Ho Chi Minh City, 27 July 2012 – Consumer confidence levels across Asia have continued to decline in the second quarter of 2012, however, consumers in Asia remain more optimistic than many of their global counterparts, according to the latest quarterly Consumer Confidence Index findings from Nielsen, a leading global provider of information and insights into what consumers watch and buy.
Nielsen’s Q2 2012 Consumer Confidence Index recorded a score of 100 for Asia, down three points from Q1 2012. Confidence levels declined in many markets across Asia, with just five markets (Indonesia, Malaysia, Hong Kong, Vietnam and South Korea) recording an increase in confidence levels for the quarter. Malaysia posted the strongest gain in Asia, up four points compared to Q1 2012. Japan and South Korea recorded the lowest levels of confidence in Asia with scores of 57 and 50 respectively.
Despite weakening sentiment around the region, confidence levels in Asia continued to out-perform global averages, coming in nine points above the global consumer confidence score of 91. A number of Asia markets ranked amongst the most confident countries globally, including Indonesia (1st) which had the world’s most confident consumers, Philippines (3rd) and Malaysia (5th). At the other end of the spectrum, Asia’s least confident countries, Japan and South Korea, were also amongst the lowest globally, together with Croatia, Greece, Italy, Portugal and Hungary.
“Continuing economic uncertainty is clearly impacting on consumers’ confidence levels across the region,” said Therese Glennon, Nielsen’s Managing Director of Consumer Insights in the APMEA Region. “Consumer confidence has failed to gain any momentum this year as global events, including a worsening Euro zone crisis coupled with slowing growth rates in China and India, impacted financial markets and consumer sentiment in many parts of Asia. Consumers are reacting to renewed global market volatility by adopting a more cautious approach to discretionary spending.”
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.
Perceptions of job prospects, personal finances declined
According to Nielsen’s survey, 58 percent of Asian consumers felt their local job prospects in the next 12 months were good or excellent, down three percentage points from the previous quarter. In Vietnam, 46 percent of Vietnamese respondents say their job prospects over the next 12 months were good/excellent, decreasing 7 percentage points from the previous quarter and 11 percentage points versus a year ago. More than half (59%) of online consumers in Asia considered their personal finances over the next twelve months to be good or excellent, down four percentage points from Q1 2012 but increase two percentage points from Q2 2011. One in two Vietnamese respondents (51%) reported their state of personal finance good or excellent over the next 12 months, slightly increasing from 49 percent in Q1 2012 but still lower than a year ago (56%).
Top 5 Concerns of Vietnamese consumers in Q2 2012
The economy (19%)
Job security (18%)
Increasing utility bills (12%)
Increasing food prices (7%)
Consumers adopting a cautious approach to spending
According to Nielsen’s survey, asked how they intended to utilize their spare cash after covering their essential living expense, more than one third of Asian consumers (37%) said they would put their spare cash towards a holiday or vacation, down from Q1 2012 results (44%), and spending on items such as clothing (35%), technology products (30%) and out-of-home entertainment (34%) was lower in comparison to the previous quarter. While savings (66%) remains the top choice for Vietnamese to put spare cash in after covering essential living expenses; out of home entertainment (28%) and home improvement (27%) became less attractive versus Q1 2012. Discretionary spending such as holidays/vacations (32%), new technology products (29%), new clothes (28%) saw slight increases compared to the previous quarter.
Although discretionary spending appeared to have borne little impact from consumers’ economic concerns and weakening sentiment, Nielsen’s survey revealed that up to 86 percent of Vietnamese respondents have adjusted spending to save on household expenses compared to last year, mostly in gas and electricity (70%), out of home entertainment (63%), new clothes (63%), upgrading technology (53%) and telephone expenses (51%).
Whilst consumers in Asia are still out there shopping and enjoying entertainment outside of their homes, they are adopting a much more conservative approach, and are more conscious of the amount they are spending on such items during these uncertain times. More than ever, we expect consumers to seek out promotions to stretch their cash further,” notes Glennon.
About the Nielsen Global Survey
The Nielsen Global Survey of Consumer Confidence and Spending Intentions was conducted May 4-21, 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 was established in 2005.
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.
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