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13 December 2006
Hong Kong
Consumers in India continue to ride high as the country draws greater world attention and local job market prospers. According to ACNielsen, the world’s leading market research and information company, the latest ACNielsen Global Consumer Confidence Index reached 99, an one-point up from the previous survey conducted in the first half of 2006.
India again leads the world with its latest consumer confidence index reaching a new height of 137, followed by Norway (134) and Denmark (129). At the 10th place, Hong Kong secured a confidence index of 111, the same level as in the previous survey conducted in May, 2006.
The other markets worth watching are Vietnam which has recorded a double-digit increase in the Index score from 106 to 116 this time round; and Thailand’s index scored 107 representing the greatest increase of 12 points from the last round. (Chart 1)
“Not only has India tops the world for the four consecutive rounds since the Index was established in early 2005 but the latest score of 137 is also a record high for the world,” said Ms Fanny Chan, Managing Director, ACNielsen Hong Kong. “There is no doubt that India is in its ever booming era, the result for Hong Kong is also encouraging along with the other up and coming market like Vietnam.”
The Least Optimistic The world’s least optimistic markets hail mostly from Europe although South Korea (56) remains at the bottom of the list. Japan and Taiwan are among the least optimistic in Asia Pacific recording an index of 71 and 80 respectively.
Major concerns
Amidst an improving sentiment, globally consumers continue to cite the Economy (39%), Health (34%) and Job Security (32%) as their major concerns for the next six months with the level of concern about the Economy declined slightly. (Chart 2)
The Economy
Consumers in Indonesia and Thailand are the world’s most concerned about the Economy (65%) followed by Taiwan (62%) and Hong Kong (61%). Yet the level of concern about the Economy among Hong Kong consumers declined for three percentage points.
Health
Health remains one of the top concerns for a third of world consumers, with the level of concern has declined substantially for Europe. Hungary which topped the world as the most concerned about health in the first half of 2006 has its level of concern taken over by China as the world’s most concerned about health (67%) this time round. Hong Kong consumers’ concern about Health has also increased by four percentage points to 48 percent over-taking Job Security as the second major concern in Hong Kong.
Job Security
Meanwhile, the level of concern about job security has remained in a number of markets. Topping the world as the most concerned is Hungary (63%) where consumers are more concerned about it than before (vs. 59%). In line with the globe, Hong Kong consumers’ concern about Job Security has remained with a slight decline from 48 percent to 47 percent.
“Judging by various indicators, Hong Kong consumers are proved to by more optimistic about the economic outlook which drives their intention to spend – a good sign for retailing and servicing sectors as the festive season is fast approaching.“
It’s worth noting that concern about Terrorism has not sustained from the renewal terrorist threats since mid 2006. Globally only 15 percent of consumers considered terrorism a major concern. In addition, despite on-going alerts by environmentalists about Global warming, consumers the world over don’t seem to be at the same pace with only seven percent cited it a major concern led by people in France (27%). As Hong Kong government is actively leading the effort in environmental protection while people are feeling the impact with a particularly warm December at the moment, six percent of Hong Kong consumers expressed concern about global warming, on par with the seven percent of global average.
Along with an improving consumer confidence comes a more positive disposition among consumers to spend. Across all regions, nearly half of North Americans are all set to embark on a shopping spree, followed by 44 percent of Latinos and 41 percent of consumers in Asia Pacific. The result for Asia Pacific also represents an increase of seven percentage points from the previous survey conducted six months ago. People in Hong Kong also sound upbeat about the state of their personal finance in the next 12 months and seem more ready to spend than before.
Spending sentiment in the next 12 months
By markets, consumers most likely to go on a spending spree soon continue to hail from the world’s most optimistic countries of Denmark (71%), India (68%) and Norway (66%). The high spending propensity is mainly driven by consumers in Asia Pacific where all markets except for Japan registered an increase in intentions to spend.
In particular, over half of consumers surveyed in New Zealand (61%), Australia (59%) and Hong Kong (57%) perceive it is now a good/ excellent time to spend on things they need, representing an increase from three to nine percentage points. Another Asia Pacific market worth mentioning is Thailand (43%) where there is a marked increase of 12 percentage points in consumers’ readiness to spend compare to the last survey. (Chart 3)
“Consumers in general are more upbeat about the state of their personal finances and less concerned about the economy and job market as we head into the Christmas trading period, which effectively ‘switched on’ their spend button,” said Ms Chan. “This positive sentiment is timely as we approach the gifting season in most parts of the world, where we are set to see a more upbeat retailing market this year.”
India leads the world with 87 percent of people feel optimistic about the state of their personal finance in the next 12 months, Indonesia (78%) ranked the second followed by the Pacific (73%). In Hong Kong 66 percent of consumers are optimistic about the state of their personal finance in the next 12 months which represents an increase by four percentage points.
Again, both Thailand and Vietnam showed the biggest improvement in consumer perception about the state of their personal finances by 13 points and 11 points respectively.
Asia Pacific has the most savers in the world
Despite a more positive sentiment, globally 40 percent of consumers said they would put spare cash into savings with the world’s top savers hail mostly from Asia Pacific. However, compared to the last survey, less is claiming to do so (49%). Thailand again led the “Top Ten Global Savers” list with 71 percent claiming to save their spare cash after covering essential living expenses, followed by people in Singapore (60%) and Taiwan (60%). The Philippines (57%) and Hong Kong (55%) are the only two markets in the top 10 savers list that have less people opting to save their spare cash.
“Retailers should be all set to maximize sales opportunities this Christmas, as consumers prepare to spend in the next 12 months, and as the crucial holiday selling period begins!” continued Ms Chan. Among the various spending options, New Clothes (35%) overtook Holidays/Vacation (34%) to become the world consumer’s top choice for disposing of their spare cash, followed by 34 percent for Out of Home Entertainment.
For Hong Kong consumers, it is no longer shopping or out of home entertainment (36%) or holidays/vacations (34%) but investing in shares of stock and mutual funds (37%) that appeal to their spare cash the most. (Chart 4) “There is no doubt that Hong Kong has seen an improving consumer sentiment year on year with a stable confidence level, greater confidence in personal finance and stronger willingness to spend.” Ms Chan added.
Vietnam (56%) tops the world with most people choosing to use their spare cash on out of home entertainment and China (42%) is also among the top 10 countries most ready to spend on out of home entertainment.
In terms of Holidays/Vacations, Thailand, renowned for its hospitality and tourism, has most people (67%) claiming they would spend on holidays/vacation if they have spare cash. Together with Singapore (52%) and China (48%) the trio comprises the world’s top three countries most likely to take holidays/vacations.
While the annual Telecom World 2006 that drew the world’s attention just came to a close, manufacturers may be pleased to know they made the right decision to participate the event in Asia – besides Vietnam (60%) and Thailand (58%) being the world’s most interested in spending on new Technology, the mainland Chinese consumers (49%) also consider new technology gadgets their first spending option among all, compare with 25 percent of those in Hong Kong.
About the Study
The ACNielsen Online Consumer Confidence and Opinion Survey is the largest half-yearly survey of its kind aimed at gauging current confidence levels, spending habits/intentions and current major concerns of consumers across the globe. The ACNielsen Consumer Confidence Index is developed based on consumer’s confidence in the job market, status of their personal finance and their readiness to spend. The latest survey, conducted in late October/early November, polled about 25,408 internet users in 46 markets from Europe, Asia Pacific, North America, the Baltics and the Middle East.
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 behavior. 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. To learn more, visit www.acnielsen.com.
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