Both the number of e-shoppers and the frequency of online buying have seen strong growth over the past few years. There are two main drivers of e-commerce growth in Hungary. The development level of the digital economy, especially internet and device use, is a key direct driver, while net monthly earnings, inflation and household consumption, all have an indirect influence on e-commerce development, says associate professor of University of Miskolc, Szabolcs Nagy.
“E-commerce is not the future any more. It is the present,” said Mastercard product specialist, Máté Nemes declared at the latest Portfolio Banking Technology conference.
Between 2017 and November 11, 2018 the number of active Mastercard cardholders in Hungary increased by 23. Despite the fact that the most popular payment method for e-commerce in Hungary is still cash on delivery by courier service, Mastercard recorded the most significant growth among frequent bankcard users: its rate of five transactions a month was up from 10.3% in 2010 to 15.7% in 2016, Nemes added.
The trend is illustrated also by research conducted by internet research and consulting firm eNet. The net volume of online retail trade in Hungary exceeded the HUF 500 billion milestone in 2017, totaling HUF 545 bln in the entire year. The e-tail sector boasted more than tenfold growth over ten years, rocketing from HUF 46 bln in 2007, it says. The online retail market sector generated significant expansion of 27% in 2017 compared to previous year.
In terms of online shopping, information and entertainment electronics, general and sports clothing, as well as toys and presents generate the highest online turnover figures. The fifth largest product category is now furniture, home textile and lighting, ousting household machines and white goods from the top five, says eNet.
Foreign Purchases
Hungarian online shoppers are using foreign webshops more frequently. Since 2015, the number of Hungarians ordering goods from abroad has risen from 1.5 million to 2.7 million. It has especially high relevancy as a new European Union regulation enters into force as of December 3 that aims to prevent discrimination based on customers’ nationality, place of residence or place of establishment, including unjustified geo-blocking, in cross-border transactions between a trader and a customer for the sales of goods or the provision of services.
Research firm GKI Digital publishes a regular list of the top ten e-commerce companies in Hungary. According to the latest edition, Extreme Digital, emag, and Media Markt make up the top three places. Overall, the top ten firms generate 35% of total domestic e-commerce turnover, according to GKI Digital. Ecommerce News Europe put the e-commerce share of all retail sales at 6.2% in 2017.
According to statistics portal statista.com, revenue in the Hungarian e-commerce market will amount to USD 1.888 mln in 2018. Revenue is expected to show an annual growth rate (CAGR 2018-2023) of 7.4%, resulting in a market volume of USD 2.693 mln by 2023. User penetration is 69.1% in 2018 and is expected to hit 73.4% by 2023. The average revenue per user (ARPU) currently amounts to USD 280.50, statista.com says.
Hungarian internet users plan to spend HUF 41,000 (about USD 145) on average on Christmas gifts this year, almost 18% more than a year earlier, according to a market survey conducted by GKI Digital.
[“source=ndtv”]