The pricing strategies of Hungarian food retail chains during the last recession

Zombor Berezvai ()
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Zombor Berezvai: Department of Economics, Eötvös Loránd University, Budapest, Hungary

Acta Oeconomica, 2015, vol. 65, issue 3, 393-411

Abstract: The paper seeks to explore the pricing strategies used by Hungarian food retail chains and how these strategies are related to the market and financial performance of the chains. A two-phase empirical research was carried out in 2011/2012. The research is based on 44 in-store observations, the analysis of price promotion leaflets and interviews with retail professionals. In-store observations focused on collecting data on baseline prices. The price promotion leaflets enabled the assessment of the promotional activity of the observed retailers. The interviews were used to check the validity of the research results. By grouping the analysed 11 retail chains along baseline price levels and price promotion activities, three different types of pricing strategies were identified. A relationship was found between the three pricing strategies and the performance indicators of the included chains. An important finding is that retail chains with a medium price level and low promotional activity were the least successful, while retailers with a low price level and high promotional activity achieved the best performance.

Keywords: retailing; pricing strategy; promotion; economic crisis; Hungary (search for similar items in EconPapers)
JEL-codes: M31 M37 (search for similar items in EconPapers)
Date: 2015
Note: The author would like to thank Irma Agárdi and Julianna Gálik for their encouragement and support. The author would also like to thank Márton Szabó, Gabriella Mile, Márta Stauder, Márton Edelényi, Attila Fodor and Aliz McLean for their comments on previous versions of the article.
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