Discretionary spending drops marginally for the quarter
Consumer confidence in urban India dropped by two points to an index score of 126 in Q3 2014. India continues to lead the global index in this quarter (128 in Q2 2014) of the 60 markets polled. Indonesia follows at second place with an index of 125 and Philippines (115). These are consumer confidence findings from Nielsen, a leading global provider of information and insights into what consumers watch and buy.
In the latest online survey, conducted Aug. 13–Sept. 5, 2014, over four in five (82%) urban Indian respondents indicated the highest levels of optimism globally on job prospects in the next 12 months, followed by Indonesia (80%) and China (74%).
“In India, overall, the confidence index continues to hold near its previous levels with the euphoria around the recently elected government settling down,” said Piyush Mathur, president, Nielsen India Region. “The consumer in India is in the middle of a festival season, and so spending will likely be higher than previous quarters due to gifting and entertaining. Besides traditional offline retailers, e-commerce is gaining traction for the urban affluent shoppers in India and online retailers have been spurring the market with discounts to fuel this movement. The actual impact of this on consumer spending might be more evident towards the end of the year.”
The Nielsen Global Survey of Consumer Confidence and Spending Intentions, established in 2005, measures perceptions of local job prospects, personal finances and immediate spending intentions among more than 30,000 respondents with Internet access [Refer Note 1] in 60 countries. Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism, respectively. The latest results reflect an outlook of cautious optimism, as every region’s consumer confidence score improved compared to the previous quarter.
Discretionary Spending & Savings
Nearly three in five (59%) online respondents polled indicated this is a good time to buy things they want and need, a one percent drop from last quarter (60%).
When it comes to investing spare cash, three in five (61%) urban respondents in India will put it into savings, while 44% of those polled are looking to invest in new technology. Nearly a third (28%) indicated they would invest in a retirement fund, while over a third preferred mutual funds (32%).
78% respondents have changed their spending habits to save on expenses, a three point increase from last quarter (75% in Q2 2014). The top three avenues for saving are spending less on gas and electricity (49%), new clothes (43%) and cutting down on telephone expenses (38%) and holidays and vacations (37%).
Personal Finances, Concerns
Seventy –six percent indicated that the state of personal finances was good or excellent in the third quarter 2014, at the same level as in quarter 1 (76%).The top concerns continue to be job security (21%), and the state of the economy (11%).
About the Nielsen Global Survey
The Nielsen Global Survey of Consumer Confidence and Spending Intentions was conducted Aug. 13–Sept. 5, 2014 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 (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.
[Note 1] While an online survey methodology allows for tremendous scale and global reach, it provides a perspective on the habits of existing Internet users, not total populations. In developing markets where online penetration has not reached majority potential, audiences may be younger and more affluent than the general population of that country. Additionally, survey responses are based on claimed behavior, rather than actual metered data.