As the global economy shows signs of recovery, the confidence level among consumers across the globe is rising high, finds the Nielsen Global Consumer Confidence Survey. India is no exception, where, amidst certain concerns, people are gradually gearing up for better days and at the same time, religiously saving for the future.
According to the recent round of the survey, India ranks second, with 117 index points behind Indonesia (119 points) in terms of consumer confidence level. The survey was conducted among 17,500 Internet users in 29 markets across the world to track the confidence of consumers, their major concerns and spending habits.
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However, things are a little glum in the personal finance segment. The percentage of Indians who are optimistic about the state of their personal finances in the next one year has gone down by 3 per cent.
According to the survey, decreasing confidence in the state of personal finances is affecting their willingness to spend. The survey says that in the last round, 51 per cent Indians thought that it was an appropriate time to buy things, while in the fourth quarter, 41 per cent thought the same.
The survey also finds that Indian consumers have become cautious about their discretionary spending. After meeting the necessary expenses, 65 per cent Indians put their spare cash into savings. According to the survey, they have become watchful of investing in the stock market.
After saving and investing, 33 per cent Indians like to put their spare cash into new technology products. Paying off debts/credit card loans has gone down in importance for Indians (30 per cent). Home improvements/decorating (32 per cent), new clothes (31 per cent) and holidays/vacations (31 per cent) have taken its place in the priority list. After clearing their debts, a quarter of Indians would put their spare cash into retirement funds and nearly two in 10 Indians would spend on out of home entertainment.
The survey also shows that increasing food prices is the biggest concern (17 per cent) for Indians in the fourth quarter of 2009. Job security follows it in the list of concerns (13 per cent). The third on the list is work-life balance, with 12 per cent Indians worrying about it. Indian concern over global warming has gone up by 3 per cent to 10 per cent and the concern over the economy has gone down to 9 per cent from 12 per cent in the third quarter.
Other concerns bothering Indians are terrorism and children's education and welfare (both 6 per cent), health and parent's welfare and happiness (both 5 per cent), debt and increasing utility bills (both 4 per cent), political stability and increasing fuel prices (both 2 per cent), war, crime, tolerance towards different religions and tolerance towards other countries' values (all 1 per cent).
"In the third quarter of 2009, consumers had started believing that the worst was over but rising food prices and high grocery bills have put the cautious optimism back in them. Until the consumers are reassured that recovery is going to accelerate, they are going to be cautious," explains Vatsala Pant, director, client solutions, The Nielsen Company in an official statement.