SINGAPORE, 23 JULY 2013 – With Southeast Asian markets continuing to display economic resilience and ongoing growth, consumers across the region remain optimistic, and a large proportion are focusing on saving for the future, according to the latest Consumer Confidence Index released today by Nielsen, a global information and measurement company.
According to the Nielsen Global Survey of Consumer Confidence and Spending Intentions, Indonesia reported the highest index of 124 in Q2 2013 (up two points on the previous quarter and 30 points above the global average of 94), followed by the Philippines which recorded a three point increase to 121. Thailand and Malaysia also featured amongst the most confident nations despite recording slight declines. Confidence in Thailand fell by one point to 114 in Q2 2013 compared to the previous quarter, while Malaysia recorded a four point decline to 103. Confidence in Vietnam (95) and Singapore (95) remained stable in the second quarter, and was on par with the global benchmark. (See Chart 1).
The Nielsen Global Survey of Consumer Confidence and Spending Intentions, established in 2005, measures consumer confidence, major concerns, and spending intentions amongst more than 29,000 respondents with Internet access in 58 countries. Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism.
“Overall, Southeast Asian consumers are feeling optimistic about the economic outlook compared to the rest of the world,” said Vishal Bali, Managing Director of Nielsen’s Consumer Insights business in Southeast Asia, North Asia and Pacific. “Minimum wages are increasing, as are foreign investments, and a growing numbers of consumers are entering the middle class, and this is no doubt fuelling the positive outlook we are observing.”
Across most of Southeast Asia, consumer perception of personal finances for the year ahead has remained relatively stable over the past four quarters. Indonesians have the region’s most optimistic view on their financial position with 84 percent saying their personal finances were good/excellent – the highest for Q2 2013 amongst countries covered in the Nielsen survey and 30 points above the global benchmark of 54; followed by the Philippines (79%), Thailand (69%) and Malaysia (63%).
Displaying signs of concern about their future financial security, one in two Singaporeans (50%) and Vietnamese (48%) had a positive financial outlook – down four points and six points respectively compared to Q1 2013, taking their score below the global average. (See Chart 2).
Southeast Asian consumers are amongst the world’s biggest savers, particularly in Indonesia where more than seven in 10 (71%) consumers are saving their spare cash (24 points above the global average of 47 percent), followed by the Philippines (70%), Vietnam (68%), Thailand (63%), Malaysia (61%) and Singapore (60%).
A further one third (33%) of Indonesians and around a quarter (24%) of Singaporean and Thai consumers utilise their spare cash to invest in shares and mutual funds compared to just 19 percent globally – a further indication that Southeast Asian consumers are planning for the future. Almost one in four (23%) Malaysians and Thais allocate spare funds into building their retirement fund – more than double the global average of 11 percent.
“These latest findings indicate Southeast Asian consumers are thinking about and planning for the future,” notes Bali. “With more disposable income than ever before, consumers across Southeast Asia have the opportunity to consider investing their money and bolstering their savings accounts while protecting themselves against future fluctuations in the global economy and other external factors.”
As current consumer confidence levels remain strong, many consumers across the region are spending up on holidays and travel, with Singapore (47%), Malaysia (up 4 points to 43%), Thailand (41%) and Vietnam (36%) well ahead of the global benchmark of 33 percent when it comes to spending their spare cash on holidays.
New technology also holds strong appeal for consumers in Southeast Asia. Around a third of Thai (34%), Vietnamese (32%), Indonesian (31%) and Filipino (31%) consumers are spending their spare cash on new technology products compared to the global average of just 25 percent. (See Chart 3).
Across the six markets, more than three in five consumers have changed their spending to save on household expenses over the past year. The three key areas where consumers have made a conscious effort to reduce spending include: new clothes, out-of-home entertainment, and their gas and electricity usage.
Bali concluded: “As the middle class population across Southeast Asia continues to grow at a rapid pace, consumer spending in these markets is reflecting their new found wealth. How they choose to spend their cash, however, will be underpinned by an air of caution, as financial security continues to be a high priority.”
The Nielsen Global Survey of Consumer Confidence and Spending Intentions was conducted between May 13–31, 2013, and polled more than 29,000 online consumers in 58 countries throughout Asia-Pacific, Europe, Latin America, the Middle East, Africa, and North America, including 3,000 consumers in the six Southeast Asia countries of Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam. 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 behaviour 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. The Nielsen Global Survey, which includes the Global Consumer Confidence Index, was established in 2005.
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.
Deanie Sultana, +61 431 483 176, deanie.sultana@nielsen.com