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CONSUMER CONFIDENCE, CONCERNS AND SPENDING INTENTIONSAROUND THE WORLD
QUARTER 1, 2012
2 Copyright © 2012 The Nielsen Company.
Global consumer confidence increased five index points to 94 in Q1 2012, according to global consumer confidence findings from Nielsen, a leading global provider of information and insights into what consumers watch and buy.
In the latest round of the survey, conducted between February 10 and February 27, 2012, overall confidence rose in 68 percent of global markets measured, compared to Q4 2011 where confidence increased in 21 percent of global markets. Confidence in Q1 2012 increased in 38 out of 56 markets, fell in 16 markets and remained flat in two.
Confidence increased in 16 of 27 European markets
Discretionary spending and saving increased across all sectors reviewed
Concern for the economy remained a top worry among 19% of global respondents
China confidence increased 2 points to 110
Global consumer confidence increased five points to 94
U.S. consumer confidence index increased 9 points to 92
More than half of global respondents (57%) said they are in a recession, down from 64% in Q4 2011
OVERALL CONFIDENCE LEVELS ROSE IN 68% OF GLOBAL MARKETS MEASURED
Copyright © 2012 The Nielsen Company. 3
Index levels above and below 100 indicate degrees of optimism/pessimism
Source: Nielsen Global Survey of Consumer Confidence and Spending Intentions, Q1 2012
Nielsen Global Consumer Confidence Index—56 countries, three month trend
Q1 2012 vs. Q4 2011
No change
Increase
Decrease
+1123
INDIA
+6119
SAUDI ARABIA
+1118
INDONESIA
+1118
PHILIPPINES
+2110
CHINA
-2110
BRAZIL
+3107
THAILAND
+6107
MALAYSIA
0105
UNITED ARAB EMIRATES
+4103
HONGKONG
+6101
PERU+499
COLOMBIA
+199
NORWAY
+597
EGYPT
+296
SINGAPORE
+1196
CHILE
+695
DENMARK
-895
AUSTRALIA
-594
VIETNAM
-393
CANADA
+992
UNITED STATES
+291
PAKISTAN
+491
ARGENTINA
+191
NEW ZEALAND
+390
ISRAEL
+390
GERMANY+989
VENEZUELA
-587
SWITZERLAND
+ or - Change from Q4 2011
+594
GLOBAL AVERAGE
+487
TURKEY
+186
NETHERLANDS
-486
AUSTRIA
+1384
TAIWAN
084
RUSSIA
-781
SWEDEN
-180
MEXICO
+280
SOUTHAFRICA
+677
UNITEDKINGDOM
-373
FINLAND
+672
ESTONIA
+371
LATVIA
+170
LITHUANIA
-770
BELGIUM
+469
CZECH REPUBLIC
-466
UKRAINE
+464
IRELAND
-864
POLAND
+160
ROMANIA
+258
JAPAN
-353
SPAIN
-550
FRANCE
+349
SOUTHKOREA
-445
ITALY
+245
CROATIA
+339
PORTUGAL
-437
GREECE
*Survey is based on respondents with Internet access. Index levels above and below 100 indicate degrees of optimism/pessimism
Mid Tier Countries 100 to 90
Low Tier Countries 89 to 30 (more pessimism)
Top Tier Countries 101 and Higher (more optimism)
+232
HUNGARY
Conditions are improved, but still fragile“Households around the globe experienced a brighter personal situation in terms of jobs and personal finances last quarter, especially in the U.S. and in Asia, which was reflected in the improved consumer confidence and higher discretionary spending,” said Dr. Venkatesh Bala, chief economist at The Cambridge Group, a part of Nielsen. “While global economic conditions are more stable than in the depths of the European sovereign debt crisis late last year, underlying economic conditions are still fragile and fluid in many parts of the world, which could affect consumer confidence and spending momentum for the coming quarter.
The Nielsen Global Survey of Consumer Confidence and Spending Intentions, established in 2005, tracks consumer confidence, major concerns and spending intentions among more than 28,000 Internet consumers in 56 countries. Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism.
