“While Europe’s challenging economic conditions in the second half of 2011 bought renewed vulnerability and fragility to consumers and financial markets globally, some of the most positive news last quarter came from the world’s two largest economies—the U.S. and China—where confidence rebounded to Q1 2011 levels,” said Dr. Venkatesh Bala, Chief Economist at The Cambridge Group, a part of Nielsen. “Buoyant domestic consumption also maintained confidence levels in the large emerging economies of India, Indonesia and Brazil. However, slowing GDP growth within emerging economies and inflationary pressures would suggest some degree of caution for the year ahead.”

The Nielsen Global Survey of Consumer Confidence and Spending Intentions, established in 2005, tracks consumer confidence, major concerns and spending intentions among more than 28,000 Internet consumers in 56 countries. Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism.

Personal finances are improved, but spending is still restrained

More than half (52%) of global online consumers described their personal finances for 2012 as excellent/good, up from 50 percent in Q3 2011, but 65 percent indicated it is not a good time to buy, up one percent from the previous quarter.

“Overall, consumer discretionary spending will remain restrained and cautious in the first half of 2012,” said Dr. Bala. “Despite consumers becoming more confident about their personal finances for the year ahead, there is still a reluctance to spend, especially in the West; rising tensions in the Middle East and their impact on gasoline prices could further compound global consumer concerns and spending plans,” added Dr. Bala.

Consumer concern for the economy increased as a top fear among 18 percent of global respondents—an increase of six points from last quarter, which resulted in nearly two-thirds (64%) of consumers around the world indicating they believe they are in a recession, up from 62 percent last quarter. A growing number of online respondents in Asia Pacific (53%), Europe (74%), Middle East/Africa (74%) and Latin America (47%) indicated they believe they are in a recession. And while 86 percent of North Americans feel they are in a recession, it was the only region to report an improvement from 88 percent in third quarter.

• For more detail and insight, download Nielsen’s Q4 2011 Consumer Confidence report.

Cost of an Ad
The Super Bowl investment is economically resilient, remaining relatively stable despite fluctuations in the primetime average—and rising consistently over the past five years despite a rocky economy.

Big Spenders: Automotive Makes a Comeback
2011 was the year of the auto comeback. Spending on automotive ads far surpassed other categories and more than doubled versus previous years. Nine different auto brands took center field in the commercial breaks, versus an average of two to four brands in years prior. Creative quality also improved in 2011, with an unprecedented four auto spots making Nielsen’s annual Most-Liked list. Chevrolet’s “Wild Ride” garnered the distinction of being the most watched ad of all time, with an estimated 119,628,000 viewers watching its Super Bowl airing. This year, Chevy is breaking ground again with the Game Time app, which will leverage consumers’ simultaneous cross-screen behavior and reinforce branding from traditional TV advertisements.

Top Five Super Bowl Advertising Categories (2007-2011)
Year Over Year Spend Breakdown (in millions)

Other Spend Trends

• Beer: Bud Light and Budweiser have dominated the turf when if comes to Super Bowl beer advertising over the past five years. Consumers have come to expect the fleet of creatives, including the iconic Clydesdale ads. In 2010 and 2011, other brands like Michelob and Stella Artois came to play. What can viewers expect this year?
• Motion Picture: Movies have a strong presence in Super Bowl ad lineup, as studios capitalize on the massive audience to parade their best bets for the year. From 2008-2011, at least one of the top five highest grossing films had a slot in the Super Bowl line up. Motion picture ads increased after 2008 and have had a consistently strong presence during the game since, reaching ten ads in last year’s game.
• Regular Soft Drink: While fewer Soft Drink ads have traditionally aired during the Super Bowl compared to other categories, they make an impact by creating minute-long spots.
• Tortilla Chips: Tortilla Chips have emerged as a highly anticipated category of ads, led by the fan created ads. Last year, three Doritos ads made Nielsen’s Most Liked and Most Remembered list.

With half of respondents claiming to be overweight, it’s logical that half (48%) are also trying to lose weight. And for more than three-quarters (78%) of these consumers, the way to shed unwanted pounds is through diet. But do consumers understand what they are eating? Not necessarily. The study finds that half (52%) of consumers around the world understand nutritional information panels on food packaging only in part. Four-of-10 consumers understand nutritional labels “mostly” and seven percent say they do not understand them at all.

And what about trust—do consumers believe that claims on product packaging are accurate and truthful? Here too is ambiguity in the minds of consumers. Of 10 different product claims studied, only three received a complete believability rating by more than 20 percent of consumers (calorie content 33%, vitamin content 28% and fat claims 23%), highlighting a need to better educate consumers.

Support for Calorie Counts on Restaurant Menus

Consumers around the world show support for calorie counts on restaurant menus, with half (49%) of global respondents reporting that fast food restaurants should always include calorie information on menus, and 31 percent indicating that fast food restaurants should sometimes do so. Twenty percent of global online consumers think fast food menus should never include calorie data.

Consumers around the world have healthy eating on their minds and consumer packaged goods (CPG) marketers have an opportunity to help. Consumer-friendly nutritional labeling can be a powerful marketing tool as consumers are hungry for easy-to-understand information. Clearly there is a need and an opportunity for more education to help reduce the skepticism that is apparent around all parts of the globe. And there is a need to offer tasty and healthful options to satisfy both the mind and body.

• For more country-by-country insight and a look at healthy eating trends around the world, download Nielsen’s Global Report on Food Labeling Trends.

Android continues to hold the lead among all smartphone users, with 46.3 percent of all smartphone owners surveyed in Q42011 reporting they have an Android-based mobile phone.

