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Consumers in 10 of the world’s top economies continued to be wary of spending their money in May, according to the latest edition of the Nielsen Economic Current, which provides a snapshot of global consumer and retail trends across 10 countries that represent nearly 65 percent of global GDP. Tracking key performance indicators, Brazil and the United Kingdom led the pack with solid improvements in their scores, while the United States and Canada showed declines. The rest of the countries tracked (China, France, Germany, India, Italy and Spain) showed no movement from the previous month. In all countries measured, consumers are saving more of their money -- even Americans, who have had a low savings rate, are holding onto their cash as concerns about unemployment and financial security continue.
A Link Between Buzz And Spending
For the latest Economic Current, Nielsen tracked online discussions about the economy and found that since mid-March 2009, recession buzz has dropped 47 percent in the United States, the United Kingdom, Germany, Italy, Spain, Australia and New Zealand.
“Globally, Nielsen is tracking online discussions related to the recession and when the recovery may emerge. While discussions about the recovery are still quite low, we have seen that the public is talking less about the recession -- often dramatically less,” said James Russo, VP, Global Consumer Insights for The Nielsen Company.
“In the U.S., we found that recession discussions have dropped since hitting a peak in January. There appears to be a strong correlation between what consumers are saying in discussion groups and their subsequent actual purchase behavior. From the end of 2008 to March 2009, when recession discussions were highest, we found that sales actually declined by 2.3 percent. From mid-March to early June, as recession chats dropped, we found that sales actually showed a modest increase,” continued Russo. “This is an important dynamic as we look to signs of a sustained recovery, and Nielsen will be at the forefront of this research.”
After showing some positive movement in April, U.S. consumers pulled back on shopping and how much they spent per trip. Meanwhile, the shift to value channels such as supercenters, club and dollar stores continued, as did the move to private label store brands.
Canadians are slightly more optimistic than their southern neighbors. While they aren’t shopping any more frequently than before, they are spending more per trip. But like Americans, Canadians are also turning to private label store brands and value channels.
Western Europe remained in a neutral position. Some countries’ consumers shifted to value channels and store brands, but they generally reduced the frequency of their shopping trips and spent no more, or in some cases, less than in previous months.
Brazilians were the most positive of the lot, with consumers shopping more frequently.