Nielsen has released the findings of its latest Consumer Confidence Index (CCI).<\/p>\n
The results remained largely unchanged compared to the previous quarter, with South Africans seemingly in a state of limbo as they wait for a highly anticipated economic turnaround.<\/p>\n
According to Nielsen Africa MD, Bryan Sun, South African consumers have been hit particularly hard in 2018 with increasing unemployment, a 1% VAT increase and a number of petrol price hikes.<\/p>\n
“That said, there are some signs of positivity with the recent announcement of South Africa moving out of technical recession with 2.2% GDP growth in the third quarter of 2018, which may explain South Africans\u2019 willingness to adopt a \u2018wait and watch\u2019 approach and the resulting lack of movement in the country\u2019s latest CCI figures,” said Sun.<\/p>\n
“Despite the pressures, the current index is still seven points higher than confidence levels a year ago.”<\/p>\n
Change in spending<\/strong><\/p>\n Against this backdrop, Nielsen found that a hefty 85% of South Africans say they have changed their spending on household expenses in Q3 2018 – up one point from the previous quarter.<\/p>\n The top action they have taken to save on household expenses is to cut down on takeaway meals<\/strong> (66%), followed by new clothes<\/strong> (61%), while half of respondents have switched to cheaper grocery brands<\/strong>.<\/p>\n Almost half (47%) are spending less on gas and electricity<\/strong>, followed by 45% who are cutting down on out of home entertainment<\/strong>.<\/p>\n In terms of where South Africans would put money according to their budget allocation:<\/p>\n Sun said that the data shows that the willingness to spend freely among South Africans has declined.<\/p>\n “Moreover, consumers want products that make their life easier,” he said.<\/p>\n “In this environment, manufacturers and retailers need to deliver innovative products that meet the fine balance of convenience and optimal price points, which would be relevant to an increasingly cautious consumer.”<\/p>\n\n
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