CONSUMER CONFIDENC E - Nielsen · 4e trimestre 2013 3e trimestre 2013 2e trimestre 2013 1er trimestre 2013 ... quarter and took advantage of cross-border shopping in the U.S.,”

1CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q4 2013 Copyright © 2014 The Nielsen Company

CONSUMER CONFIDENCEA CANADIAN PERSPECTIVE Q4 2013

2 CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q4 2013

CONFIDENCE LEVELS BACK UP, AS CONSUMERS FEELING A LITTLE BETTER ABOUT JOBS AND SOME SPENDINGCanada is bucking a global trend, with consumer confidence up after two

consecutive quarters of declining optimism.

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.

Canada’s confidence level was up to 100 in the final quarter of 2013,

a three point jump. In the Nielsen survey, a score of 100 is considered

neutral. Levels above and below show degrees of optimism and

pessimism.

In contrast to the rising confidence in Canada, the global confidence

level stands at 94, the same as in Q3 and Q2. In the latest Nielsen

survey, only 26 of the 60 markets surveyed, including Canada, showed

an increase in confidence.

Canadians were more hopeful about their finances in the fourth quarter,

and entered 2014 on a positive note. “While consumer volatility remains,

lower unemployment and inflation levels contributed to the optimistic

sentiment among Canadians,” says Carman Allison, vice president,

Consumer Insights, Nielsen Canada.

NIELSEN CONSUMER CONFIDENCE INDEX

CANADA

GLOBAL

100

97

98

102

Q4 2013

Q3 2013

Q2 2013

Q1 2013

94

94

94

93

Q4 2013

Q3 2013

Q2 2013

Q1 2013


RECESSION FEARS WANEIn Q4, Canada showed a marked decrease in the number of people who

feel that the country is in recession – down five percentage points to 42%.

Consumer sentiment is one reason why the recovery from the recession

has been slow. In Canada and around the world, many people feel that

their country is still in recession, despite the official end more than four

years ago.

Globally, 57% of people say their country is still in recession, and in the

U.S. that number is 71%. After just about half of Canadian consumers

showed a recessionary mindset for most of the year, the drop in fear is

encouraging.

CANADA

47%

42%

47%

49%

4e trimestre 2013

3e trimestre 2013

2e trimestre 2013

1er trimestre 2013

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


JOB HOPES UP SLIGHTLYThe percentage of Canadians who rate job prospects as good or excellent

has been relatively static all year, though ended the year on an up note.

Should Canadians be bullish about job prospects? Jobs were up in

November, when the survey was conducted. However, in the last month

of 2013 employment unexpectedly fell by 46,000, and the unemployment

rate rose 0.3 percentage points to 7.2% according to Statistics Canada.

For 2013, employment gains were 102,000, or 0.6%. That was the

slowest 12-month growth rate since 2009. The year before, growth was

310,000 or 1.8%.

Outlooks for 2014 are unclear. A survey of over 1,900 employers across

Canada by the Manpower Group, for instance, showed that 13% plan

to add jobs in Q1 of 2014 (while 8% are expected to cut back). Several

forecasts say pay increases for 2014 are expected to only keep pace with

2013. It’s a reminder that the job and wage situation is still somewhat

volatile – the question is how that might affect consumer spending.

HOW DO YOU RATE

JOB PROSPECTS?

CANADA Q1

2013

CANADA Q2

2013

CANADA Q3

2013

CANADA Q4

2013

Excellent 4% 4% 4% 5%

Good 46% 47% 46% 47%

Not good 38% 34% 37% 35%

Bad 5% 7% 7% 7%


IS THIS A GOOD OR BAD TIME TO BUY?CANADA

EXCELLENT3%3%3%4%

39%38%39%

41%GOOD

39%41%42%

42%NOT GOOD

15%14%

13%

12%BAD

BIT BETTER TIME TO BUYAlthough the view of their finances is unchanged, Canadians are a little

more confident about spending. For the third consecutive quarter,

just about half of Canadians consider their finances to be good – 51%,

following 50% in Q3 and 51% in Q2 (all down from 60% in the first

consumer confidence of the year).

Even with that middling attitude, slightly more Canadians say it’s the

right time to buy what they need and want, considering their finances and

the costs of things. 43% now say it’s a good or excellent time, up by the

slimmest of margins from the 41% who said so in Q3 and the 42% in Q2.

