You are on page 1of 8

3rd Quarter, 2009

Global Consumer
Confidence, Concerns
and Spending
a global Nielsen
consumer report
November 2009

INSIDE:
India, Indonesia and
Norway the most confident
Latvia and Japan the most
pessimistic
Global consumer confidence in
October rebounded to almost the
same level as the first half of 2008
FMCG sales increasing across
Latin America, Asia Pacific and Europe
Consumer confidence in China’s tier two
cities posted the highest rebound in the third quarter
Europe expects a longer road to recovery than
all other global regions
Consumer confidence is on the rebound as consumers start thinking beyond the recession,
with the global Consumer Confidence Index increasing nine points in the 3rd quarter
• Global consumer confidence index rose from 77 in April to 86 points
• Hong Kong (+14 points) South Korea (+13 points) and Brazil (+12 points)see strongest growth in confidence
• Consumer confidence fell in only two countries in the third quarter: Spain (-4 points) and Japan (-2 points)
• The U.S. posts first Consumer Confidence Increase since 2007 (+4 points)
• Biggest concerns are economy (18%), Job Security (14%), Work/Life Balance (12%)
• Spending still restrained but consumers opening up their wallets
• 66% of consumers globally say their country is in a recession now; and 26% say they’ll be out of a recession within 12 months

The world is emerging from the economic crisis and, with it, Despite this renewed sense of optimism, actual behaviour
global consumer confidence is rebounding, according to the remains restrained; many consumers remain skittish about
latest edition of the Nielsen Global Consumer Confidence spending their money and in some countries, spending habits
Index1, which jumped from 77 index points in April to 86 points appear to have changed permanently.
this month. Brazil and key Asian markets are posting double-
digit increases in consumer sentiment, while the U.S. recorded
its first increase in consumer confidence since 2007.

Nielsen Global Consumer Confidence Index


3rd Quarter, 2009 Changes 3Q 09 vs. 1Q 09
21 11 12 24 20 11 14 13 12 -2 10 22 15 16 10 13 23 -4 9 3 -2 6 11 10 3 2 10 5 4 6 2 1 0 8 4 2 10 2 2 -3 8 -5 8 7 3 2 -7 6 0 5 22 1 7

Changes 1Q 09 vs. 2H 08
-15 -6 -11 -12-21 -6 -12 -21 -7 -10 -8 -5 -7 -12 -12 -8 -18 -3 -13 -8 -3 -14 -13 -8 -16 -14-29 -6 -2 -16 -15 -5 -3 -2 -7 -9 -4 -3 -1 3 -11 -2 -1 -14 -9 -20-19 -22 -2 -5 -17 -2

120
120 115

110109
108
107106

102
101100100
98
100 96 96
94 94 93
92 92 91
89
87 86 86
85 85 85 84 84 84
Global Average 86
80 79 79
78 77 77
80 75 74
73 72
71 71
69 68
67 66 66
65

% 60 58
54 53 53
49 49

40

20

0
IL

FI

IE
IT

JP
LT
ID

EE
PL
SE

ES

LV
FR
IN

CL

BE

PT
AT

TR
AE

PK

SA
BR

VE

DE

EG
CZ
NL

ZA

US
AR
SG
CA
PH

TH
DK

RU

GB

GR
HK

UA

KO
AU

NZ

RO
CH
CN

MY

HU
VN

CO

MX

TW
NO

3rd Quarter 2009 Changes 3rd Quarter 2009 vs. 1st Quarter 2009

1
54 markets covered: Argentina, Australia, Austria, Belgium, Brazil, Canada, Chile, China, Colombia,Czech Republic, Denmark, Egypt, Estonia,
Finland, France, Germany, Greece, Hong Kong, Hungary, India, Indonesia, Ireland, Israel, Italy, Japan, Latvia, Lithuania, Malaysia, Mexico,
Netherlands, New Zealand, Norway, Pakistan, Philippines, Poland, Portugal, Romania, Russia, Saudi Arabia, Singapore, South Africa, South
Korea, Spain, Sweden, Switzerland, Taiwan, Thailand, Turkey, UAE, United Kingdom, US, Venezuela and Vietnam.
* Ukraine first introduced to survey in 2nd Quarter 2009 but results not shown on this chart, hence no comparison is shown. Saudi Arabia first introduced in 1st Quarter 2009.
Nielsen’s Global Consumer Confidence Index tracks consumer
confidence, major concerns and spending habits among more All of the BRIC markets saw increases in
than 30,500 Internet users in 54 countries. In the latest round consumer confidence
of the survey conducted between 28 September and 16
120
October 2009, Hong Kong posted the largest consumer 120
112
confidence increase in the third quarter compared to the 2nd 108
101
Quarter, up 14 points from 79 to 93 index points, followed by 100 96
99
95
South Korea (+13 points) and Brazil (+12 points). 88
85
89
82
India, Indonesia and Norway continued to top the global 80 75

rankings for the most confident nations, while the most


pessimistic nations were Latvia and Japan. Consumer 60 +12 +3 +8 +6
confidence rose in 45 out of the 52 countries compared to six
months ago. In April, the Nielsen Consumer Confidence Index 40
hit its lowest point of 77 index points, but as massive stimulus
plans began to take effect around the world during the second 20
quarter, consumer confidence slowly began to recover.
0
Brazil Russia India China

