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24
November 2004
Europe
More than half of consumers in Europe’s largest countries
say their economies have deteriorated in the last six months
and, with few signs of economic recovery, are bracing themselves
for another tough year ahead, according to the findings of
a new survey released today by market research leader, ACNielsen.
The Italians remain the most pessimistic overall (only 21%
believe the economy will improve over the next 12 months)
with Europe’s most optimistic nation being Norway (where
42% believe the economy will improve).
According to the
latest ACNielsen Global Consumer Confidence Survey
conducted in October over the Internet1
among 14,000 consumers in 28 markets across Europe, the US
and Asia Pacific, 40 per cent of consumers in Europe think
their economy deteriorated over the last six months, 41% thought
it had stayed the same, and 35% expect it to deteriorate further
over the next year.
‘It has been
a tough time for consumers in Europe and most people believe
things are going to get worse – or at the very best
remain the same - before they get any better,” said
Frank Martell, president, ACNielsen Europe.
The ACNielsen survey
found that slower-than-expected economic growth had seriously
impacted consumer confidence in the major European markets
of Germany, Italy and France. Italian and French consumers
have been hit the hardest – with around two thirds of
Italian (69%) and French (60%) respondents saying they felt
their economies had deteriorated in the past six months.
And while they don’t
think their economy will be quite as bad in the next 12 months,
they aren’t expecting economic recovery any time soon.
Consumers in the
Asia Pacific are clearly the most optimistic about the next
12 months – “They’ve come out a difficult
period and are finally looking to brighter horizons. 53% of
people in Asia Pacific believe their economies will improve
in 2005 compared to 43% in the US and only 31% in Europe,”
said Martell.
“The prevailing
mood in Europe is that consumers seem resigned to their current
economic situation but life but must go on, and despite the
current gloomy economic outlook, they are not going to sit
around and get depressed about it.”
When the going gets tough…the tough go shopping!
On the contrary, European discretionary spending habits are
surprisingly healthy, especially compared to a global scale.
When consumers worldwide were asked about their spending habits
and what they do with their spare cash once living essentials
are covered, Europeans said they wanted to go out and enjoy
life with out-of-home entertainment topping their list of
priorities. In fact, globally, European consumers spent more
on ‘out of home’ entertainment than the US and
Asia Pacific.
After spending on
‘out of home entertainment’, putting money into
savings/deposits was the second most popular spending choice
among consumers in nearly every European market – followed
equally by spending on home improvements/decoration and buying
new clothes.
In the Top 10 ranking
for those consumers investing their money in keeping up ‘chic’
appearances, six countries were from Europe, led by 51% of
consumers from the Netherlands, followed by Spaniards (45%),
Germans (42%) and Austrians (40%).
Spain is obviously the place to go for a good time. Nearly
two thirds (60%) of Spaniards, the highest ranking on the
ACNielsen global spending habits scale, said they spent their
spare cash on ‘out of home entertainment’, compared
to a global average of 34% - as did nearly half of respondents
in the Netherlands, Belgium, Italy and France.
Interestingly, when it comes to saving money and putting spare
cash into their bank accounts, the Netherlands, Belgium, Italy
and France say they are also among Europe’s most conscientious
savers. “This suggests a healthy balance between spending
for the present and enjoying life as well as saving for the
future in these countries”.
The UK, however, has a different story to tell.
“From this ACNielsen survey, we get a general picture
of financial attitudes and spending priorities throughout
the world. In Europe, the UK has the highest percentage of
consumers (37%, compared to the global average of 27%) who
say they spend their spare cash on paying off credit cards
debts and loans – and at the same time are among those
least likely to invest in savings/deposits. The UK also ranks
among the lowest in Europe for investment in superannuation/pensions
and the stock market/mutual funds.
The British were also among the top three markets claiming
not to have any spare cash. After Portugal, where 18% of Portuguese
respondents said they didn’t have any cash left after
essential living expenses, the UK ranked second with Germany,
with 16% of respondents in both markets saying they had no
money left for spending or saving.
“Among British consumers who do have spare cash, their
first priority is debt repayment. Overall, the UK ranked fifth
for debt repayment among all 28 countries included in the
survey,” observed Mr. Martell.
In stark contrast, the Belgians rank among the highest in
Europe for putting their spare cash into saving/deposits accounts
and into superannuation and pensions, while the Norwegians
ranked the highest for saving the most in share and mutual
funds.
In the top 10 ranking for those consumers putting money into
retirement payments, eight were from Europe, led by Austrians
(24%), Germans (18%), Belgians (17%), Danish and French (12%).
This compares to a global average of 7%.
On a global comparison, Asia Pacific consumers rank head of
Americans and Europeans for putting their spare cash into
savings/deposits accounts and they’re the highest saving
region in the world. 49% of respondents in the Asia Pacific
said that bank/deposits are their top ‘spare cash’
priority compared with only 23% of consumers in the USA.
“It is interesting that despite being most pessimistic
in the world about their current and future economic outlook,
Europeans appear to be the biggest spenders in comparison
to respondents in the US and Asia Pacific. Europeans are spending
more on out-of-home entertainment, new clothes, home decorating/improvements
and international holidays. Asia Pacific respondents top the
scale for spending on new technology as well as Savings/deposits
accounts whilst the USA takes the lead over Europe and Asia
Pacific in only one spending category – paying off debts/credit
cards and loans.
Europeans’ Major Fears and
Concerns
Not surprisingly,
consumers the world over share common concerns - for the economy
and their job security, which were also the two top consumer
concerns in Europe, US and Asia Pacific. Aside from these
two concerns however, there are some individual fears and
concerns shared by each region.
“When we look
at consumers’ main fears and concerns across the world,
we can see that each country has very distinct attitudes depending
on their current social and political climate – which
could be directly related to their country’s involvement
in the war in Iraq,” observed Mr. Martell.
On a global scale,
fear of a terrorist attack is highest among the British and
Italians (66% and 65% respectively) followed by the US (64%)
and Spain (61%). This compares to a global average of 40%.
In total, six in the top 10 countries most concerned about
terrorism were European countries.
“There is
a real concern in the UK and Italy about terrorism as well
as in Spain, a clear reminder that the Madrid train bombings
earlier this year are still very fresh in people’s memories.”
Not surprisingly,
Spain and Italy also scored the highest in Europe, and second
and third globally after the US, for their concern about the
War in Iraq and where both countries have their troops involved.
Despite being the
most optimistic about their economic future, Asia Pacific
respondents were on a global scale, the most concerned about
their job security. “The Asian region has experienced
some tumultuous years and has battled with unstable financial
as well as political conditions. The double-dipped Asian crisis
in the last six years combined with SARS has taken its toll
on Asian consumers and has left them with a sense of vulnerability
and innate insecurity,” said Mr. Martell.
“Asian consumers
are acutely aware of saving for a rainy day – because
their recent experience has taught them that when it comes
to economic crises, you can never be too well prepared.”
1Excluding,
Vietnam, where survey was conducted Face to Face
About ACNielsen
ACNielsen, a VNU business, is the world’s leading marketing
information provider. Offering services in more than 100 countries,
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.
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