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INDONESIA IS IN THE TOP 3 MARKETS WITH THE MOST POSITIVE FINANCIAL SENTIMENT
57 Percent of Indonesian Consumers Spend More on Technology & Communication
Jakarta, 8 March, 2019 – Around the world consumers are displaying a strengthening sense of optimism about their financial wellbeing, particularly in developing markets throughout Asia Pacific, Africa, Middle East and Latin America, according to a new study by global measurement company, Nielsen.
Nielsen’s Changing Consumer Prosperity study, which tracks consumers’ sentiment toward their financial position and willingness to spend, found that 58% of consumers globally believe they are financially better off than they were five years ago. Asia Pacific consumers are the most positive about their financial situation, with 70% feeling more optimistic than five years ago, followed by Africa and the Middle East (52%) and Latin America (49%). Consumers in developed markets are less optimistic. Fewer than half of consumers in North America (46%) believe their financial standing has improved over the past five years, and just over one third of consumers in Europe (37%) feel financially better off than they did five years ago.
Asia Pacific constitutes seven of the top 10 markets with the most positive financial sentiment, with Colombia, Romania and Pakistan rounding out the top 10. Vietnamese consumers were the most positive about their financial situation with 86 percent feeling more optimistic than five years ago, followed by China with 81 percent and in the third is Indonesian consumers with 75 percent said they were more optimistic about their financial condition compared to five years ago . See Chart 1
This Nielsen report reveals that globally 44% of consumers are spending more on groceries over the last five years. Africa and Middle East is leading with half (50%) of consumers spending more on groceries, followed by Latin America (47%), Asia Pacific (46%), Europe (39%) and North America (33%). Other categories that are attracting increased consumer spending globally are tech communication, education, travel and health care. See chart 2
Otherwise, for Indonesian consumers, the results of the Changing Consumer Prosperity study show that more than half (57%) consumers spend more on technology and communication over the last five years. Indonesian consumers also spend more for Education (50%), Groceries (46%), Video / Music / Internet Services (43%) and Travel (36%) in the last five years.
Despite the strengthening in consumers’ sentiment around their finances, many are feeling the pressure of rising living costs. Globally, only 15% of consumers feel they are able to spend freely. But the good news is that this number is different from Indonesian consumers because there are still around 19 percent of Indonesian consumers said they are able to spend freely.
“This study recorded that many consumers are feeling more financially stable than they did in the past, and for Indonesian consumers, finding from The Conference Board® Global Consumer Confidence™ Survey in collaboration with Nielsen in Q4 2018 showed that consumer’s confidence to spend increased,” observes Agus Nurudin, Managing Director, Nielsen Indonesia. “The retail landscape is definitely undergoing a shift in many markets as consumers are adapting their spends on the basis of personal priorities and price points. Brand owners also need to adapt their business in order to be able to continue tapping opportunities to grow.”
Chart 1: Consumer sentiment to financial situation vs income growth (top ten markets)
Chart 2: Increased Consumer Spending - Top Five Categories
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ABOUT THE NIELSEN CHANGING CONSUMER PROSPERITY
The Nielsen Changing Consumer Prosperity report presents consumers’ sentiment towards their financial situations, their purchasing behaviour and impact on spending over time. It reveals consumer spending dynamics by regions covering 64 markets, including the top categories consumers are spending more on, along with top categories where consumers are willing to pay a premium. The insights will assist retailers and manufacturers in understanding consumer attitude in future spending and positioning products based on the opportunities that lie in premium and value segments in FMCG.
ABOUT THE NIELSEN GLOBAL SURVEY
The Global Survey is an Internet survey that takes about 30 minutes to complete. The sample is sourced from external sample providers. 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. These quotas are reviewed at a country level by Data Science. 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% Internet penetration or 10 million online population for survey inclusion.
Nielsen Holdings plc (NYSE: NLSN) is a global measurement and data analytics company that provides the most complete and trusted view available of consumers and markets worldwide. Our approach marries proprietary Nielsen data with other data sources to help clients around the world understand what’s happening now, what’s happening next, and how to best act on this knowledge. For more than 90 years Nielsen has provided data and analytics based on scientific rigor and innovation, continually developing new ways to answer the most important questions facing the media, advertising, retail and fast-moving consumer goods industries. An S&P 500 company, Nielsen has operations in over 100 countries, covering more than 90% of the world’s population. For more information, visit www.nielsen.com.