More than half of global respondents (57%) said they are in a recession, down from 64% in Q4 2011
4 Copyright © 2012 The Nielsen Company.
Source: Nielsen Global Survey of Consumer Confidence and Spending Intentions, Q1 2012
Discretionary spending and saving increased across all sectors
GLOBAL AVERAGE
How to utilize spare cash after covering essential living expenses
45
3232
46
Q2 2011
Q3 2011
Q4 2011
Q1 2012
48
Don’t know/
undecided
Putting into
savings
Out ofhome
entertainment
Newclothes
Holidays/vacations
New technology
products
Paying off debts/
credit cards/loans
Investing in shares of
stock/mutual funds
Home improvements/
decorating
Retirement fund
I have no spare cash
2829 29
3133
22 2222
32
28 2826
28 27
23
19 19 19 191817
22
1310
99
13
161615
233 2
3131 3134
50
Consistent good news outweighed the badIn Nielsen’s Q1 survey, while more than half (57%) of consumers around the world indicated they were in a recession, that sentiment was down from 64 percent in Q4 2011. Regionally, online respondents who believed they were in a recession showed declines in Asia-Pacific (44% compared to 53% in Q4), North America (80% compared to 86% in Q4) and Europe (72% compared to 74% in Q4), while a slightly growing number of online respondents in Latin America (48% compared to 47% in Q4) and Middle East/Africa (75% compared to 74% in Q4) believed they were in a recession.
More than half (55%) of online consumers surveyed described their personal finances for the next 12 months as excellent/good, up from 52 percent in Q4 2011, while one-third indicated it was a good time to buy the things wanted and needed. Local job prospects improved globally by six percentage points in Q1, yet less than half (48%) perceived the outlook for the upcoming year as favorable.
Intended discretionary spending and saving increased in Q1 across all sectors reviewed. Half of consumers around the world plan to put spare cash into savings, up from 48 percent in Q4 2011. Thirty four percent intend to buy new clothes, up from 31 percent the previous quarter and 33 percent expect to spend spare cash on holidays and vacations—a rise of seven percentage points from Q4 2011. Planned spending on technology also increased, with 28 percent of global online consumers intending a purchase, up from 22 percent in Q4.
“Improved confidence led to more discretionary spending from consumers around the world in the past quarter,” said Dr. Bala. “The survey evidence suggests that while consumers are neither as confident or comfortable with the economy as they would like it to be, they are expressing a pent-up demand to spend as they did prior to the recession. Such a desire for psychological release through the various forms of discretionary consumption reported in the Nielsen survey—all of which act as stress-relievers—is understandable after three years of relentless belt-tightening and uncertainty.”
Copyright © 2012 The Nielsen Company. 5
Economy and job security remained top concernsConsumer concern for the economy remained a top worry among one-in-five global respondents (19%)—up from 18 percent in Q4 2011. Job security (15%), work/life balance (10%), health (8%), and increasing food prices (7%) were other key concerns cited, which remained unchanged from the previous quarter results.
While job security fears abated some in North America, dropping four percentage points to 12 percent compared to Q4 2011, they rose two points in Latin America to 18 percent and one point in Middle East/Africa to 21 percent. Anxiety over the
economy increased four percentage points in Asia-Pacific to 22 percent and three points in Europe to 14 percent compared to the previous quarter.
In Europe, increasing utility bills (electricity, gas, heating, etc.) rose by one point to 10 percent and in North America, increasing fuel prices and food prices increased by three and two points, respectively. Work/life balance and political stability worries increased two and one point(s), respectively in the Middle East/Africa.
Source: Nielsen Global Survey of Consumer Confidence and Spending Intentions, Q1 2012
Top 5 concerns over the next 6 months
Percent concerned and (change vs. Q4 2011)
