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International Market Segmentation in Dairy Market
43-54Views:104The basis and primary condition of the production level worldwide is the stability of domestic consumption, therefore the size of milk production is determined by the domestic milk consumption apart from smaller or greater exceptions. The aim of this research is to accomplish an international market segmentation based on the volume of milk product consumption. Segment forming variables were the three-year average per capita consumption volumes of liquid milk, cheese (including cottage cheese), and butter in the particular national economies. 46 national economies and the European Union (EU28) were included in the research. After completing the segmentation, our further aim was to characterize the formed segments by the following macro factors: gross domestic product (GDP) per capita, gross national income (GNI) per capita, life expectancy at birth, crude mortality rate, unemployment rate, and consumption expenditures of households as a percentage of gross domestic product. Based on our results, three clusters were identified that significantly differ from each other. The first cluster includes those countries where liquid milk, cheese, and butter consumption per capita are low. The second cluster contains those nations in which per capita consumption can be seen as medium level, Hungary is in this group. In the third cluster we can find countries with high per capita consumption compared to the sample. The formed segments show significant differences according to both GDP and GNI. In the case of segments with higher milk product consumption the means of GDP and GNI are significantly higher on purchasing power parity. In the countries where a higher proportion of gross domestic product is consumed the volume of milk product consumption is lower, while in those countries where a lower proportion of GDP is consumed, the per capita volume of milk product consumption is higher. We found a significant difference among the segments according to the life expectancy, too; life expectancy increases in line with the increase in per capita milk, cheese, and butter consumption. In case of the unemployment rate, we could not find any significant differences among the segments. To sum up, we can conclude that consumption of the examined product categories can be seen as medium in Hungary, i.e. our country belongs to the second segment. Beside Hungary, we can find seven further post-communist countries in this segment that shows the cultural similarity of the region. An important strategic task for Hungary is to increase milk product consumption by the means of communal marketing tools. The consumption of milk products can reach a stable growth path via an appropriate positioning and conscious communications. To reach this goal, the image of the category has to be put in order and healthiness and nutritional advantages of milk products have to be highlighted, then consumer misbeliefs have to be corrected.
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The Progress of the Hungarian Dairy Prices Between 2003 and 2017
23-35Views:72There were notable changes in the dairy industry from 2012 onwards that seriously affected the Hungarian dairy market. The main events were the introduction of the Milk Package in 2012, the beginning of the Russian import ban in 2014 and the abolition of the milk quota system in 2015. These events affected the development of the domestic dairy industry, and at the same time, the Hungarian dairy sector faces long term challenges. The aim of our research is to analyse the dairy price developments between 2003 and 2017. We compare the Hungarian producer and consumer prices over time and we analyse the relationship between the domestic prices and some of the international prices as well. We calculated the coefficient of variation, price ratios and correlation for different time periods. The results indicate that there has been a strong market integration between the domestic and the international market since 2003.
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Online Marketing Possibilities of the Domestic Dairy Sector
55-65Views:138The online appearance of the local milk processing micro-, small and medium-sized enterprises is rather bare (e.g.: official website, social media site), so they are not really able to maintain the online information collecting and shopping demands of the Hungarian digital food-consumers. Without this active participation, consumers cannot be involved in the company processes, in spite of the fact that food related search for information and the eventual shopping are key elements in the willingness to turn consumers’ lifestyle towards a healthier way. We used primary and secondary marketing research methods. During the secondary data and information collection, we collected and arranged already available data. During our primary data collection we carried out a quantitative research which was based on the analysis of our secondary data collection. We made our company observation project, where we analysed the online appearance of the members in the local milk industry with the help of an observation sheet, based on the database of NÉBIH (National Food Chain Safety Office). The members of the dairy industry (88 companies) were filtered for factory types and processed species. Fifty-nine per cent of the milk processors provide a personal online platform for the users. A third of the related milk processors have Facebook account. In the examined sector, every second company refreshes its timeline, or adds new entries less often than monthly, which is an extremely low tendency. Based on the results, we can say that these processing companies have exclusively Facebook accounts within the different types of social media, and they are quite passive. With the previous observation, we took into consideration the methods and tools given to the examined companies in order to judge the involvement of the consumers in the company processes. The rate of this involvement was observed on a Likert 1 to 5 scale and the obtained results were disappointing and regrettable. The value was 1.93 in the case of milk processors with a website and/or Facebook account. The results strengthen our assumption that the local companies in the related sector are not eager at all, or only at a minimum rate to involve consumers in the company processes.
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Economic Analysis of a Good Quality Hungarian Dairy Farm with Leading Technology
43-64Views:234The research includes an economic analysis of the dairy farm based on farm data, which makes it possible to assess the cost-income ratio and partial efficiency of each sector, assuming that it operates at a good production level, and in the case of assumed greenfield investments, economy based on dynamic indicators (NPV, IRR, PI, DPP). As many domestic dairy farms produce with the most advanced technology available, and their indicators do not lag far behind the best farms in Western Europe, the so-called analyses refer to “good production standards or practices”. The performed analysis is based on a deterministic simulation modelling created from a production plant’s primary data which uses its own database. Some of the research findings are supported by data and calculations, while others are based on expert estimates and expert opinions. Based on our investigations, it can be stated that the so-called most important specific natural, economic, and investment analysis indicators of the model plant following good production practice in the case of milk production are the following: Specific annual milk yield 11,000 kg/year; Production value: 1,548.5 thousand HUF/cow; Production cost: 1,312 thousand HUF/cow; Net income: 236.5 thousand HUF/cow; EBITDA: 404.6 thousand HUF/cow; Discounted payback period without investment subsidy: 11 year; Discounted payback period at 50% subsidy intensity: 6 years.
JEL codes: Q12, Q13 -
Milk Heart Campaign
67-73Views:200Boglárka Kapás, Tamás Kenderesi (Olmypic swimmers) and Ádám Nagy (national football player) joined the Milk heart campaign in 2017 which is financed by the Milk Interprofessional Organization and Product Board, Community Marketing Fund. This campaign drawed attention to the consumption of domestic dairy products.