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2nd Quarter, 2011

Global Online Consumer Confidence, Concerns and Spending Intentions
A Nielsen Report July 2011

Chief Economist at The Cambridge Group. Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism. In the latest round of the survey. “Weak economic figures.” Copyright © 2011 The Nielsen Company.” said Dr. Hopes for full global recovery in the next 12 months substantially weakened in Q2 as the majority of consumers around the world remained in a recessionary mindset. regions of the Middle East/Africa and Asia Pacific posted the steepest declines of 12 and nine points respectively compared to last quarter.More consumers slip back to recessionary sentiment levels in second quarter • • • USA Consumer Confidence Drops Asia Pacific and Middle East/Africa Regions Suffer Declines. tracks consumer confidence. an intensifying debt crisis in Europe and continuing political instability in the Middle East combined with rising household expenses in the U. Asia Pacific remained the most optimistic region at 98 points. major concerns and spending intentions among more than 31. followed by Middle East/ Africa at 94 points. have taken their toll on consumers’ fragile confidence.000 Internet consumers in 56 countries. established in 2005. “There wasn’t enough positive news to inspire confidence among global online consumers in the second quarter. slowing manufacturing performance and inflation in Asia. but current figures are aligned with year-ago trends. Despite its nine point dip. Venkatesh Bala. conducted between May 20 and June 7. but Remain Most Optimistic Cash-Strapped Consumers Plan Further Cuts in All Discretionary Spending The Nielsen Global Online Consumer Confidence Survey. 1 . And confidence levels in Europe (74) and Latin America (91) remained largely unchanged edging up one index point each. Global online confidence declined to its lowest level in six quarters to 89 as economic recovery hit a stumbling block and recessionary jitters again reverberated around the world. according to Nielsen’s quarterly Global Online Consumer Confidence Survey. a part of Nielsen. 2011.S.

as has begun to occur recently. 2 .Recessionary Mindset “Second quarter data revealed that consumers have retreated back into a recessionary mindset and they are tightening their belts again after the last 12 months of slowly improving.” said Dr. consumers globally will look to greater stability in food and energy prices. The number of Asia Pacific online respondents who said they are currently in recession rose from 37 percent in Q1 2011 to 45 percent in Q2. And in Middle East/Africa. “According to the latest survey. Of those. 45% 47% 32% 35% 32% 34% 29% 29% 28% 28% 22% 26% 19% 51% 31% 50% 17% 29% 16% 21% 21% 18% 21% 15% 9% 11% 3% 3% Copyright © 2011 The Nielsen Company.” In another indication of how consumers are prolonging the recession sentiment. along with abatement of region-specific concerns. the economic recession lives on for 74 percent of online respondents – an increase of nine points from three months ago. Bala. but cautious spending. more than half (51%) believe they will still be in a recession in a year’s time. For the outlook to improve for the rest of the year. consumer allocation intentions declined globally in all discretionary areas from investing in stocks and buying clothes to taking holidays and upgrading technology compared to three months ago. 58 percent of global online consumers said they are still in a recession – the most in the past year.

35 percent of global online consumers said the present was a good time to buy the things wanted and needed. At the start of this year.S. Thirty-one percent of U. but this receded to 20 percent last quarter. Likewise. 3 . Rising food prices was again consumer’s top global concern. one year ago.Spending Intentions Decline Twelve months ago. 13% 12% 10% 9% 8% 12% 10% 8% 7% 11% 8% 7% 6% 6% 3% 8% 7% 6% 5% 4% Copyright © 2011 The Nielsen Company. but this figure dropped to 27 percent in second quarter with significant pull back among North American and Asia Pacific consumers. surpassing the economy as the top concern for the second quarter in a row. 40 percent of Asia Pacific consumers felt it was a good time to buy things needed and wanted. consumers said they have no spare cash for discretionary spending. 27 percent of North American consumers said it was a good time to buy. along with 25 percent of Middle East/Africa consumers and 22 percent of Europeans. More consumers globally are feeling cash strapped as cost of living expenses and rising food and energy inflation continue to squeeze household budgets. but this figure fell to 32 percent in Q2.

