Seven in ten (70%) urban, online Indians feel that this is a good time to buy things they want or need
The Consumer Confidence Index score for India in Q4 2016 has climbed three points to 136 from 133 in the previous quarter. India continues to lead the global index, and is followed by Philippines 132.
Established in 2005, the Nielsen Consumer Confidence Index is fielded quarterly in 63 countries, including India, to measure the perceptions of local job prospects, personal finances, immediate spending intentions and related economic issues of online consumers around the world. For Q4 2016, the survey was conducted between 31st Oct and 18th Nov, 2016. Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism, respectively.
“The three-point increase in the confidence index in the fourth quarter reflects strong economic and commercial performance at the end of the third quarter and at the beginning of the fourth quarter, further benefited by the timing of the festive season, when confidence typically rises,” said Prasun Basu, president, Nielsen South Asia. “During the survey period, the Indian government announced demonetization of high-denomination notes. While this move created short-term constraints for consumers, the long-term outlook is bullish–a sentiment clearly echoed in other Nielsen research and by a recently released study by the Reserve Bank of India–thus strengthening the overall confidence levels for the next 12 months.”
Job Prospects and Personal Finances
Sentiment levels on local job prospects over the next 12 months has gone up by three percentage points to 84% this quarter (was 81% in Q32016). Over four in five online respondents (84%) indicate increase in optimism on state of personal finance, same as the last quarter.
Discretionary Spending and Savings
70% urban Indians indicate it’s a good time to buy things they want and need over the next 12 month for the quarter. For the same quarter last year (Q4 2015), 65% of respondents felt that this was a good time for discretionary spending.
Putting into savings (65%), purchase of new technology products (54%), spending on holidays and vacations (53%) have been highlighted as avenues for utilizing spare cash for Q4 2016. Putting into savings (63%), new technology products (50%), holidays and vacations (47%) were the top three routes for Q4 2015.
When it comes to household expenses, this quarter 78% of respondents have indicated a change in spending to save on household expenses, five points lower than last quarter (83% in Q3 2016). This figure stood at 79% in Q4 2015.
For the fourth quarter of 2016 – Savings on gas and electricity (44%) , spending less on new clothes (39%), and cutting down on out of home entertainment (33%) are the focus areas of controlling spendings.
Major Concerns
Job security (17%) continues to be the top ‘biggest concern’ for this quarter, followed by state of the economy for 14% respondents, and terrorism (14%). The second biggest concerns cited are state of the economy (16%), and terrorism (14%).