India tops Nielsen's global consumer confidence index
November 3, 2009
Marketing and media information company Nielsen has said that consumer confidence in India has seen a steady rise for some time now and the country has topped the latest round of its Consumer Confidence Survey with 120 index points. However, increasing food prices have become a big concern for Indians besides work and life balance, Nielsen said.
“With the job prospects looking up, terrorism and swine flu are now off the radar of most Indians. There are more ‘here and now’ concerns like work-life balance. Increasing food prices are definitely a worry and will need to be watched carefully," said Vatsala Pant, director for consumer research, Nielsen.
Nielsen’s global consumer confidence index has also seen an increase and has jumped to 86 points this month from 77 index points in April this year, indicating rebounding consumer confidence across the world. In April, the Nielsen Consumer Confidence Index hit its lowest point of 77 index points, but as massive stimulus packages began to take effect around the world during the second quarter, consumer confidence slowly began to recover.
Consumer confidence in India has topped the global charts but concerns are still at large. Work and life balance is the biggest concern for 15% Indians overtaking job security which was the biggest concern for them three months back, the survey pointed out.
It said concern over increasing food prices had grown tremendously. In fact it has doubled to 14% from 7% in the last quarter and has moved up four spots to number two on the list of concerns for Indians, Nielsen said.
“At present it looks like the Indian economy and people’s confidence is on a fast improving trajectory. Everything looks positive from the point of view of the Indian job market, people’s finances, savings, and investments. If things continue the way they are heading, the downturn in India will soon become history,” said Ms Pant.
Indians are the most optimistic lot with about 67% people who think the country will be out of an economic recession in the next twelve months. The percentage of Indians who think India is currently under recession has also gone down by 10% to 52% this quarter.
“Economic downturn is finally subsiding not only in India but across the world and improving economic conditions and prospect of growth are infusing more confidence in people,” said Ms Pant.
The Nielsen Company said its consumer confidence in India is a reflection of the optimism in a country towards job prospects, personal finances, and their willingness to spend on discretionary items.
Eight in ten Indians are optimistic about job prospects in the country in the next 12 months, 16% think it is ‘excellent’ and 69% think it is ‘good’. Around 81% of Indian consumers are also very optimistic about the state of their personal finances in the next 12 months; 10% Indians think that personal finances will be ‘excellent’ and 71% think they will be ‘good’. Indians are the most optimistic lot globally when it comes to job prospects and their state of personal finances in the next twelve months.
Ms Pant said, “The resurging job market in the country has acted as a major boost to the confidence of Indians. Decreasing apprehensions regarding the stability of their jobs, resulting in a steady source of personal finance, has made Indians optimistic about the future.”
An optimistic and confident outlook on job prospects and personal finances stretches out to willingness to spend. Considering the cost of things today and their personal finances, 7% Indians think that it is an ‘excellent’ time to buy the things they want and need, and 44% think that it is a ‘good’ time to buy things, Nielsen said.
Talking about the spare cash utilisation of Indians, Ms Pant said, though savings stills rules the roost, with six in ten people opting for saving their spare cash for rainy days, Indians have become less conservative in terms of utilising their spare cash and have started investing in stock options. Indian concern over debts has also decreased as their job prospects and finances have started looking up. Three months back Indians were uncertain of the economy, but current behaviour shows that India’s public is more confident than they have been anytime in the past one year, she added.
Nearly, four in ten Indians will put their spare cash into buying new technology products 37% and 36% said they will pay off debts, credit cards, loans with spare cash. Other areas where Indians spend their spare cash are new clothes and home improvements and decorating both 35%, holidays and vacations 31%, retirement fund 26% and out of home entertainment 23%.