indonesia started 2020 with the 4th highest consumer confidence index globally

  • Health and Economy continue to be major concerns among Indonesian consumers.
  • Indonesia consumers significantly reduce spending spare cash.

Jakarta, 27 May 2020 In the first quarter of 2020, Indonesia remained the 4th most confident market globally with a Consumer Confidence Index of 127 after India, Pakistan and The Philippines with the index of 140, 129 and 128 respectively; according to the latest The Conference Board® Global Consumer Confidence™ Survey in collaboration with Nielsen, a global measurement company. 

In the first quarter of 2020, The Global Consumer Confidence Index decreased slightly to 106 from a historic high of 107 (a reading above 100 is considered positive). indicating there were slightly more optimistic consumers than pessimistic ones globally. As the survey was conducted in the first half of February, the Index does not reflect the global spread of the virus in March. 

Compared to the last quarter of 2019, in Q1 2020 Indonesia Consumer Confidence increased 4 points, from 123 to 127. Consumer optimism about Job Prospects slightly decreased (-2 percentage points) from 72 to 70, while optimism about Personal Finances slightly increased (+1 percentage points) from 77 to 78, and Spending Intentions remained stable with 60.

Concern of Health Increased Significantly 

Even though the spread of COVID-19 virus was not even globally, consumers seemed to have begun to see it as a health crisis. Therefore, in many markets including Indonesia, the concern of Health increased. In Q1 2020 23% of consumers stated that they are concerned about Health, increased significantly from 14% in the fourth quarter last year.  Concern about The Economy remains the highest, however it only increased very slightly, from 34% to 35%.

“When the survey was conducted, COVID-19 had not affected Indonesian consumers’ optimism, even though it was not yet announced as pandemic by WHO, but it had already affected consumers’ concern on Health,”said Indrasena (Dede) Patmawidjaja, Managing Director of Nielsen Connect Indonesia. “Consumers, especially from Upper SES, kept abreast of foreign news, therefore they were aware about the spread of the virus in China and that triggered the concern.” 

Besides the concerns on Health and The Economy, 21 percent of Indonesian consumers expressed their concerns about the Work/Life Balance, and 11% of consumers said that they are concerned about Global Warming.   Furthermore, 11% consumers were concerned about  the Increasing Utility Bills (gas, electricity, etc), whereby this concern had just emerged to the Top 5 in Q1 2020.

Indonesians Tended to Reduce Spending On Holidays and Investment 

The survey also found that in the first quarter of 2020 Indonesia consumers significantly reduced spending their spare cash for Investing in Shares of Stocks / Mutual Funds (34%), decreased 12 percent  compared to previous quarter that was 46%. Besides Investment, the other item that was significantly reduces was Holidays, which was down 6 percent from 42% in Q4 2019 to 36%. 

With regards to the FMCG growth, Dede added, “Consumer confidence will in turn affect spending on consumer products. Our data shows that in Q1 2020, FMCG still grew very positively, however, there are some indications that categories such as Personal Care and Beauty, Ready To Drink and Indulgence will face some challenges in Q2 2020.”

Ending his explanation, Dede concluded, “Strong awareness, accessible price and relevant benefit are the key drivers for successful performance in the following quarters.”

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ABOUT THE CONFERENCE BOARD® GLOBAL CONSUMER CONFIDENCE SURVEY

The Conference Board® Global Consumer Confidence Survey is conducted in collaboration with Nielsen. It was conducted in February 2020 and polled more than 31,000 online consumers in 63 countries throughout Asia-Pacific, Europe, Latin America, the Middle East/Africa and North America. The survey closed well before the World Health Organization declared the COVID-19 outbreak a global pandemic on March 11. Unfortunately due to the COVID-19 outbreak in China, it was not possible to include China in the index for 2020 Q1. The sample includes internet users who agreed to participate in this survey and has quotas based on age and sex for each country. It is weighted to be representative of internet consumers by country. Because the sample is based on those who agreed to participate, no estimates of theoretical sampling error can be calculated. However, a probability sample of equivalent size would have a margin of error of ±0.6% at the global level. This survey is based only on the behavior of respondents with online access. Internet penetration rates vary by country.

The Conference Board uses a minimum reporting standard of 60% internet penetration or an online population of 10 million for survey inclusion. The Nielsen China Consumer Confidence Index is sourced from a separate survey conducted by Nielsen China, which is based on a mixed methodology survey of more than 3,000 respondents in China. The Global Consumer Confidence Survey was established in 2005. The Global Consumer Confidence Index Highlights, full report and technical notes to this series are available on The Conference Board website.

ABOUT THE CONFERENCE BOARD

The Conference Board is the member-driven think tank that delivers trusted insights for what’s ahead. Founded in 1916, the Conference Board is a non-partisan, not-for-profit entity holding 501(c) (3) tax-exempt status in the US. http://www.conferenceboard.org.For more detailed information, please download the report HERE

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