CONSUMER CONFIDENC E - Nielsen · 2019. 5. 29. · CONSUMER CONFIDENCE A CANADIAN PERSPECTIVE 1 2014 C 2014 T N Company 1 CONSUMER CONFIDENC E A CANADIAN PERSPECTIVE ... categories-

1CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q1 2014 Copyright © 2014 The Nielsen Company

CONSUMER CONFIDENCEA CANADIAN PERSPECTIVE Q1 2014

2 CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q1 2014

CONFIDENCE BOUNCES BACK TO PRE-RECESSIONARY LEVELS GLOBALLY, BUT HOLDS IN CANADA Despite rising consumer confidence levels in the world’s largest

economies, Canadian optimism remains flat.

The Nielsen Global Consumer Confidence Index measures views

about job prospects, personal finances and the ability and willingness

to spend. These economic indicators are captured in a consumer

confidence level. A score of 100 is considered neutral. Levels above and

below that number show degrees of optimism and pessimism.

At 99, Canada’s confidence level was just under that baseline. That’s

down just slightly from 100 in the final quarter of 2013.

The stagnant Canadian confidence level also comes at a time when

confidence levels are up elsewhere. Globally, consumer confidence

returned to pre-recession levels, with an index score of 96 in the first

quarter of 2014 – up three points from this time last year, while Canada

is down three points over that period.

The global confidence level is the highest in the Nielsen surveys since

Q1 2007. Exactly five years, in Q1 of 2009, the global index recorded its

lowest score of 77.

Across the world’s six biggest economies, five demonstrated consumer

confidence gains. The U.S. confidence level is up six points, and at 100

is now higher than Canada’s confidence level.


NIELSEN CONSUMER CONFIDENCE INDEX

CANADA GLOBAL

100

99

97

98

102

Q4 2013

Q1 2014 Q1 2014

Q3 2013

Q2 2013

Q1 2013

94

96

94

94

93

Q4 2013

Q3 2013

Q2 2013

Q1 2013

“When it comes to consumer confidence, Canada’s in a bit of a holding

pattern while the majority of other countries take a step forward”, says

Carman Allison, vice president, Consumer Insights, Nielsen Canada.

Looking at many of the measures that make up the confidence index,

Canadian perceptions have actually remained steady. “Yet there are a

few warning bells,” explains Allison. “In the first quarter of the year, we

saw notable increases in the percentage of Canadians who feel we’re in a

recession, and who have changed their shopping patterns to save. At the

same time, when we look at what Canadians are doing with spare cash,

saving strategies are outpacing spending strategies.”


RECESSION FEARS RISEIn Q1, Canada showed an increase in the number of people who feel that

the country is in recession – 47%, which is up five percentage points but

back to the levels mid last year. That comes after a similar big swing,

downward, in recession perception in the final quarter of 2013.

In contrast, 55% of people globally say their country is still in recession,

and that’s down from 57%. While the recessionary mindset is back to

previous levels in Canada, it’s falling in the U.S. 63% of Americans now

say their country is in recession, down from 71%. The narrowing of the

gap between Canadian and American perceptions, despite the fact that

the U.S. economy was much harder hit, may be a temporary blip or a

troubling indicator.

CANADA

47%

47%42%

47%

49%

Q4 2013

Q1 2014

Q2 2013

Q1 2013

Q3 2013

DO YOU THINK YOUR COUNTRY IS IN AN ECONOMIC RECESSION AT THE MOMENT? (% ANSWERING YES)


MORE CANADIANS TRY TO PINCH PENNIESIn looking at their household expenses, more Canadians are employing

cost-cutting strategies. More than 6 in 10 Canadians, 63%, say they’ve

changed their shopping patterns compared to this time last year. That’s well

up from both the 55% who said the same in Q4 2013, and the 59% who said

so in Q3 of 2014.