The tide has turned: growing indicators of 1st Quarter 09 2nd Quarter 09 3rd Quarter 09
confidence in Asia and Latin America
The surge in consumer confidence signifies return to positive
territory, showing that in the last six months, a majority of
consumer sentiment across the globe has shifted gears from
recession to recovery. In this economic climate, sentiment is Consumer Confidence Index
closely correlated to actual sales. In Australia, consumer Top 10 most confident countries 3rd Quarter 2009
confidence rose 11 points in the 3rd Quarter, and strong
economic conditions prompted the Reserve Bank of Australia 120
120 115
to raise rates, becoming the first G20 country to do so. 110 109 108 107 106
Correspondingly, sales increased two percent in August and 102 101 100
100
September in defined fast moving consumer goods (FMCG)
categories, while online sentiment (buzz) regarding the
80
recession is at the lowest levels since Nielsen began tracking it
in January 2009. %
60
Among other BRIC nations, consumer confidence rose 8 points
in India, 6 points in China and 4 points in Russia compared to 40
the previous quarter. Consumer confidence fell in only two
countries in the third quarter: Spain (-4 points) and Japan (-2 20
points).
0
IN ID NO VN BR PH AU AE CN NZ

Base: all respondents 30, 624

3
Australia and New Zealand also posted double-digit increases One key indicator of business confidence, Asia Pacific ad
during the last quarter, while Europe’s two largest economies, spending, rebounded much faster than expected by many
France and Germany, posted the highest increases in the analysts, with a year-on-year increase of nine percent and an
Eurozone, up 7 and 5 points, respectively. estimated US$111.94 billion spent in the region during the
Global consumer confidence in October rebounded to almost second quarter. Across many markets in Latin America, Asia
the same level as the first half of 2008 before the very worst Pacific and Europe, sales of FMCG are increasing as consumers
of the financial crisis hit global markets. The Nielsen survey start buying discretionary items after a prolonged period of
shows how much the pace of economic recovery has accelerated sticking to a tight budget and the essentials – all indicators
in the last six months, especially in Brazil and some Asian that the global recession is coming to an end.
markets. Nielsen consumer, retail and media data also shows a
trend of consumers shifting gears from recessionary into
recovery mode.

Thinking beyond the recession


In October, 66 percent of global consumers said their economy sectors are seeing a recovery – from high ticket retailing to
is in recession compared to 77 in April 2009, but for many property and finance. This has yet to translate into FMCG
consumers in Asia Pacific and Latin America, the recession is packaged goods with sales remaining relatively stable throughout
becoming past tense. Amongst Chinese, 87 percent said their the year.
nation is out of recession, while over 60 percent of citizens in
China’s six point increase in the last quarter was driven by
Hong Kong, Norway and Australia said the same. Meanwhile,
strong improvements in local job prospects and personal
half of Brazilians, Indians and Chileans also believed that the
income across the country. Nearly six in ten Chinese consumers
recession has ended. Among consumers who say they are still
described local job prospects as good or excellent in the next
in recession, one in five (26%) expect that their country will be
12 months, a 14 percent increase compared to the second
out of recession within 12 months.
quarter. Consumer confidence in China’s tier two cities posted
In Hong Kong, the number of consumers who said they were in the highest rebound in the third quarter, up 22 percent
recession dropped by nearly 30 percent in the last three compared from the previous quarter.
months. In the latest survey, 32 percent of Hong Kong consumers
In July Nielsen witnessed consumers starting to feel that the
said they were in recession compared to 60 percent in June
economy had bottomed out and was on the road to recovery.
2009. After several quarters of holding back and with the Hang
In the third quarter we see an extension of this optimism.
Seng index rebounding to its pre-financial crisis levels in
Consumers in China are still hesitant to go out and spend
October and sales of properties seeing a significant increase,
money, yet the results indicate that there is a willingness to
consumers in Hong Kong are beginning to open their wallets
spend on new products. Companies that focus on innovation
again. They’re increasing their spend on discretionary items
and introducing new products to the market will be the ones to
such as new clothes, out of home entertainment, technology
drive consumption throughout China.
and holidays which they cut back a year ago. As a result many

4
Do you think your country is in an economic recession at the moment?
1st Quarter 2009, Recession Casts A Gloomy Outlook

% Saying Yes
0% to 25%
25% to 50%
Global Average 66% 50% to 75%
75% to 100%
Source: Nielsen Global Online Survey October 2009

Do you think your country will be out of an economic recession in the next 12 months?
3rd Quarter 2009

% Saying Yes
0% to 15%
Global Average 26% 15% to 30%
30% to 45%
45% to 60%
Source: Nielsen Global Online Survey October 2009

5
How to utilise spare cash after covering essential living expenses
Global Average
1st Quarter 2009 3rd Quarter 2009

48
Putting into savings 47
31
Holidays/vacations 33
28
New clothes 31
32
Paying off debts/credit cards/loans 30
25
Out of home entertainment 27
22
Home improvements/decorating 26
21
New technology products 24

