Indian Consumers Earmark Children's Education, Property and Wellness as Top Purchasing Priorities for 2009.
Consumers are tightening their belts, with nearly 70% of consumers across the Asia/Pacific region looking to cut back on their discretionary spend for the next 12 months, revealed the recently released, inaugural MasterCard Worldwide Index of Consumer Purchasing Priorities. The Index, which will be released annually henceforth, provides valuable insights into consumers’ savings behavior and their discretionary spending priorities for the 12 months ahead.
This year’s Index is based on a survey of 6,019 consumers in 14 markets1, conducted between 1 and 29 September 2008. Data collection was via personal, telephone and Computer Aided Telephone interviews, with the questionnaire translated to the local language wherever appropriate and necessary. The Index and its accompanying reports do not represent MasterCard financial performance.
Key highlights from the Index include:
Regional Highlights
Close to 60% of consumers across the region spend over 10% of their personal annual income on discretionary items. More than 11% of respondents indicated that they usually spend in excess of 40% of their personal annual income on discretionary items.
More From This Section
Looking ahead at the next 12 months, a slightly lower percentage of male consumers (69%) are likely to cut back on their discretionary spending compared to their female counterparts (71%). Over 68% of consumers aged 30 years and below are looking to cut back on spend compared to nearly 72% of consumers aged 56 years and above.
In terms of the top areas of discretionary spend for the next 12 months; Dining and Entertainment (59%) emerged as the top category followed by Fashion and Accessories (46%), Children’s Education2 (44%) and Personal Travel (42%). Dining and Entertainment was the top purchasing priority in 11 out of the 14 markets surveyed, with the exception of India, Korea and the Philippines where Children’s Education was ranked first.
While savings priorities vary across the region, nearly 39% of consumers are nonetheless looking at saving more than 20% of their income over the next 12 months.
Highlights for India
65% of consumers indicated that they spend over 10% of their annual income on discretionary items, while 14% indicated that they spend above 40% of their annual income on such items.
92% of those surveyed said they felt it was important to save and are planning to assign their savings to Children’s Education (63.1%), Purchasing Property (42.4%), Investments (35.1 %), and Retirement (21.3%).
“While Indian consumers are indicating that they have a high propensity to save, they are doing so with the intent of buffering themselves in these tough economic times. Compared to consumers across the region, Indian consumers stand out for their commitment to saving for their children’s education, while also intending to spend the highest percentage of their discretionary income on the same category through the year ahead,” said T.V. Seshadri, vice president & country general manager, South Asia, MasterCard Worldwide.
MasterCard and its Suite of Research Properties
The MasterCard Worldwide Index of Consumer Purchasing Priorities comprises part of the MasterCard Worldwide Index suite of research products in Asia/Pacific. The other key MasterCard Worldwide Index research products include the long-standing MasterCard Worldwide Index of Consumer Confidence, the MasterCard Worldwide Index of Women’s Advancement, the MasterCard Worldwide Centers of Commerce and the MasterCard Worldwide Emerging Markets Index.
Besides the suite of Indexes put forth by MasterCard, MasterCard also develops Insights reports as part of its series of ongoing research and analysis of business dynamics, financial policies and regulatory activities in the Asia/Pacific region. Sixty-three reports have been produced since 2004.
About MasterCard Worldwide
MasterCard Worldwide advances global commerce by providing a critical economic link among financial institutions, businesses, cardholders and merchants worldwide. As a franchisor, processor and advisor, MasterCard develops and markets payment solutions, processes approximately 21 billion transactions each year, and provides industry-leading analysis and consulting services to financial institution customers and merchants. Through its family of brands, including MasterCard®, Maestro® and Cirrus®, MasterCard serves consumers and businesses in more than 210 countries and territories. For more information go to www.mastercard.com.