while dollar sales for the latest quarter within that 52-week period were up 0. the top 20 percent of households have exited the recession.” continued Hale.4 percent for the 52-weeks ending June 11. unsettling weather patterns creating flooding and tornado damage and a stagnant job market. retail front. fell five index points to 78. Canada’s consumer confidence index holds steady at 101. 2011. “Consumer-packaged-goods dollar sales were off 0.S.5 percent – the second consecutive quarter of at least modest growth. confidence among U. inflationary pressures at check-out. continued woes in the housing market with home foreclosures and declining property values. SVP Consumer & Shopper Insights. consumers fell in the second quarter. two points lower than the previous consumer confidence low of 80 points in the first half of 2009 at the height of the global recession. dropping just one point from year ago and previous quarter findings. “With rapidly rising gas prices. “On the U. 4 .S.S.” Copyright © 2011 The Nielsen Company. while all other households are showing continued restraint in shopping trips and spending. Consumer Confidence Drops Consumer confidence in the U.” said Todd Hale.S.U.S. Nielsen U.

households will be hit by one of the biggest rises in the cost of living in decades – utility bills. causing food prices to rise. The continued strength in domestic consumption is a reflection of continued overall optimism in the economy. 22% 27% 7 48% 37% 13% 3 52% 35% 29% 9 44% 27% 15% 18% 16% 30% 39% 8% 14% 11% 59% 59% 19% 14% 14% 9% 10% 8% 7% 7% 6% 5% 4% 3% 13% 6% 6% 6% 4% 43% 24% 20% 8% 22% 15% 15% 35% 10% 6% 9% 10% 12% 16% 2% 4% 7% 18% 26% 39% 40% 10% 9% 38% 9% 36% 37% 24% 46% 30% 46% 30% 29% 32% 25% 24% 23% 31% 38% 12% 5% 47% 41% 40% 13% 11% 11% 32% 2% 3% 3% Copyright © 2011 The Nielsen Company. “A host of factors are weighing heavily on the Indian consumer’s mind. “The slight drop in consumer confidence in China is reflective of inflation. “And the January floods. Belt-tightening is the norm for many households as price increases erode family budgets.” Eight out of 14 Asia Pacific markets posted quarterly declines in Q2 with steepest declines from Australia (-7 points) and Singapore (-6 points). which is still a top-of-mind issue for consumers.Slowdown Impacts Outlook.” Malaysia (110). Nielsen Pacific. as observed in the second quarter of 2011. Nielsen India. fuel price hikes and an uncertain global economy are acting as constraints to a buoyant outlook.” said Justin Sargent. Philippines (115) and South Korea (52) posted quarterly confidence increases and Hong Kong (107) remained flat. “We are likely to see adjustments to the purchase basket in terms of greater ‘value-consciousness’ guided by robust demand. heated price inflation. New Zealand (97). While still clearly the most optimistic across the globe. Nielsen Greater China. which restricted supplies of fruit and vegetables. had lingering effects on produce costs. water and gas prices all increasing. Managing Director. From July 1. Managing Director. Managing Director. there aren’t any signs of slowdown in consumption – even in discretionary categories. 5 .” said Karthik Rao. While inflation has continued to creep up in the last three months. Australia’s index has been on the decline since Q3 2010.” said Chris Percy. But Asians Remain Optimistic Indian consumers (126 index). remained the most positive about job prospects and personal finances and have consistently reported the highest consumer confidence scores since Nielsen consumer confidence tracking began in 2005. despite a five point quarterly decline. China’s consumer confidence declined three points quarterly to 105 and is four points off its year ago index of 109. but a large pull back in terms of overall spending is unlikely unless inflation continues unabated. “Australian households are being hit hard with unrelenting price increases across the board. driven by growth in income levels. These are set to soar with electricity.