“The desires to save and cut expenses are fueling a number of fast-moving

consumer goods trends, with more consumers shopping discount retail

formats and buying on promotion at record levels,” says Allison. “Currently

36% of retail sales are sold with a price cut – an increase from 27% since

2008.”

Nielsen inquires about 15 savings habits. A high percentage of Canadians

recognize the bite of take-away meals. Cutting back in that category showed

the biggest increase by far, as 60% of people now say they are looking to

save there.

Except for that category, the top eight are in the same order (the percentage

change from the Q4 survey is in parentheses). Besides take-away meals, the

category with the biggest change is car usage. 26% of Canadians surveyed

say they use it less often, vs. 31% in the previous survey.

Cut down on take-away meals: 60% (+10)Try to save on gas and electricity: 54% (+3)Spend less on new clothes: 54% (/)Cut down on out-of-home entertainment: 50% (+1)Switch to cheaper grocery brands: 48% (/)Delay upgrading technology (PC, mobile, etc.): 32% (-3)Delay replacing major household items: 31% (-2)Cut down on holidays/short breaks: 30% (-3)Cut down on telephone expenses: 28% (/)Use my car less often: 26% (-5)Cut out annual vacation: 25% (+1)Cut down on at-home entertainment: 23% (-5)Look for better deals on home loans, insurance, credit cards, etc.: 20% (-4)Cut down on or buy cheaper brands of alcohol: 16% (-2)Cut down on smoking: 13% (+2)


GREATER FOCUS ON SAVINGS STRATEGIESNielsen routinely asks what people do with their money after covering

essential living expenses. Here, we see almost no movement in spending

strategies from Q4. On the savings side, however, more Canadians

are putting money towards their own financial well-being in three key

categories- paying off debt, more savings and investing.

“Canadians continue to be focused on repairing the household balance

sheet with saving strategies ranking higher than spending strategies,”

says Allison.


WHAT DO YOU DO WITH YOUR SPARE CASH?

19% 42%

40%

14%

18%

20%

22%

14%

20%

25%

15% 38%

38%

10%

15%

28%

23%

15%

22%

29%

20% 37%

38%

11%

15%

19%

21%

17%

19%

26%

18%18%

35%39%

39%41%

11%14%

18%17%

19%20%

19%19%

15%16%

17%18%

28%28%

SPENDING STRATEGIES SAVING STRATEGIES

OUT-OF-HOME ENTERTAINMENT

PAYING OFF DEBTS/ CREDIT CARDS/LOANS

PUTTING INTO SAVINGSNEW CLOTHES

NEW TECHNOLOGY PRODUCTS

INVESTING IN SHARES OF STOCK/MUTUAL FUNDS

HOME IMPROVEMENTS/ DECORATING

RETIREMENT FUND

I HAVE NO SPARE CASHHOLIDAYS/VACATIONS

Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014


IS THIS A GOOD OR BAD TIME TO BUY?CANADA

EXCELLENT3%3%3%

5%4%

39%38%

37%39%

41%GOOD

39%41%42%

42%

44%

NOT GOOD

15%14%

13%13%

12%BAD

VIEWS ON FINANCES AND CLIMATE TO BUY STAY STATICWhat is holding Canadians back from loosening their pocketbooks?

Feelings about their finances and whether it’s a good time to buy aren’t

down – but they also aren’t improving.

Just about half of Canadians (51%) consider their finances to be good.

That has stayed the same for four consecutive quarters, but is down from

60% from the Q1 survey one year ago.

Likewise, when asked if it’s the right time to buy what they need and want,

considering their finances and costs, Canadians aren’t overly optimistic.

Over the past year, the percentage of people saying “yes” has gone down,

up, and now down again for two straight quarters. In Q1 2014, just over 4

in 10 (42%) agreed that this was a good or excellent time to buy.

Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014


JOB PROSPECTS SEEN AS FLATCanadian attitudes towards job prospects also have barely moved in a

year. 52% rate job prospects as good or excellent. In the previous four

Nielsen surveys, the numbers were 52%, 51% or 50%.

