CONSUMER CONFIDENCE
Transcript of CONSUMER CONFIDENCE
1CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q1 2013 Copyright © 2013 The Nielsen Company
C O N S U M E R C O N F I D E N C EA CANADIAN PERSPECTIVE Q1 2013
2 CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q1 2013
OVERALL CONFIDENCE UP IN CANADA AND GLOBALLYIn Canada and most of the world, consumer confidence was on the
upswing in the early months of 2013.
The Nielsen Global Consumer Confidence Index measures views
about job prospects, personal finances and the ability and willingness
to spend. These economic indicators are captured in a consumer
confidence level.
Canada’s confidence level now stands at 102. That’s 11th among the 58
countries Nielsen surveyed.
Levels above and below 100 – a score that’s considered neutral – show
degrees of optimism and pessimism. In the previous survey, for the
fourth quarter of 2012, the consumer confidence level in Canada did
reach 100, and that was the highest level in 18 months. Over the last
year of Nielsen consumer surveys, the Canadian confidence levels have
improved every quarter.
Globally, the consumer confidence level rose from 91 to 93. More
important, 55% of the countries posted improved confidence levels,
compared to just 33% in Q4.
“With recent spending in consumer packaged goods relatively flat, the
greater optimism is welcome news,” says Carman Allison, director of
consumer insights, Nielsen Canada. However, the question remains
whether the positive momentum in many key measures will continue
deeper into 2013, and translate into increased buying.
NIELSEN CONSUMER CONFIDENCE INDEX CANADA GLOBAL
Q1 2012 93 94
Q2 2012 94 91
Q3 2012 99 92
Q4 2012 100 91
Q1 2013 102 93
3CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q1 2013 Copyright © 2013 The Nielsen Company
MORE READINESS TO SPEND Canadians are feeling noticeably better about of the state of their
personal finances. Two-thirds of Canadians consider their finances be
good (60%) or excellent (6%). That’s up five percentage points from the
Q4 Nielsen survey.
The upbeat attitude is also reflected in readiness to spend. At the start
of 2013, 45% of Canadians felt positive about spending, considering
current costs and their personal finances. That compares to 41% in the
previous Nielsen survey, continuing a consistent rise – an increase of 14
percentage points from the same point last year.
With the strong Canadian response, and 41% of U.S. respondents also
signaling their readiness to buy, North America leads the global regions
for spending intentions over the next 12 months.
IS THIS A
GOOD OR BAD
TIME TO BUY?
CANADA
Q1 2012
CANADA
Q2 2012
CANADA
Q3 2012
CANADA
Q4 2012
CANADA
Q1 2013
Excellent 4% 2% 5% 4% 4%
Good 27% 32% 35% 37% 41%
Not good 52% 47% 45% 43% 42%
Bad 16% 17% 12% 14% 11%
3Copyright © 2013 The Nielsen Company
AT THE START OF 2013, 45% OF CANADIANS FELT POSITIVE ABOUT SPENDING, CONSIDERING CURRENT COSTS AND THEIR PERSONAL FINANCES.
4 CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q1 2013
ENTERTAINMENT AND CLOTHES LEAD UPTICK IN DISCRETIONARY PURCHASESIs the apparent readiness to spend translating into actual loosening
of the purse strings? “We’re gleaning what I would call a cautious
eagerness to spend,” says Allison.
Nielsen asked Canadians how they use their spare cash after covering
essential living expenses. Compared to Q4, discretionary spending is
up for out-of-home entertainment (+4%), new clothes (+4%), home
improvements/decorating (+3%),new technology products(+1%) and
holidays/vacations (+1%).
While one-fifth of Canadians continue to say they have no spare cash
– a number that has remained consistent for the last four years – more
Canadians are putting money towards savings (+6%) and retirement
funds(+5%). However, timing is an influencer as Canadians typically
shift spare cash into investments before the tax deadline.
4 CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q1 2013
5CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q1 2013 Copyright © 2013 The Nielsen Company
OUT-OF-HOME ENTERTAINMENT
15%19%
18%22%
14%15%
17%20%
25%26%
18%20%
NEW CLOTHES
NEW TECHNOLOGY PRODUCTS
HOME IMPROVEMENTS/DECORATING
HOLIDAYS/VACATIONS
I HAVE NO SPARE CASH
PAYING OFF DEBTS/CREDIT CARDS/LOANS
PUTTING INTO SAVINGS
INVESTING IN SHARES OFSTOCK/MUTUAL FUNDS
RETIREMENT FUND
Q4 2012 Q1 2013
44%42%
35%
13%14%
13%
18%
41%
CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q1 2013
WHAT DO YOU DO WITH YOUR SPARE CASH?
SPENDINGSTRATEGIES
SAVINGSTRATEGIES
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STILL NOT SOLD ON REBOUND FOR JOBS AND ECONOMY“While Canadians seem to be more positive about spending, those signs
are tempered somewhat by a lukewarm view of the economy as a whole,”
says Allison.
Half of Canadians rate job prospects as good or excellent, down from
54% in the last Nielsen survey, and up just two percentage points from
this time last year.
Nielsen conducted the survey over the last 10 days of February and the
first week of March. The employment figures from both months show
that job gains and losses can still be somewhat volatile.
