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25 January 2006
Hong Kong
‘Tis’ the Season to be Jolly’—this is especially so for more than a third of Hong Kong people whose favourite holiday is Chinese New Year (CNY). In a recent survey conducted by ACNielsen in Hong Kong, the world’s leading provider of consumer and marketplace information, Hong Kong consumers’ spending desire has lingered from last year with one-fifth planning to spend more in the upcoming CNY than they did in the previous year. Intended spending on overseas travel is likely to surge by 50 percent compared with last year.
Conducted in December 12-16, the survey interviewed 1,027 individuals aged 15 -54 in Hong
Kong by telephone.
“The improving job market in the past few quarters has reinforced consumers’ confidence both in their own job security as well as the state of their personal finances,” said Ms Amy Lee, Director, Customized Research, ACNielsen Hong Kong. “Hong Kong people are more willing to put their hands in the pocket now.”
The positive consumer sentiment very much dovetails the momentum shown in another ACNielsen survey in late 20051 where 76 percent of consumers in Hong Kong were optimistic about the job market in the next 12 months, 56 percent perceive the state of their personal finances to be good this year and similarly half feel that it is now time to spend on things that they wanted and needed.
Another major clue of improving consumer sentiment is the fact that there appear to be less cash-strapped consumers who claim they do not have any spare cash (6% in November 05 vs. 10% in May 05).
Besides saving for a rainy day, consumers are now more willing to spend on non-essentials like out of Home Entertainment (43%), New Clothes (39%) and Holidays/Vacations (31%). In addition, some have even become more willing to try their hand on the stock market (26%) and invest in retirement funds (10%). (Table 1)
While one fifth of consumers plan to spend more for the upcoming CNY than they did last year, and of those who intend to be more generous, 18 percent claimed to spend 30-40 percent more (Table 2), the biggest increase lies in those who planned to travel during CNY. Among the 17 percent of people who had plans to travel, their intended spending surged by 50 percent from $4,998 in 2005 to $7,506 in 2006. Higher income households planning to travel are going to spend as much as $9,559, representing a 76-percent jump from last year. (Table 3)
“People’s spending appetite has continued from the Christmas period into CNY, one of the most important traditional festivals in the Chinese community.” Ms Lee added. “This strong appetite to spend is mostly driven by the higher income households but is also reflected across other income groups.”
For kids and singles who are concerned about the value of red-packets amidst the overall positive spending desire, like it or not $20 remains the magic amount for each red packet as indicated by households across all income levels. It’s worth-noting that this time round, nine percent of families with household incomes from 12,000 to 17,999 indicate they will give more than they did last year, a four point increase on 2005. In fact, people with household incomes up to $11,999 also seem to be more relaxed, with a substantial 12 percentage point drop in the number of people who claim to give less than last year.
As to reunion dinners, the survey finds that many Hong Kong people still prefer a reunion dinner at home (68%) although an increased number of people also indicated (30%) that they will have reunion dinner out of home, a three-percentage point increase from last year. “Despite the majority of people intending to dine at home, they may still shop more seriously
than usual for the best and freshest dinner ingredients; in fact more restaurateurs have also
started to capitalize the opportunities by offering well-presented take-away dishes to capture
the wallet of those in-home diners and it seems to be a market of huge potential.”
About ACNielsen
ACNielsen, a VNU business, is the world’s leading marketing information provider. Offering services in more than 100 markets, the unit provides measurement and analysis of marketplace dynamics and consumer attitudes and behaviour. Clients rely on ACNielsen’s market research, proprietary products, analytical tools and professional service to understand competitive performance, to uncover new opportunities and to raise the profitability of their marketing and sales campaigns.
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