EUROPEECONOMY +4
JOB SECURITY +1
WORK/LIFE BALANCE -2
HEALTH N/C
INCREASING FOOD PRICES -1
22%
15%
13%
9%
9%
ECONOMY +3
JOB SECURITY -1
INCREASING UTILITY BILLS +1
HEALTH N/C
INCREASING FOOD PRICES N/C
14%
15%
10%
9%
5%
JOB SECURITY +2
ECONOMY N/C
HEALTH +1
WORK/LIFE BALANCE -2
CRIME N/C
18%
11%
8%
11%
9%
ASIA PACIFIC
ECONOMY N/C
JOB SECURITY +1
POLITICAL STABILITY +1
WORK/LIFE BALANCE +2
PARENTS’ WELFARE +1
21%
12%
11%
7%
6%
MIDDLEEAST/AFRICA ECONOMY -1
DEBT -2
JOB SECURITY -4
INCREASING FUEL PRICES +3
INCREASING FOOD PRICES +2
26%
13%
12%
8%
6%
NORTHAMERICA
LATINAMERICA
6 Copyright © 2012 The Nielsen Company.
Overall consumer confidence increased across the regionsOverall consumer confidence rose in all global regions, with North America posting the biggest regional gain, up eight index points to an index of 92. Asia-Pacific posted an index of 103, up four points, and Middle East/Africa rose two points to 97. Confidence in Europe rose one point to 72 and Latin America remained flat at 98 index points.
According to the latest survey, Asians were most optimistic about job prospects, Latin Americans were most confident about personal finances and North Americans were most positive about immediate spending intentions.
Source: Nielsen Global Survey of Consumer Confidence and Spending Intentions, Q1 2012
Overall consumer confidence increased across the regions
98 9898979199 10397
EUROPE
ASIA PACIFIC MIDDLEEAST/AFRICA
NORTHAMERICA GLOBALAVERAGE
LATINAMERICA
97959694
8172717471
84 9279
94898889
Q2 2011 Q3 2011 Q4 2011 Q1 2012
Copyright © 2012 The Nielsen Company. 7
A divergence of confidence/recovery is seen in some regions The biggest quarterly confidence gains last quarter came from Taiwan, Chile, the United States, Venezuela, United Kingdom, Estonia, Malaysia, Peru, Denmark and Saudi Arabia.
The biggest quarterly declines came from Poland, Australia, Belgium, Sweden, France, Switzerland, Vietnam, Ukraine, Greece, and Italy.
There is a divergence of confidence across global regions, as well as a divergence of recovery within some regions. The Eurozone, which had eight of the top 10 most pessimistic markets in Q1 fell back into recession as manufacturing contracted and unemployment reached a 15-year high, while in the Americas and Asia, manufacturing activity alongside domestic growth and recovery picked up steam.
Source: Nielsen Global Survey of Consumer Confidence and Spending Intentions, Q1 2012
Top 10 countries with biggest gains/declines vs. Q4 2011
13
G
AIN
S
D
ECLI
NESUNITED STATES
VENEZUELA
UNITED KINGDOM
ESTONIA
MALAYSIA
PERU
DENMARK
SAUDI ARABIA
POLAND
AUSTRALIA
BELGIUM
SWEDEN
FRANCE
SWITZERLAND
VIETNAM
UKRAINE
GREECE
ITALY
TAIWAN
1199666666
8
8
7
75
554
4
4
CHILE+ -
8 Copyright © 2012 The Nielsen Company.
Powerhouse economies showed growth In the U.S., consumer confidence rose nine points to 92, its highest level since before the recession, while China’s consumer confidence increased two points to 110, its highest rank since the inception of Nielsen’s index in 2005. And after three quarters of stagnation, Germany’s consumer confidence index climbed three points to 90.
“The jump in U.S. confidence is not entirely surprising given respectable job gains in the past quarter,” said James Russo, vice president, Global Consumer Insights, Nielsen. “However, this is not yet a rising tide raising all ships as the U.S. was dealt a below expectations March job report, followed by a spike in new unemployment claims in April. Furthermore, according to Nielsen’s analysis, consumer households earning over $100,000 continue to generate gains in consumer spending and shopping trips, while nearly 50 percent of Americans in the lower income brackets struggle. The near-term outlook for the American consumer will be heavily impacted by how the labor market behaves, especially for middle-class and lower income consumers.”
“Major economic indicators in China are still at reasonable levels, while the global economic condition is complicated,” said Yan Xuan, president, Nielsen Greater China. “The government’s firm support for small- and medium-sized enterprises through the expansion of credit, a policy shift to create domestic consumption and demand, and the continued enforcement of restrictions designed to deflate the real estate bubble are all contributing to the Chinese consumer optimism.”
“German consumers feel confident about their personal perspectives for the moment, especially with regard to their personal finances and buying intentions,” said Petra Kacnik, Director Consumer Research Germany, Austria & Switzerland. “Apart from the economy, the main concerns for German consumers include rising utility bills and fuel prices. Indeed, unemployment in Germany is low and expected to go down further. As a result, German consumers, at least for the short-term, plan to spend their spare cash on new clothes and on holidays and invest in quality of life purchases as the impact of the looming Euro crisis is top-of-mind.”
