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|Malaysian consumer confidence hovers at 101 in fourth Quarter 2011|
|Friday, 10 February 2012 15:35|
Online consumer confidence in Malaysia hovered at an index of 101 in the last quarter of 2011 and maintained its position as tenth most confident country among 56 countries surveyed according to the latest global online consumer confidence findings from Nielsen, a leading global provider of information and insights into what consumers watch and buy.
The Nielsen Global Online Consumer Confidence Survey, established in 2005, tracks consumer confidence, major concerns and spending intentions among more than 28,000 Internet consumers in 56 countries. Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism.
"Despite the announcement of higher than expected third quarter GDP growth of 5.8 percent (market estimation of 4.8%) in November 2011, online consumers back home are uncertain that the jump in both public expenses and private consumption as well as future contribution under the Economic Transformation Programme would be able to fully offset the bearish external conditions," said Kow Kuan Hua, Managing Director, Nielsen Malaysia. "Although economists have revised upwards the 2011 full year GDP growth forecasts, both they and consumers are concerned whether our exportoriented manufacturing growth rate will continue to rise upwards while global economic circumstances remain challenging. All these concerns are reflected in the survey. Nielsen's findings showed that consumer optimism towards job prospects, personal finances are lingering at the same levels."
Optimism towards local job prospects and personal finances status remain status quo
Overall, 64 percent of online respondents in Malaysia rate their job prospects as excellent or good over the next 12 months. With this, Malaysia maintains its seventh place among 56 countries in the top ten most optimistic job prospects list.
Although the confidence level towards personal finances in the coming 12 months experienced a minor one percent quarterly drop (61 percent described as excellent or good), Malaysia still ranked ninth among all countries surveyed (Chart 2).
Increasing food prices returns as one of the top 3 biggest concerns
Nearly a quarter (23%) of online consumers indicated that the state of economy is still their biggest concern, an increase of five percent quarter-on-quarter. Another economic factor, job security ranked second. Concerns on increasing food prices clinched third position (10%), followed by worries over debt (9%), differing by only one percent (Chart 3).
Timing is still not right for 69% of Malaysian consumers
Although buying intentions slightly increased by one percent on the positive end from three months ago, the percentage of respondents who stated that the coming 12 months will be a bad time to purchase items they want and need has also risen by three percent (Chart 4). Nielsen's survey also showed that 85 percent of online consumers indicated that they have changed their spending patterns to save on household income, a rise of six percent from a quarter ago.
"The intention of deferring plans to purchase items is reflected in our measurement of Fast Moving Consumer Goods (FMCG)," said Kow. "Consumption of FMCG categories tracked by Nielsen actually showed that 73 FMCG Categories2 experienced month-on-month declines in value share in November but rebounded in December (only 3 declined) due to festive build-up and yearend sales. However, in total 45 categories reported decline in value in the fourth quarter as compared to 22 categories three months ago. Total FMCG growth rate of 5.2 percent in the fourth quarter is actually lower than the annual growth rate of 6.8 percent, suggesting the slowdown in the last month (September) of third quarter was actually prolonged."
Switching to cheaper grocery brands clinches third place
While spending less on new clothes (58%) and cutting down on out-of-home entertainment (56%) remained the two top strategies to manage discretionary spending, more respondents have switched to cheaper grocery brands (53% as compared to 48% in Q3) to manage their household budgets in the last quarter of 2011. Cutting down on telephone expenses is now the fourth strategy (up by 4%) compared to 3 months ago.