Global consumer confidence started 2015 with an index score of 97—an increase of one point from fourth-quarter 2014 and from a year-ago, according to the Nielsen Global Survey of Consumer Confidence and Spending Intentions. The Nielsen consumer confidence index measures perceptions of local job prospects, personal finances and immediate spending intentions, among more than 30,000 respondents with Internet access in 60 countries. Big index increases were reported in Taiwan, where confidence rose 11 points to 88—the highest score since 2011.
“Taiwan showed a strong rebound at the start of this year after a decline in the fourth quarter of 2014,” said Andy Huang, the managing director, Nielsen Taiwan. “The rise in confidence sentiment was driven by a strong improvement in the outlook for jobs, which increased 16 percentage points from the fourth quarter of 2014. Perceptions of personal finance and the willingness to spend also improved 9 and 10 percentage points respectively. Preliminary GDP forecasts, a falling unemployment rate and a stabilizing consumer price index, were other positive indicators at the start of 2015; they seem to have contributed to the increased optimism among Taiwanese consumers.”
The increasing confidence of Taiwanese consumers also reflects the biggest/second biggest concern over the next six months: The biggest concern remains the economy situation (30%), though it drops 10 percentage points from last quarter; worries over job security also decreases to 18% from 22%; and the concern over increasing food prices also declines from 20% to 16%. However, the second biggest concern over work and life balance, increases from 24% to 27%, and remains its position of ranking. This affects the way how Taiwanese consumers utilize their spare cash after paying all essential living expenses. Both holidays / vacations (30%) and out-of-home entertainment (34%) increase 7 and 8 percentage points respectively, since consumers are now looking for activities to accomplish the balance between work and life.
The majority of online respondents in Taiwan consider the place in an economic recession; however, said percentage reached a new low of 70% in the previous quarter, which was a drop from 82% since the second quarter of 2012. Nonetheless, putting into savings (69%) and investing in shares of stock/mutual funds (36%) were still top 2 options when Taiwanese consumers were asked the ways of utilizing their spare cash. “Taiwanese consumers are showing signs of ‘cautious optimism’,” said Huang.
"While confidence across global regions remained relatively stable in the first quarter, there is considerable variation across different markets,” said Louise Keely, senior vice president, Nielsen, and president, The Demand Institute. “In the first quarter of this year, the key emerging markets of Brazil and Russia saw large declines in confidence for the second consecutive quarter, with the drop in oil prices and the political instability in Brazil. China dropped another index point at the start of this year, which comes after a four-point decline in the previous quarter, reflecting the recent slowdown in GDP there.”
“In Europe, there are signs of improved consumer confidence in many countries, which reflects signs of growth in these markets,” continued Keely. “Lower oil prices have helped European consumers who are not in oil-producing countries, and labor markets are improving. On the other hand, the falling Euro against the dollar is good for export industries but not for consumers, who will pay more for imports.”
GOOD NEWS AND BAD NEWS
The good news is that, compared to the end of last year when all regional confidence scores declined, it was a more upbeat start to the year; as confidence increased slightly or remained stable in every region except Latin America. Consumer confidence remained steady in North America (106) and increased one point in Asia-Pacific, posting the highest quarterly regional index score of 107. Confidence in the Middle East/Africa (96) and Europe (77) edged up one point in the first quarter, but decreased two points in Latin America (86)—the region’s lowest score since 2011.
Among the world’s largest economies, consumer confidence increased most in Japan, rising nine points to 82 in the first quarter, which was the country’s highest score since 2005—the start of Nielsen’s consumer confidence index measurement. Germany also reached a milestone: Sentiment increased two points to reach the baseline score of 100. Confidence also increased one point in the U.S. (107), three points in the U.K. (97) and three points in France (60). Conversely, confidence in China decreased one point to 106 from fourth-quarter 2014.
SPENDING LESS, SAVING MORE IN Q1 2015
Global discretionary spending intentions declined or remained steady in the first quarter across all lifestyle categories measured. About three-in-10 global respondents (32%) planned to spend on holidays/vacations, new clothes (31%) and out-of-home entertainment (28%), quarterly declines of two, three and two percentage points, respectively. Spending intentions for paying credit cards and debts (25%) and new technology products (24%) held steady from the previous quarter.
Global saving intentions, on the other hand, showed a slight increase of one percentage point each for investing in stocks and mutual funds (22%) and one percentage point for retirement savings (11%) from fourth-quarter 2014. About half of global respondents planned to bank their spare cash (48%), no change from the previous quarter, while 14% said they had no spare cash, up from 13% the previous quarter. Almost one-quarter of those aged 55+ said they had no spare cash (22%)—the highest percentage of any age group. A promising sign for the future, however, is that more than half of respondents in the 21-34 age range (53%) said they were saving their money.
ABOUT THE GLOBAL SURVEY OF CONSUMER CONFIDENCE AND SPENDING INTENTIONS
The Nielsen Global Survey of Consumer Confidence and Spending Intentions was conducted Feb. 23 - March 13, 2015 and polled more than 30,000 online consumers 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 its Internet users and is weighted to be representative of Internet consumers. It has a margin of error of ±0.6%. This Nielsen survey is based only on the behavior of respondents with online access. Internet penetration rates vary by country. Nielsen uses a minimum reporting standard of 60% Internet penetration or an online population of 10 million for survey inclusion. The China Consumer Confidence Index is compiled from a separate mixed methodology survey among 3,500 respondents in China. The sub-Saharan African countries in this study are compiled from a separate mobile methodology survey among 1,600 respondents in Ghana, Kenya and Nigeria. The Nielsen Global Survey, which includes the Global Consumer Confidence Index, was established in 2005.
Nielsen N.V. (NYSE: NLSN) is a global performance management company that provides a comprehensive understanding of what consumers Watch and Buy. Nielsen’s Watch segment provides media and advertising clients with Total Audience measurement services across all devices where content — video, audio and text — is consumed. The Buy segment offers consumer packaged goods manufacturers and retailers the industry’s only global view of retail performance measurement. By integrating information from its Watch and Buy segments and other data sources, Nielsen provides its clients with both world-class measurement as well as analytics that help improve performance. Nielsen, an S&P 500 company, has operations in over 100 countries that cover more than 90 percent of the world’s population. For more information, visit www.nielsen.com.