Insights

Consumer Confidence Declined Throughout Europe in Q4 2012
Article

Consumer Confidence Declined Throughout Europe in Q4 2012

Consumer confidence continued to wane in Europe in Q4 2012, as sentiment about personal finances, job prospects and immediate spending intentions all declined as regional economic and political outlooks deteriorated. Confidence fell in 20 of the 29 European markets measured in Q4 2012, and 10 posted confidence declines of six points or more from Q3, according to findings from the Nielsen Global Survey of Consumer Confidence and Spending Intentions. While five European markets posted increases, Norway was the only one in the region measured by Nielsen with a confidence reading above the 100 benchmark, reporting an index of 102.

Out of the 58 markets that Nielsen measures, eight of the 10 lowest consumer confidence scores hailed from Europe in Q4. Confidence in Greece declined 11 points to 35 and confidence remained unchanged in Hungary at 37, while the debt-burdened markets of Portugal (38), Italy (39), and Spain (46) experienced drops of three, seven and two points, respectively.

The Nielsen Global Survey of Consumer Confidence and Spending Intentions measures consumer confidence, major concerns and spending intentions among 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.

“The tentacles of the debt crisis reached beyond recession-gripped southern European nations and weakened confidence throughout much of the region,” said Dr. Venkatesh Bala, chief economist at The Cambridge Group, a part of Nielsen. “Recovery hopes dimmed last quarter as countries in central, northern and eastern Europe were dragged into recession. However, signs of stabilization are evident, and if they continue, may enhance confidence and lead to brighter macroeconomic prospects later this year.”

Belgium reported a 14-point confidence drop to 74 in Q4, the sharpest decline among European countries measured. Confidence dipped nine points in France and Switzerland to 52 and 95, respectively. The U.K. (+2), Germany (+1), Croatia (+1), Romania (+1), and Turkey (+1) were the only European markets to post confidence increases in Q4.

“Greece is battered by five years of recession, which has caused endless social unrest as citizens are tired of the continued turmoil and seemingly perpetual crisis,” said Matina-Martha Bada, sub-regional leader, Nielsen Data Acquisition South East Europe. “During November 2012, uncertainty regarding crucial bailout funds needed to rescue Greece from insolvency was coupled with a rise in unemployment and another round of austerity measures as economic turmoil and government spending continued to take their toll.”

“In Belgium, the drop in fourth quarter consumer confidence is a reflection of unemployment concerns as many companies are restructuring and downsizing,” said Jens Ohlig, managing director of Nielsen Benelux. “Optimism for local job prospects declined 14 points in Q4 to 19 percent and personal finances dropped three points to 45 percent, but the savings rate continues to be strong.”

“In France, the economic situation deteriorated in the fourth quarter as unemployment and purchasing power concerns continued to rise, coupled with a collective scepticism over effective political actions,” said Laurent Zeller, group managing director, Nielsen France. “A gloomy outlook for 2013 is ahead as consumers have started new and cautious behaviour, reducing spending on fast-moving consumer goods, which have traditionally remained robust, even in down times.”

“German consumers are not letting the European debt crisis get in the way of their desire to buy,” said Ingo Schier, managing director, Nielsen Germany. “This development is likely to continue in 2013 as the government has reduced income taxes and statutory pension contributions. Additionally, positive forecasts for the development of employment, wages and prices are expected.”

Other notable findings include:

  • North Americans were more optimistic about job prospects and recessionary conditions than in Q3
  • Consumer confidence in developing Asia-Pacific markets outperformed developed ones
  • Latin Americans were confident for the year ahead
  • Consumer confidence declined among Middle Easterners and Africans

For more detail and insight, download Nielsen’s Q4 2012 Global Consumer Confidence Report.

About the Nielsen Global Survey

The Nielsen Global Survey of Consumer Confidence and Spending Intentions was conducted Nov. 10-27, 2012 and polled more than 29,000 online consumers in 58 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 their Internet users, and 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 10 million 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.