Uncertainty has made conserving cash a high priority not only for businesses but also consumers. Globally, and more so in Asia, consumers appear more inclined to bolster their savings accounts than spend spare cash.
While nearly half (48 per cent) of global consumers in the Nielsen survey say they are putting any spare cash they had into savings, the figure is a high 60 per cent for consumers in the Asia-Pacific region. In India, as consumers feel the slowdown heat, more and more now prefer to save — 66 per cent say they are putting their money into savings, up 8 percentage points from 58 per cent in October 2008. Nine of the top 10 markets putting their money into savings hail from the Asia-Pacific region.
Paying off debts is the next biggest priority for consumers globally perhaps to reduce their exposure during the current downturn — 32 per cent are using spare cash to pay off debts, credit cards and/or loans, up from 30 per cent in October 2008. In India, too, paying off debts is the next biggest priority after savings with 38 per cent choosing to do so, up from 34 per cent six months ago. In the Asia-Pacific region, holidays and vacations come next after savings, with 37 per cent spending spare cash on excursions, though the trend is down 4 percentage points from October last year.
Unemployment fears
As global consumer confidence plummeted to new lows, fears of unemployment and job uncertainty reached new heights. Six months ago, global consumers cited the economy and work/life balance as their two top concerns in life — but consumers’ priorities have rapidly changed along with the economic deterioration.
Job security was cited as one of the leading concerns among internet consumers in 31 of 50 countries surveyed by Nielsen. Global concern for job security jumped from nine to 22 per cent globally since the October survey. Both in India and Asia-Pacific, job security was cited as the biggest concern, while the sluggish economy is their next biggest concern.