Middle East/Africa Region Confidence Declines Largest confidence declines in Q2 were recorded in Egypt (-10) and Saudi Arabia (-11). Managing Director. but are down slightly from year-ago trends. “The package created a lot of positivity where people became more optimistic about the job prospects as well as their personal finances. 16% 28% 8% 45% 5 45% 14% 4 50% 28% 8 44% 40% 29% 22% 5% 14% 24% 36% 18% 7% 8% 38% 36% 11% 11% 10% 10% 10% 9% 5% 5% 5% 5% 5% 4% 7% 7% 6% 5% 6% 15% 16% 25% 10% 17% 12% 23% 30% 9% 5% 2% 7% 7% 12% 4% 12% 25% 18% 20% 24% 20% 10% 10% 30% 7% 18% 25% 22% 35% 33% 46% 32% 17% 22% 20% 32% 22% 9% 11% 18% 16% 43% 47% 28% 17% 5% 7% 29% 7% 5% 4% Copyright © 2011 The Nielsen Company. Political instability has become less of a concern for Saudi’s since the fizzling out of the “Day of Rage” that was planned in the Kingdom on March 11. Nielsen Egypt. which had enjoyed the biggest increases in Q1 2011.” said Ram Mohan Rao. Managing Director. the Q1 surge in optimism caused by the additional cash injected into the market by King Abdullah was toned down as consumers were also hit by increasing food and rental inflation as a result of more liquidity in the market.” The dip in Saudi Arabia confidence is also a result of decreased confidence in the economy where almost twice the consumers have said that economy is their biggest concern over the next six months compared to the start of the year. “In Saudi Arabia. 6 . “In Egypt. Nielsen Saudi Arabia. the Saudi consumers continue to be one of the top 10 most optimistic consumers across the globe. South Africa (86) and Pakistan (88) show consistent quarterly performances. Despite the dip. The Saudi consumer confidence index stabilizes to the levels of Q4 2010 after showing an 11 point increase in Q1 2011.” said Arslan Ashraf. United Arab Emirates increased one index point from last quarter to 110 maintaining its 12 point jump from six months ago. but are trending consistently with year-ago performances. post-revolution optimism subsided and was replaced by a more realistic view of the country situation and a higher awareness of the economical aspect of the after revolution period.

France’s economic growth spurt at the start of the year exceeded expectations and the government is bullish about a two percent growth by the end of the year. “Overall. “But growing prices and utility bills are reducing consumer’s expectations to increase future purchases as Russians continue to be weary on the strength of their disposable income. “Overall confidence is still above the last two years and we expect this to be a temporary decline only. France’s eight point confidence boost from 61 to 69 points was a result of the economy’s one percent growth in Q1 – the largest growth increase France experienced since Q2 2006. Nielsen Germany. ongoing economic turmoil amid the escalating debt crisis and widespread domestic protests resulted in a further consumer confidence decline of four points in Q2 for the world’s most pessimistic country where confidence levels plummeted to a new low of 41 points. several public holidays and the royal wedding mania. Turkey suffered the biggest decline in the region with a drop of six index points to a score of 77. Managing Director. Managing Director. 7 .” said Dwight Watson. The region includes eight of the top 10 lowest consumer confidence scores in second quarter. “The German economy has now been growing strongly for more than one year. affected the perception on political stability and confidence.” In a welcomed sign of some positive news. Low perceptions on the state of personal finances combined with rising living costs have resulted in reluctance by consumers to spend. also supported by unrest caused by terrorism. German consumer confidence dropped four index points in Q2 to 88 due primarily to increasing prices and the fear of inflation hampered by the Greek crisis and the Fukushima effect. Copyright © 2011 The Nielsen Company. The tense environment. while still below the European average of 74.Europe’s Increasing Utility Bills and Inflation are Top Concerns Increasing utility bills and inflation again eclipsed the economy and job security as main concerns in Europe.” said Paul Walker. Nielsen Regional Managing Director. dropping to 82 points since the beginning of 2011. consumers in Russia feel more optimistic on the macro environment as job prospects in the next six months are favorable compared to last quarter. Nielsen Turkey. “The recent decline is mainly due to the anxious anticipation before the elections that took place on June 12. Unemployment rates are declining and job prospects are good.” said Ivar Michaelsen. which continues to hold down overall consumer confidence levels.” Consumer confidence levels in Russia remain low. It’s the everyday challenges of paying household bills and feeding families that are keeping consumers in Europe awake and worrying at night. This confidence has rubbed off on French consumers where one in three (33%) in Q2 expect personal finances for the coming year to be good/excellent – up from 25 percent in Q1 2011. but the German economy continues to show a bold recovery. Consumer confidence in the United Kingdom also spiked five points in Q2 to 72 with consumer’s optimistic spirits buoyed by the warmest spring weather in years. In Greece. Russia & North-Eastern Europe.

8 .33% 27% 7 55% 41% 18% 8 62% 2 57% 40% 53% 40% 31% 22% 18% 35% 37% 12% 20% 10% 32% 34% 11% 10% 13% 9% 8% 7% 6% 8% 7% 6% 6% 3% 11% 6% 7% 5% 4% 29% 22% 22% 14% 23% 30% 24% 42% 12% 10% 13% 12% 11% 12% 3% 7% 22% 21% 25% 32% 28% 10% 10% 32% 9% 24% 27% 26% 56% 31% 53% 28% 17% 19% 25% 13% 18% 5% 6% 26% 20% 47% 48% 29% 20% 8% 9% 23% 3% 2% 2% Copyright © 2011 The Nielsen Company.

