Nielsen survey shows consumer confidence on the rise
Nielsen's latest quarterly Consumer Confidence Index survey, covering quarter two of 2014, uncovered the biggest jump in consumer confidence since the beginning of the Great Recession in 2008 — up six points to 83.
According to the New York-based company, 49 percent of U.S. respondents to the survey said their personal financial prospects looked "good to excellent," up from 43 percent in the previous quarter. What's more, 42 percent of respondents said they plan to spend on discretionary items this year, a six-point increase from quarter four of 2012.
Although 78 percent of Americans said they believed they were still in a recession, a four-point quarterly increase, they still demonstrated a cautious eagerness to spend, Nielsen said. But an uptick in discretionary spending won't necessarily have a positive influence on every sector.
"In the U.S., positive news for job, housing and equity markets appears to have buoyed the spirits of Americans," James Russo, Nielsen's senior vice president, Global Consumer Insights told Store Brands.
"The retail environment for non-durable goods, however, is still catching up," he explained. "Retail dollar sales of fast-moving consumer goods are up 1.3 percent in [the] latest six months ending in June. Consumers are moving ahead slowly, and marketers need to adjust to a new consumer mindset of restraint, which will take time to reverse."
In the "prolonged new normal," value — encompassing attributes such as convenience, price, health, quality and more — will win, Russo stated. Store brands that deliver a strong value proposition, therefore, will have a better chance for success.
"Private brands are significant, as sales reached $112.9 billion* … for the 52-week period ending April 12, 2014," he added, "and that level is 18.7 percent greater than [in[ calendar year 2009.
In contrast, name brands grew only 8.3 percent during the same time period, Russo said.
"While store brands connect on quality and value, growth will not only be impacted by levels of consumer confidence, but more so by addressing negative perceptions among key consumer segments such as millennials," he noted. "They have greater negative perceptions related to packaging and lack of awareness. Quality packaging matters to them and attracts them through education and assortment in stores where they shop."
*Calculation based on Nielsen Strategic Planner, All Outlets Combined (xAOC), UPC-coded for the private-brand category for the 52 weeks ending Dec. 26, 2009, vs. 52 weeks ending April 12, 2014, for the total U.S. market.