In the first quarter of the year, Canada’s unemployment rate was 7%,

7% and 6.9% in January, February and March. Though Canada did gain

190,000 jobs from the end of Q1 2013 to the end of Q1 2014, Statistics

Canada reports that overall employment growth has been subdued since

August 2013. Despite that, job security has actually dropped on the list

of top Canadian concerns.

HOW DO YOU RATE

JOB PROSPECTS?

CANADA Q1

2013

CANADA Q2

2013

CANADA Q3

2013

CANADA Q4

2013

CANADA Q1

2014

Excellent 4% 4% 4% 5% 5%

Good 46% 47% 46% 47% 47%

Not good 38% 34% 37% 35% 35%

Bad 5% 7% 7% 7% 7%


WHAT IS YOUR BIGGEST

CONCERN OVER THE NEXT

SIX MONTHS?

#1

CONCERN

#2

CONCERNTOTAL

Debt 16% 12% 28% (/)

The economy 14% 10% 24% (+4)

Increasing utility bills 8% 13% 21% (+2)

Health 12% 7% 19% (+1)

Job security 11% 8% 19% (-2)

Increasing food prices 6% 12% 18% (+1)

Work-life balance 9% 6% 15% (/)

DEBT IS STILL #1 WORRYWhile debt is still the top concern of Canadians, worries about the

economy in general showed the biggest increase.

This flies in the face of global outlooks, and indeed forecasts for Canada.

In April, the International Monetary Fund said the global economy is

strengthening, and increased its growth forecast for Canada. The IMF

suggested that Canada will benefit from a rebounding U.S. economy

through 2014. However, the IMF added that weaker than expected

exports, high household debt and high housing prices all pose economic

risks to Canada.

“The question on the minds of many consumers; Will the bubble burst?”

Here are the seven issues that Canadians are most worried about over

the next six months. The numbers in parentheses notes the percentage

change from the Q4 Nielsen survey.

“With consumer attitudes stuck in a holding pattern, fast-moving

consumer goods spending patterns in Canada continue to move

sideways,” says Allison. “That’s evident by nearly flat unit sales gains

of just 0.5% in the first quarter.”

CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q1 2014

ABOUT THE SURVEY The Nielsen Global Online Survey was conducted February 17 to March

4, 2014, and polled more than 30,000 consumers online in 60 countries

throughout Asia-Pacific, Europe, Latin America, the Middle East, Africa

and North America. 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%.

This Nielsen survey is based on the behavior of respondents with online

access only. Internet penetration rates vary by country. Nielsen uses a

minimum reporting standard of 60 percent Internet penetration or 10M

online population for survey inclusion. The China Consumer Confidence

Index is compiled from a separate mixed methodology survey among

3,500 respondents in China. The Nielsen Global Survey, which includes

the Global Consumer Confidence and Spending Intentions Survey, was

established in 2005.

ABOUT NIELSEN Nielsen Holdings N.V. (NYSE: NLSN) is a global information and

measurement company with leading market positions in marketing

and consumer information, television and other media measurement,

online intelligence and mobile measurement. Nielsen has a presence in

approximately 100 countries, with headquarters in New York, USA and

Diemen, the Netherlands.

For more information, visit www.nielsen.com.

Copyright © 2014 The Nielsen Company. All rights reserved. Nielsen and

the Nielsen logo are trademarks or registered trademarks of CZT/ACN

Trademarks, L.L.C. Other product and service names are trademarks or

registered trademarks of their respective companies. 14/7750

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CONSUMER CONFIDENC E - Nielsen · 2019. 5. 29. · CONSUMER CONFIDENCE A CANADIAN PERSPECTIVE 1 2014 C 2014 T N Company 1 CONSUMER CONFIDENC E A CANADIAN PERSPECTIVE ... categories-