Latin American Regional Confidence Rises One Point Latin America consumer confidence edges up one index point to 91. which led to an increase in food prices. delivers the highest index in the region with a score of 99. Country Manager. 25% 13% 3 53% 50% 11% 42% 49% 9 47% 48% 33% 13% 3% 34% 32% 12% 12% 11% 8% 9% 9% 9% 9% 8% 7% 4% 3% 8% 8% 11% 8% 3% 20% 15% 25% 9% 13% 31% 34% 38% 12% 5% 22% 20% 29% 37% 20% 13% 15% 8% 9% 1% 12% 19% 20% 36% 29% 22% 10% 10% 34% 9% 32% 35% 41% 40% 37% 52% 32% 21% 22% 33% 23% 17% 6% 7% 21% 15% 46% 48% 34% 14% 3% 6% 29% 1% 2% 3% Copyright © 2011 The Nielsen Company. Two additional Latin American markets were added in second quarter: Chile. which delivered a consumer confidence index of 91 and Venezuela.” Brazil increased one point to an index of 96 in second quarter and Mexico held steady at 80 for two quarters straight.5 percent rise in shopping basket consumption tracked by Nielsen. a rise in interest rates and a nine percent drop in the Colombian stock market. The growth is driven by consumer’s positive outlook in regard to their personal finances. Nevertheless. Argentina increases five points to a score of 93 – a level reported for three quarters straight in 2010. Colombia’s drop of two points since last quarter to 89 is driven by several factors: a harsh winter. “The possibility of drastic economic and political changes has spurred some fear in the minds of Peruvians.” said Armando Uriegas. there is clear uncertainty among consumers with the recent electoral outcome during Q2 2011. a new market added to the Nielsen Global Online Survey in Q2. “The study results show the macroeconomic boom that the country has experienced in the last few years. driven by positive quarterly performances in Argentina. Nieslen Peru. 9 . which is aligned with a 3. Peru. Brazil and Peru. which scored an 85.

Copyright © 2011 The Nielsen Company. 10 .

C. L. please visit www. Nielsen and the Nielsen logo are trademarks or registered trademarks of CZT/ACN Trademarks.L. the Middle East.V. This Nielsen survey is based on the behavior of respondents with online access only. was established in 2005. and is weighted to be representative of Internet consumers and has a maximum margin of error of ±0. For more information visit www. Africa and North About Nielsen Nielsen Holdings N. Internet penetration rates vary by country. For more information. All rights reserved.000 consumers in 56 countries throughout Asia Pacific. Nielsen uses a minimum reporting standard of 60 percent Internet penetration or 10M online population for survey inclusion. The Nielsen Global Online Survey. mobile measurement. USA and Diemen. the Netherlands. Other product and service names are trademarks or registered trademarks of their respective companies. 2011 and polled more than 31.nielsen. Europe. 11/3510 11 . with headquarters in New York. The sample has quotas based on age and sex for each country based on their Internet users. which includes the Global Online Consumer Confidence Survey. (NYSE: NLSN) is a global information and measurement company with leading market positions in marketing and consumer information.nielsen. Africa North America About the Nielsen Global Online Survey The Nielsen Global Online Survey was conducted between May 20 and June 7.Country Abbreviations: Argentina Australia Austria Belgium Brazil Canada China Chile Colombia Croatia Czech Republic Denmark Egypt Estonia Finland France Germany Greece Hong Kong Hungary India Indonesia Ireland AR AU AT BE BR CA CN CL CO HR CZ DK EG EE FI FR DE GR HK HU IN ID IE Israel Italy Japan Latvia Lithuania Malaysia Mexico Netherlands New Zealand Norway Pakistan Peru Philippines Poland Portugal Romania Russia Saudi Arabia Singapore South Africa Singapore South Africa South Korea IL IT JP LV LT MY MX NL NZ NO PK PE PH PL PT RO RU SA SG SA SG ZA KO Spain Sweden Switzerland Taiwan Thailand Turkey United Arab Emirates Great Britain Ukraine United States Venezuela Vietnam ES SE CH TW TH TR AE GB UA US VE VN Region Abbreviations: AP EU LA MEAP NA Asia Pacific Europe Latin America Middle East. trade shows and related properties. online intelligence. Nielsen has a presence in approximately 100 countries. television and other media measurement. Latin Copyright © 2011 The Nielsen Company.