The economy is the biggest concern for respondents
Online consumer confidence in South Africa increased by one point to 78 in the third quarter of 2012 but remains flat when compared year-on-year (Q3 2011) according to global consumer confidence findings from Nielsen, a leading global provider of information and insights into what consumers watch and buy.
In the latest round of the survey, conducted between August 10 and September 7, 2012, overall confidence rose in 52 percent of global markets1 measured by Nielsen, compared to a 41 percent increase in the previous quarter. Consumer confidence in Q3 2012 increased in 30 of 58 markets, declined in 19 and remained flat in seven.
"The subdued third quarter results reflect an overall trend that is neither positive nor negative as consumers are treading water very carefully. There is a slight upward trend in the third quarter with South African consumers starting to spend a little more, but cautiously on a few luxuries, said Dwight Watson, Managing Director, South and Sub-Saharan Africa."
Chart1: South Africa and Global Consumer Confidence Index
The Economy is the Biggest Concern
The state of the economy has become a cause for major concern among South Africans as a result of the ongoing labour unrest in various industries that is impacting negatively on the image of South Africa as an investment destination. Crime, debt, job security and increasing food prices also rank in the top five major concerns for consumers. This is a continuing trend from the first quarter of this year and is not unique to South Africa; the economy and job security remain top concerns globally.
Chart 2: What are the major concerns for South African Consumers
Recessionary Mindset Continues
According to Nielsen's survey, 70 percent of consumers polled believe the country is in a recession, a slight increase of one percentage point from Q2'2012. Of those that still believe there is a recession, just over sixty percent (61%) believe it will continue for the next twelve months. South African respondents are the most pessimistic in the Middle East, Africa, Pakistan (MEAP) region.
State of Personal Finances
Respondents are cautiously optimistic about the state of their personal finances with 41 percent indicating it will be good for the next year. This slightly more upbeat perception of personal finances has led to 24 percent of consumers (up 5% from Q2'2012) believing that now is a good time to spend on some luxuries. Consumers are seeking some relief and loosening their belts by spending a little more on take-away meals, new clothes and out-of-home entertainment.
Chart 3: How are South African Consumers redirecting their spare cash
What will consumers do when economic conditions improve?
When asked about their spending habits when economic conditions do improve, 60 percent have indicated they will continue to try and save on gas and electricity (60%), cut down on take-away meals (48%), cut down on telephone costs (38%), switch to cheaper grocery brands (37%) and use personal vehicles less often (29%).
Nielsen's survey shows that North America and Europe reported the only quarterly consumer confidence increases, rising three index points to 91 and one point to 74, respectively. Asia-Pacific (100) and Middle East/Africa (98) regions remained flat in Q3 and Latin America decreased two index points to 94.
India (119) and Indonesia (119) reported the highest index scores in Q3 while China's index score increased 0.6 to 106 and the U.S. increased three points to 90.
The biggest quarterly consumer confidence gains in Q3 were reported in Switzerland (+10), Belgium (+9), Australia (+8), Thailand (+8), Hungary (+7), Norway (+7), United Arab Emirates (+6), Italy (+5) and Canada (+5).
The biggest quarterly consumer confidence declines in Q3 were reported in Hong Kong (-15), Argentina (-11), South Korea (-10), Vietnam (-8), Colombia (-8), Israel (-7), Venezuela, (-7), Malaysia (-6) and Finland (-5).
About the Nielsen Global Survey
The Nielsen Global Survey of Consumer Confidence and Spending Intentions was conducted August 10 - September 7, 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 10M online population for survey inclusion. The China Consumer Confidence Index is compiled from a separate mixed methodology survey conducted 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, 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.
Posted on 14 Nov 2012 11:25