According to Statistics Canada, the Canadian economy created 51,000
jobs in February 2013, following a slight decline the previous month.
However, Canada lost 54,500 jobs in March, causing the biggest dent to
the country’s employment numbers in four years, as the unemployment
rate rose to 7.2%. Still, since the worst of the global recession in
July 2009, employment in Canada has increased by nearly 900,000.
Compared to the pre-recession peak, Canada has added more than
465,000 jobs.
The number of Canadians who feel that the country is still in a recession
has also barely moved – 50% now, up slightly compared to 48% in the
last Nielsen survey, and down two percentage points from 52% in the
first quarter of 2012.
HOW DO YOU RATE JOB
PROSPECTS?CANADA Q4
2012CANADA Q1
2013
Excellent 7% 4%
Good 47% 46%
Not good 37% 38%
Bad 6% 5%
(% ANSWERING YES)
7CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q1 2013 Copyright © 2013 The Nielsen Company
Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013
CANADA
50%48%49%50%52%
In April, the Bank of Canada reported that growth is expected to pick up
to about 2.5% in the second half of 2013. Despite this, weak growth in
the second half of 2012 means that annual average growth could be just
1.5% in 2013. The central bank now forecasts that the Canadian economy
will reach full capacity in mid-2015 (later than anticipated in January
2013). The Bank of Canada also expects the household debt-to-income
ratio to stabilize near current levels, and consumer spending to grow at
a moderate pace.
DO YOU THINK YOUR COUNTRY IS IN AN ECONOMIC RECESSION AT THE MOMENT?
(% ANSWERING YES)
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FRUGAL HABITS CONTINUELingering concerns about the economy have reinforced some new
spending habits. 62% of Canadians in the Q1 survey say they’ve
changed their spending to save on household expenses. That’s virtually
unchanged from the first quarter of 2012.
How are Canadians looking to save? Compared to the previous
Nielsen survey, more people are looking to cut down on out-of-home
entertainment and on take-away meals. At the same time, Canadians
aren’t as likely as they were before to switch to cheaper grocery brands,
drive less often, and delay technology upgrades. “Specific saving
strategies are evolving, but we’re still seeing a recessionary mindset,”
says Allison.
Here are 15 ways that Canadians are saving, with the percentage change
from the Q4 2012 Nielsen survey in parentheses.
Cut down on out-of-home entertainment: 61% (+5)
Spend less on new clothes: 58% (-2)
Cut down on take-away meals: 57% (+2)
Try to save on gas and electricity: 56% (-1)
Switch to cheaper grocery brands: 44% (-7)
Cut down on telephone expenses: 32% (+1)
Use my car less often: 31% (-8)
Cut down on holidays/short breaks: 31% (-5)
Delay upgrading technology (PC, mobile, etc.): 26% (-10)
Delay replacing major household items: 26% (-4)
Look for better deals on home loans, insurance, 23% (-6)credit cards, etc.: Cut down on at-home entertainment: 23% (no change)
Cut out annual vacation: 23% (-4)
Cut down on or buy cheaper brands of alcohol: 19% (-3)
Cut down on smoking: 13% (no change)
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9CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q1 2013 Copyright © 2013 The Nielsen Company
DEBT AND ECONOMY REMAIN TOP CONCERNSDebt and the economy are again the biggest worries for Canadians. Yet
those concerns are falling a bit, while other financial concerns – bigger
bills (food and utilities) and job security – are on the rise. “We’re well
into an economic recovery, but it doesn’t feel that way to a lot of people
which will continue to fuel value based market drivers,” says Allison.
Here’s what Canadians named as their #1 and #2 concerns over the next
six months, with the percentage change from the last survey noted.
Allison summarizes, “As we head into 2013, we’re seeing a bit of mixed
results – consumers are feeling more optimistic but are still cautious
about spending. Only time will tell if consumers will open their wallets
wider and break some frugal habits.”
WHAT IS YOUR BIGGEST
CONCERN OVER THE NEXT
SIX MONTHS?
#1 CONCERN
#2 CONCERN
TOTAL
Debt 16% 11% 26% (-2)
The economy 14% 11% 25% (-3)
Job security 13% 8% 21% (+2)
Increasing food prices 8% 13% 21% (+4)
Health 12% 9% 21% (+3)
Increasing utility bills 7% 10% 17% (+2)
Work-life balance 7% 6% 13% (-2)
CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q1 2013
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ABOUT THE SURVEY The Nielsen Global Online Survey was conducted February 18 to March
8, 2013, and polled more than 29,000 consumers online 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 10M
online population for survey inclusion. The Nielsen Global Survey, which
includes the Global Consumer Confidence and Spending Intentions
Survey, was established in 2005.
ABOUT NIELSEN 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, mobile measurement, trade shows and related
properties. 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.
Copyright © 2013 The Nielsen Company. All rights reserved. Nielsen and
the Nielsen logo are trademarks or registered trademarks of CZT/ACN
Trademarks, L.L.C. Other product and service names are trademarks or
registered trademarks of their respective companies. 13/6462
11CONSUMER CONFIDENCE: A CANADIAN PERSPECTIVE – Q1 2013 Copyright © 2013 The Nielsen Company