minister of Foreign Affairs Péter Szijjártó likes to say, nobody feels or fears conflict between the United States and Russia, whether hot or cold, like Central Europe. Let’s hope everyone keeps talking.

Robin Marshall

Editor-in-chief

This article was first published in the Budapest Business Journal print issue of February 11, 2022.

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