100
90
110
80
70
China U.S. Germany
Q1 Q3 2005
Q1 Q3 2006
Q1 Q3 2007
Q1 Q3 2008
Q1 Q2 Q3 Q4 2009
Q1 Q2 Q3 Q4 2010
Q1 Q2 Q3 Q4 2011
+2
+9
+3
Consumer confidence rises in United States, China and Germany
Source: Nielsen Global Survey of Consumer Confidence and Spending Intentions, Q1 2012
Copyright © 2012 The Nielsen Company. 9
Optimism fueled the outlook in Asia-Pacific, Middle East and Latin America India, despite an eight point index year-on-year decrease, remained the world’s most optimistic market for the ninth consecutive quarter with a one point quarterly consumer confidence increase to 123, followed by Saudi Arabia at 119, with Indonesia and the Philippines at 118 index points. High index levels were also reported in Brazil (110), Thailand and Malaysia (107 each), United Arab Emirates (105), Hong Kong (103) and Peru (101).
“India once again topped the global index indicating a high level of confidence amongst consumers, who are optimistic yet cautious,” said Justin Sargent, managing director, Nielsen India. “This optimism is reflected in Indian consumers’ increased confidence in job prospects, which is a good sign for the economy. However, job security is still a cause for concern and consumers are still cautious when it comes to spending spare cash. Similar to previous consecutive quarters, saving cash is still a priority for Indians. On the other hand, the personal digital revolution and experimentation by consumers who are now spoiled with affordable choices, is driving the increase in intention to spend on technology. Along with this, a growing affinity for branded apparel and organized retailing is likely to attract a growing proportion of discretionary spending despite economic volatility in the near term.”
While regional instability persists in Saudi Arabia, indications of a provisional, albeit timid, easing of the Euro crisis is alleviating immediate concern over global demand for oil,” said Arslan
Ashraf, managing director, Nielsen Saudi Arabia. “Despite the uncertainties, the Kingdom’s favorable demographics and a strong economy enhanced by the government’s generous stimulus package are driving a positive consumer outlook. With greater investments in skills development and a resurgent drive to increase employment among nationals, Saudis are feeling more confident about their job prospects. The overall sentiment is further strengthened by the near record high Saudi crude production reported earlier this year and substantial price increases.”
In Latin America, Chile and Venezuela showed quarterly consumer confidence increases of 11 and nine points, respectively. And Brazil, despite a two point quarterly decline to an index of 110, posted the strongest year-on-year confidence gain of 15 index points.
“Brazil’s consumer confidence remains at high levels, reflecting the optimism of the population, especially compared to other Latin American neighbors,” said Eduardo Ragasol, country manager, Nielsen Brazil. “Brazilians are confident in the economy and have a positive perception of their finances. However, consumers are now more concerned about paying off debts and loans acquired in the recent past. Brazilians will likely slow down their spending during the months ahead as the consumption in Brazil is changing and consumers are more careful about purchases, which is supported by Nielsen retail insights that show sales volume slowing down and sales value going up.
Source: Nielsen Global Survey of Consumer Confidence and Spending Intentions, Q1 2012
Top 11 consumer confidence countries
Asia-PacificMiddle East
Latin America
INDEX (change vs. Q4 2011)INDIA
SAUDI ARABIA
INDONESIA
PHILIPPINES
CHINA
BRAZIL
THAILAND
MALAYSIA
UNITED ARAB EMIRATES
HONG KONG
PERU
123 (+1)119 (+6)
105 (N/C)
118 (+1)
118 (+1)
110 (+2)
107 (+3)
107 (+6)
103 (+4)
110 (-2)
101 (+6)
10 Copyright © 2012 The Nielsen Company.
Recovery gap widened in Europe Confidence increased in 16 of 27 European markets as the economic and recovery gap widened between debt-ridden southern European nations and strengthening central and northern Europe. In addition to Germany’s three point quarterly increase to 90, Denmark (95) and the United Kingdom (77) posted quarterly confidence gains of six points each.