Q1 2013 Q2 2013 Q3 2013 Q4 2013

“Canadians were more optimistic about their finances in the fourth

quarter and took advantage of cross-border shopping in the U.S.,”

says Allison. “In order to keep spending in Canada, many retailers

implemented U.S.-based promotions such as Black Friday and Cyber

Monday to jump start the holiday season, which translated to an

increase in overall retail sales of 3.5% compared to last year.”


SPENDING PREFERENCES CONTINUE TO BOUNCEIn their spending intentions, Canadians are giving some mixed signals.

Marginally more Canadians may be saying it’s a good time to buy, and

retail sales may be up. Yet in several spending areas, the trend line is

down.

What do Canadians do with their money after covering essential living

expenses? Looking at spending strategies, we see a drop in four of

the five categories. Overall, on both the spending and savings sides,

consumer strategies have been yo-yoing through all of 2013.


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% 35%

39%

11%

18%

19%

19%

15%

17%

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


FEWER CANADIANS LOOKING TO CUT BACKIn looking to manage their spending and saving, the number of

Canadians seeking ways to cut their household expenses has fallen.

In Q4, 55% said they’ve changed their shopping patterns compared to

this time last year, down from 59% in Q3.

Where are consumers looking to scrimp? Hanging onto their wardrobe

longer seems to be in fashion. As other strategies have dipped, spending

less on new clothes is now the number one savings strategy, up from

number three last quarter.

The biggest changes in areas where consumers are looking to rein in–

jumps in delaying purchases, like replacing major household items and

technology upgrades. In contrast, notably fewer Canadians are now

cutting back on take-away meals, out-of-home entertainment, car use,

and short holidays or annual vacations.

Nielsen inquires about 15 savings habits. Consumers are turning to six

of them more often and six less often than in Q3, and in three categories

there was no change (the percentage change from the Q3 survey is in

parentheses).

Spend less on new clothes: 54% (/)Try to save on gas and electricity: 51% (/)Cut down on take-away meals: 50% (-6)Cut down on out-of-home entertainment: 49% (-5)Switch to cheaper grocery brands: 48% (/)Delay upgrading technology (PC, mobile, etc.): 35% (+3)Delay replacing major household items: 33% (+6)Cut down on holidays/short breaks: 33% (-5)Use my car less often: 31% (-5)Cut down on telephone expenses: 28% (+1)Look for better deals on home loans, insurance, credit cards, etc.: 24% (+3)Cut down on at-home entertainment: 24% (-2)Cut out annual vacation: 24% (-5)Cut down on or buy cheaper brands of alcohol: 18% (+3)Cut down on smoking: 11% (+1)


DEBT IS CHIEF WORRY, AS CANADIANS OWE MORE THAN EVERDebt is still the top concern of Canadians, and for good reason.

In December 2013, Statistics Canada reported that household debt had

reached yet another all-time high – 163.7%, which means Canadians owe

nearly $1.64 for every $1 in disposable income.

If there was any good news, it’s that the debt-to-income ratio was up

only slightly from the previous quarter, and that the Bank of Canada

expects the indebtedness numbers to stabilize and then slowly reverse

in the years ahead.

While concerns about debt and job security rose slightly – and concerns

about the economy in general actually decreased – the biggest jump

in worries was seen around utility bills, as Canadians headed into the

winter months.

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 Q3 Nielsen survey.

As we wrap up 2013 and head into 2014, Canadians are feeling relatively

neutral. However, with the recent decline in the dollar, and faced with

one of the coldest winters in recent memory, the impact of rising utility

bills may have the consumer starting off the new year in a negative

mood.

WHAT IS YOUR BIGGEST

CONCERN OVER THE NEXT

SIX MONTHS?

#1

CONCERN

#2

CONCERNTOTAL

Debt 17% 11% 28% (+1)

Job security 12% 9% 21% (+1)

The economy 11% 9% 20% (-2)

Increasing utility bills 6% 13% 19% (+5)

Health 10% 8% 18% (-4)

Increasing food prices 5% 12% 17% (-1)

Work-life balance 9% 6% 15% (+1)

CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q4 2013

ABOUT THE SURVEY The Nielsen Global Online Survey was conducted November 11-29,

2013, 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. 14/7422


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CONSUMER CONFIDENC E - Nielsen · 4e trimestre 2013 3e trimestre 2013 2e trimestre 2013 1er trimestre 2013 ... quarter and took advantage of cross-border shopping in the U.S.,”