Investing in shares of stock/ 18


20
mutual funds
13
I have no spare cash 13
10
Retirement fund 10

Base : All respondents n=27548

The recession is official


How to utilise spare cash after covering essential
living expenses: Top10 Countries putting into savings South Korea’s Kospi index is up nearly 50 percent since the start
of the year and a weak Won has provided an attractive boost for
100 its manufacturing and export industries, especially for its key
export sectors of consumer electronics and cars. Brazilians’
confidence was the highest in South America, and strong
80
73 71 economic growth, combined with the winning bid of Rio de
67 66 64 64 64 Janeiro to host the 2016 Olympic Games, have clearly buoyed
60
60 59 59 the nation’s outlook.
% As the last country to enter the global recession and among the
40
first to recover, Brazil has essentially returned to pre-crisis levels
of industrial production. Employment is rising, and along with
that, consumer consumption. Brazilians are feeling very optimistic
20 about their future: the 2016 Olympic Games, combined with the
2014 World Cup as well as new energy projects guarantee a high
level of infrastructure investment for the next few years, and
0
PH HK ID SG IN MY TW KO CN AE
Brazilians are rightly feeling confident about the economic
future.
Base : All respondents n=27548

6
Cautiousness in Europe, North America Concerns
For the rest of the world however, sentiment towards economic While global consumers continue to voice concern about job
recovery remains moderate, and with it, consumer spending. The security and the economy, many have started to focus on other
majority of consumers in the U.S. and Europe have conceded to a issues. Worry about job security has decreased over the past six
measured economic recovery. While consumer confidence in the months. In April, 20 percent of global consumers named job
U.S. edged up 4 index points in the 3rd Quarter – the first security as their main concern in life, closely followed by the
increase since early 2007 – that hasn’t translated into spending economy (19%). Today, 18 percent of global consumers say the
confidence for the vast majority of American consumers. This economy is their prime concern, followed by job security (14%).
recovery will be manifested in measured and restrained spending
Issues such as work/life balance and health both increased by
as consumers work to repair their balance sheets.
three percentage points in October compared with six months
Among those consumers who believe they’re currently in ago, another indication that consumers’ obsession with every-
recession, over 60 percent of French and Irish believe that thing economy and recession-related is beginning to subside.
economic recovery is more than a year away. Of all regions,
Europe – especially Eastern Europe – expects a longer road to
recovery than all other global regions including North America,
according to the survey. Consumer confidence in Eastern
European countries recorded an average of 10 index points
lower than Western European nations. Spain, which posted the
only consumer confidence decline in Western Europe in the third
quarter, is expected to be the only Eurozone nation to contract
in 2010, according to latest IMF projections.

Biggest concern over the next six months


Global Average
1Q 2009 3Q 2009
19
The economy 18
20
Job security 14
9
Work/life balance 12
7
Health 10
5
Childrens education and/or welfare 7
7
Debt 7
5
Increasing utility bills (electricity, gas, heating, etc) 6
4
Increasing food prices 5
2
Global warming 3
Crime
2
3 %
2
Political stability 3
3
Parents welfare and happiness 3
1
Terrorism 2
4
Increasing fuel prices 2
2
War 1
1
Immigration 1
3
Other concern 3
2
No concerns 2

Base : All respondents n=27548

7
Country Abbreviations
AE United Arab Emirates IT Italy
AR Argentina JP Japan
AT Austria KO South Korea
AU Australia LT Lithuania
BE Belgium LV Latvia
BR Brazil MX Mexico
CA Canada MY Malaysia
CH Switzerland NL Netherlands
CL Chile NO Norway
CN China NZ New Zealand
CO Colombia PH Philippines
CZ Czech Republic PK Pakistan
DE Germany PL Poland
DK Denmark PT Portugal
EE Estonia RO Romania
EG Egypt RU Russia
ES Spain SA Saudi Arabia
FI Finland SE Sweden
FR France SG Singapore
GB United Kingdom TH Thailand
GR Greece TR Turkey
HK Hong Kong TW Taiwan
HU Hungary US United States
ID Indonesia VE Venezuela
IE Ireland VN Vietnam
IL Israel ZA South Africa
IN India

About the Nielsen Global Consumer Confidence Survey


The Nielsen Global Consumer Confidence Survey was conducted between 28 September – 16 October and polled over 30,624
consumers in Europe, Asia Pacific, North America and the Middle East about their confidence levels and economic outlook. The
Nielsen Consumer Confidence Index is developed based on consumers’ confidence in the job market, status of their personal
finances and readiness to spend. The sample has quotas based on age and sex for each country based on their Internet users, and is
weighted to be representative of Internet consumers and has a maximum margin of error of ±0.6%.

About The Nielsen Company


The Nielsen Company is a global information and media company with leading market positions in marketing and consumer
information, television and other media measurement, online intelligence, mobile measurement, trade shows and business
publications (Billboard, The Hollywood Reporter, Adweek). The privately held company is active in more than 100 countries, with
headquarters in New York, USA. For more information, please visit, www.nielsen.com