Hungary, despite a two point quarterly gain, remained the most pessimistic country at 32 index points, followed by Greece, where confidence fell to a low of 37 and Portugal at 39. Southern European nations of Italy, France and Spain fell to low confidence levels as the job outlook declined and personal finances and spending intentions remained restrained for the upcoming year. Steep quarterly declines were also reported in Poland (-8), and Belgium (-7).
“Greek consumer confidence has reached an all-time low, as Greek consumers remained pessimistic for the future of the Greek economy,” said Vicky Grigoriadou, client service director, Nielsen Greece. “The Greek fiscal crisis has been looming for some time, but there have been no signs of recovery. Consumers continue to doubt that Greece will manage to escape the recession any time soon and expectations for economic growth seem to have vanished.”
“In Italy, changes in the government and the consequent reforms are not yet generating positive effects on consumer expectations and 26 percent of Italians are still concerned about job security,” said Roberto Pedretti, managing director, Nielsen Italy. “Moreover, net income has been further penalized by additional local taxes shrinking the purchasing power of Italian families. While government actions focused on public debt and trust from global investors are positive signals for a recovery path, it is still not powered by clear political action.”
“The purchasing power in France is even weaker at the start of 2012 than it was last year, with both existing and new taxes increasing,” said Laurent Zeller, managing director, Nielsen France. “While food prices are in a stabilized rhythm, they are still on the rise and with high petrol prices, hypermarket, supermarket and discount store visits are impacted showing a year-over-year drop in sales volume of -1.5 percent in January.”
“Spain is showing record unemployment rates, which is expected to grow during the year creating uncertainty among the Spanish population,” said Jose-Luis Garcia Fuentes, managing director, Nielsen Spain. “Despite rising taxes and reduced disposable income, current fast-moving consumer goods trends do not show a decline as they cover basic needs.”
Source: Nielsen Global Survey of Consumer Confidence and Spending Intentions, Q1 2012
Divided Europe – Improving north and struggling south
Asia-Pacific
INDEX (change vs. Q4 2011)
INDIASAUDI ARABIA
INDONESIA
PHILIPPINES
BRAZIL
THAILAND
MALAYSIA
UNITED ARAB EMIRATES
HONG KONG
PERU
123 (+1)119 (+6)
118 (+1)
118 (+1)
110 (-2)
NORTHERNEUROPE
NETHERLANDS
SWEDEN
UNITED KINGDOM
FINLAND
ESTONIA
LATVIA
LITHUANIA
BELGIUM
IRELAND
NORWAY DENMARK
86 (+1)
81 (-7)
77 (+6)
73 (-3)
72 (+6)
71 (+3)
70 (+1)
70 (-7)
64 (+4)
99 (+1) 95 (+6)
SOUTHERNEUROPE
GREECE
PORTUGAL
ITALY
CROATIA
SPAIN
ROMANIA
37 (-3)
39 (+3)
45 (-4)
45 (+2)
53 (-2)
60 (+1)
Copyright © 2012 The Nielsen Company. 11
For more information visit www.nielsen.com
Country abbreviations: Argentina ARAustralia AUAustria ATBelgium BEBrazil BRCanada CAChina CNChile CLColombia COCroatia HRCzech Republic CZDenmark DKEgypt EGEstonia EEFinland FIFrance FRGermany DEGreece GRHong Kong HKHungary HUIndia INIndonesia IDIreland IE
Israel ILItaly IT Japan JPLatvia LVLithuania LTMalaysia MYMexico MXNetherlands NLNew Zealand NZNorway NOPakistan PKPeru PEPhilippines PHPoland PLPortugal PTRomania RORussia RUSaudi Arabia SASingapore SGSouth Africa SASouth Korea KOSpain ESSweden SE
About the Nielsen Global Survey
The Nielsen Global Survey of Consumer Confidence and Spending Intentions was conducted between February 10 and February 27, 2012 and polled more than 28,000 online consumers in 56 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 Nielsen Global Survey, which includes the Global Consumer Confidence Index, 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, mobile measurement, trade shows and related properties. 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.
Switzerland CHTaiwan TWThailand THTurkey TRUnited Arab Emirates AEGreat Britain GBUkraine UAUnited States USVenezuela VEVietnam VN
Region abbreviations:AP Asia-PacificEU EuropeLA Latin AmericaMEAP Middle East, Africa, PakistanNA North America
Copyright © 2012 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. 12/4934