Hong Kong’s consumer confidence index dropped one point in Q4 to 105 –an increase of twenty points from Q4 2012, according to survey findings from Nielsen, a leading global provider of information and insights into what consumers watch and buy.
Hong Kong’s consumer confidence score is more than 11 points higher than the global average of 94. Within the region, Hong Kong tops Singapore (97) and Taiwan (73), but trails behind China (111).
“Throughout 2013, consumers in Hong Kong remained cautiously optimistic in the economy, contributed by a number of positive factors such as steady unemployment and inflation rate,” said Eva Leung, Managing Director, Nielsen Hong Kong and Macau. “While a bright outlook can be seen in 2014, there are uncertainty on external environment and the sustainability of strong mainland tourist numbers.”
Drivers of Consumer Confidence
Hong Kong consumers reported a better outlook for job prospects, up to 57 percent from 53 percent, while having a stable outlook on personal finance. However, the outlook on whether it’s a good time to buy declined, from 55 percent to 50 percent.
Cash-Strapped Consumers Show Spending on Holidays Restraint
Putting spare cash into savings after essential expenses is still the favorite for most Hong Kong consumers: 71 percent in this quarter, up 3 percentage points in a year. But holiday and vacation spending intentions plummeted. Less than one-third (28%) of respondents would prefer to spend on vacations –an 11-percentage-point drop since Q4 2012.
“The persistent weakness of Hong Kong dollar, together with the lingering Philippines issue and Black Outbound Travel Alert to Bangkok impacted local consumers to take overseas vacation. They would rather their money in their wallets or spend on somewhere else,” said Leung.
However, more Hong Kong consumers are happy to spend on out-of-home entertainment, as intentions increased from 32 percent to 39 percent, year-over-year.
What are consumers concerned about?
Hong Kong consumers’ concerns over the economy continue to be the top of the list (14%), but with a 4-percentage-point decrease compared to Q3. Respondents were also getting more cautious about food prices (13%) and health issues (13%).
“The rise of health issues was partly caused by the recent H7N9 issues and the raising infections numbers.” Leung said. “While Hong Kong consumers were optimistic about their finances in the fourth quarter, a potential rise in food prices as a result of inflation levels is still uncertain for most of the consumers.”
About the Nielsen Global Survey
The Nielsen Global Survey of Consumer Confidence and Spending Intentions, established in 2005, measures consumer confidence, major concerns and spending intentions among more than 30,000 respondents with Internet access in 60 countries. The latest round of the survey was conducted November 11-29, 2013. Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism. Sample size for Hong Kong Consumer Confidence Index is 503, compiling from a mixed methodology survey.
The sample has quotas based on age and sex for each country based on their Internet users, 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.
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.