CONSUMER SURVEY
Thailand among the world's most optimistic nations
By The Nation
2011-02-01
Thailand posted a strong, 10-point increase in consumer confidence at the end of 2010 with a Consumer Confidence Index of 102 according to the latest Global Consumer Confidence Index released by Nielsen Company carried out in the fourth quarter.
To them, the economic health will be the biggest concern in the next six months (21 per cent), followed by political stability (12 per cent) and job security (9 per cent). In the previous survey conducted in the second quarter, political stability was the biggest issue (23 per cent), followed by economy (17 per cent), and job security (7 per cent).
In June 2010, the index for Thailand, which tracks consumer confidence, major concerns and spending intentions among consumers, was 92. In contrast, the Asia Pacific Index declined 4 points from 101 in the second quarter to 97 in the fourth quarter.
Nielsen's survey polled over 29,000 internet consumers in 52 countries last November 2010. Globally, confidence levels fell in 25 out of 52 countries surveyed as widespread concern for unemployment, job creation, rising food and utility costs eradicated any expectation of sustained economic recovery.
Consumer Confidence Index levels above and below a baseline of 100 indicate degrees of optimism and pessimism respectively. Thailand finished the year with a Consumer Confidence Index of 102 which remained relatively high compared to the first half of the year while global consumer confidence index remained stable from the previous quarter at 90 and ended the year two index points below the start of the year.
"The second half of 2010 saw a strong rebound in consumer confidence in Thailand, again underscoring the country's resilience. Over the years Thai consumers have consistently demonstrated a great ability to bounce back from political challenges and serious threats from natural disasters. After facing massive political demonstrations which severely impacted the country in the second quarter of 2010, consumer behavior and attitudes have more or less returned to normal. Other factors that have also resulted in Thai's feeling more confident in the past 6 months include a strong Thai Baht, the buoyant local stock market, modest inflation and stronger gold prices," said Aaron Cross, managing director of Nielsen Thailand.
Thailand was one of 14 countries (out of 52 where the survey was conducted) that ended 2010 with a consumer confidence index of 100 points or greater.
Nine of these countries are from Asia Pacific:
India (131),
Philippines (120),
Norway (119),
Indonesia (116),
Australia (112),
Switzerland (110),
Singapore (109),
Brazil (108),
Malaysia (107),
Saudi Arabia (107),
Vietnam (103),
Sweden (103),
Thailand (102)
and China (100).
This is an increase compared to 11 countries who hit the 100+ index mark one year ago.
In the survey, Thai consumers appeared more optimistic about job prospects, personal finances and ability to spend.
- Optimism about job prospects jumped by 14 points: 48 perc ent of Thai consumers believed that their job prospects over the next 12 months would be "Good or Excellent", up from 34 per cent in the second quarter. Across the Asia Pacific region, the average was 55 per cent at the end of 2010.
- 6-point increase in perception of the state of personal finances: The proportion of consumers who feel their personal finances are in an excellent or good state increased from 50 per cent in the second quarter to 56 per cent in Q4 2010, exceeding the average 55 per cent for Asia Pacific.
- 8-point increase in intention to spend: As a result of the overall positive sentiments towards job prospects and personal finances, 46 per cent of Thai consumers feel that now is the right time to the buy things they want compared to 38 per cent in second quarter.
In the survey, it showed that 73 per cent of consumers put spare cash into savings, up from 71 per cent in the second quarter. The average for Asia Pacific was 59 per cent.
After savings, holidays/vacations (43 per cent), buying new technology products (30 per cent) and making improvements to homes (26 per cent) were the three most popular uses of spare cash. (Table 3)
"The slight increase in the proportion of consumers putting spare cash aside for savings may be a signal that consumers are still expecting some rainy days ahead, given the continuing global concerns about inflation and a sustainable economic recovery," Cross added.
Cautious spending behavior expected as consumers seek to save on household essentials
Although more consumers in Thailand have indicated a stronger perception of their ability to spend, Nielsen's survey also revealed that 88 per cent of Thai consumers changed their spending habits to save on household expenses during the fourth quarter, compared to 85 per cent in the second quarter.
Thai consumers indicated that they are likely to reduce their expenditures by saving on gas and electricity (54 per cent), cut spending on new clothes (47 per cent), cut down on out of home entertainment / telephone expenses (44 per cent), and cut down on holidays/ short break (33 per cent).
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