Nielsen: Filipino consumers 3rd most confident in world

MANILA, Philippines – Filipinos grew more bullish about their finances in the second quarter of the year, bucking the bearish sentiment of most of their neighbors in Southeast Asia, a survey showed Tuesday, July 22.

According to the latest Nielsen Global Survey of Consumer Confidence and Spending, the Philippines’ consumer confidence score jumped 4 points from the first quarter to 120, making it the third highest globally.

Most of its neighbors booked declines in scores amid escalating political instability and rising food prices across the region.

Consumer sentiment plays a key role in the Philippines as household spending accounts for two-thirds of the economy.

“The Philippines is showing quarter-on-quarter increase in consumer confidence, which is largely driven by a strong economy and its growing middle class population,” Nielsen Philippines Managing Director Stuart Jamieson observed.

The Nielsen survey showed Malaysia was up one point to 93, while 4 of 6 Southeast Asian markets covered in the survey recorded declines in their scores.

Vietnam and Singapore dropped one point, both posting a score of 98, while Thailand posted the biggest drop of 3 points to 105.

Indonesia’s confidence score was the second highest globally despite dropping one point to 123.  

Globally, consumer confidence inched up by one point to 97 in the second quarter.

The Nielsen survey, established in 2005, measures consumer confidence, major concerns, and spending intentions among more than 30,000 respondents with Internet access in 60 countries. Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism.

Consumers’ top concerns

Job security, work-life balance, and health were the top concerns of Filipinos, while most of their Southeast Asian counterparts were worried about political stability and food prices.

Even if Filipino consumers had a positive outlook, they were still prudent with their money, the survey noted.

Filipino consumers, like consumers from other Southeast Asian markets, channeled money into savings when asked how they utilized their spare cash after covering essential living expenses. (See chart 3)

Eighty percent of consumers in the Philippines perceived the state of their personal finances over the next 12 months as good or excellent. This followed Indonesia’s 85%.

Consumers in Thailand, Singapore, Vietnam, and Malaysia were less optimistic. In Thailand, only 62% of consumers saw the state of the personal finances over the next 12 months to be good or excellent, 55% in Singapore, 53% in Vietnam, and 50% in Malaysia.

Curbing spending

In Southeast Asia, Thai consumers are the most committed to keeping an eye on their household expenses – more than 9 in 10 (92%) changed their spending in the past year to cut down on expenses. In Vietnam, 85% changed their spending; in Malaysia and the Philippines, 80%; in Indonesia, 79%; and in Singapore, 58%.

Limiting spending on new clothes was the top tactic of Filipino consumers, followed by saving on gas and electricity, and delaying technology upgrade. 

“Although more Filipino consumers are joining the ranks of the middle class, these consumers have a strong focus on saving for household emergencies, health issues, and the future in general. They are more aware of how they manage their day-to-day and long-term financial goals,” Jamieson said.

To be able to tap into the expanding but financially-conscious middle-class Filipino consumers, marketers should develop a range of products and services that will provide good value for money, Jamieson said. – Rappler.com