As of Q42011, 46 percent of US mobile consumers had smartphones, and that figure is growing quickly. In fact, 60 percent of those who said they got a new device within the last three months chose a smartphone over a feature phone.

For more, check out Nielsen’s Mobile Media Report.

Just a few years ago, a major bank predicted that Indonesians would, on average, earn US$3,000 per capita by 2020. At the beginning of 2011, Indonesia hit that mark, beating the prediction by nearly a decade. While other countries in the region and around the globe have been affected by significant economic uncertainty, Indonesia’s economy is running at full bore, with a rapidly expanding middle class that is now the third-largest in the world. At 48 percent of the population and accounting for 44 percent of all FMCG spending in the country, middle class consumers are shaping today’s retail scene. Recently, during its 35^th Annual Marketing and Media Presentation in Jakarta, Nielsen provided nearly 1,000 clients and stakeholders with a snapshot of what Indonesia’s middle class is doing in terms of media usage and shopping patterns, and how companies can reach them effectively.

While all income groups have benefited from Indonesia’s accelerated growth, the middle class has enjoyed the most rapid advances in terms of spending increases and quality of life improvement, and increased demand in a range of consumer categories from home electronics and appliances to health and beauty products. The Indonesian middle class prefers to combine the convenience and fresh offerings found through traditional retail channels such as wet markets with the price-savings and expansive product offerings of the modern trade.

What are middle class Indonesians buying?
Some key facts about middle class shopping trends that retailers and manufacturers need to consider include:

• Fresh food makes up 37 percent of their monthly spending. Ice cream, noodles, and biscuits are the biggest movers thanks to product innovations.
• Value for money is key for nearly all (97%) middle class shoppers.
• 88 percent of middle class consumers said they want to experiment with brands.
• More than half (53%) shop in a modern trade outlet twice a month.
• They tend to visit the minimarket closest to their home, but promotions can disrupt their regular routine: 90 percent are looking for stores “with attractive and interesting promotions.” They also desire a diverse assortment of goods, friendly service and a comfortable environment.
• Mini-markets see the highest levels of spending, followed by supermarkets, with traditional retailers still highly important for fresh foods and the location convenience they offer.

What are middle class Indonesians watching?
Indonesians of all income levels love to watch TV, and nearly all (95%) middle class homes own a TV, with 96 percent watching programs every day. Other traditional media such as radio and newspapers are also popular, but are increasingly being consumed online, a trend driven primarily by Indonesian youth.  Internet usage and mobile phone ownership are surging, each increasing every quarter. Mobile penetration is already high, and purchase intent for smartphones is strong. These devices are fast becoming the primary platform for a variety of activities, such as watching video, accessing the Internet and connecting to social networks, opening a space for marketers and content providers to focus their efforts to include mobile in their content distribution. Nevertheless, relevancy and convenience to the consumers remain key to mobile content distribution.

Key media usage trends for middle class Indonesians include:

• Middle class Indonesian households watch an average of 4.5 hours of TV a day. Sports programming is the most popular, followed by drama series and other entertainment genres.
• Local content is appealing to middle class, which is why each city has its own newspaper.
• Almost a quarter (22%) of middle class consumers have Internet access, and spend 1.5 hours a day accessing the internet.
• Nearly three-quarters of middle class consumers in major cities (71%) have a mobile phone, with almost half saying they use the devices to access the Internet. More than one-third (35%) have a smartphone.
• Indonesians love social networking: 94 percent are connected to social networks, and 89 percent have a Facebook account.

Reaching the middle class
Given the abundance of opportunities in the marketplace, how can retailers, manufacturers, marketers and media companies connect with the middle class consumer? In a number of consumer goods categories, innovation has proven to be a growth engine. For example, in the ice cream category, the number of new varieties has surged by nearly 32 percent, with single packs the driver of sales. Volume sales of snack noodles surged 92 percent in the past year, thanks in large part to new flavors and a repositioning of the category (what used to be seen as a basic meal now is a great, convenient snack). The instant coffee market has expanded, and middle class consumers contributed 71 percent of volume growth within that category.  In contrast, categories that presented few innovations saw slower growth.

In addition to innovation, other trends seen among Indonesia’s middle class consumers include:

• Kids playing a role in modern shopping: 95 percent said that they “hardly ever refuse” the invitation from their kids to go to the minimarket.
• Convenience is key: today’s middle class consumers are pressed for time, with the demands of work and family life. Products that make life a bit easier are clear winners.
• Appeal to the fact that they are smart shoppers: Indonesians know how much items cost and where they are located in the store. Retailers must create a welcoming environment, promote value for money and win customers’ loyalty.
• Connect with consumers: they are increasingly online, and they discuss brands and products in that space. Retailers must strive to engage with them on social networks.
• Be relevant: tailor marketing – especially online and mobile campaigns – to consumers and their need-states.

Among tablet and smartphone users who downloaded only free apps in the past month, 33 percent chose games, 20 percent chose social networking and 18 percent chose music. However, app downloaders are willing to shell out money. Consumers who downloaded just paid apps or a combination of free and paid apps invested the most in games (35%), maps/navigation (29%) and music (27%).

For additional insights on consumer electronics and media usage, download Nielsen’s State of the Media: Consumer Usage Report.

The Global Consumer Confidence Survey, established in 2005, tracks consumer confidence, major concerns and spending intentions among more than 28,000 online consumers in 56 countries. Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism. Consumer confidence fell globally from 89 to 88, down for the seventh consecutive quarter. “We’ve been on a roller-coaster ride, with a lot of ups and downs and screaming along the way and the ride is not over yet,” said Carman Allison, director of consumer insights, Nielsen. “We’re about to hit another turn.”

Employment is Up – But So is Pessimism
A key component of national confidence is how Canadians perceive the job market. Fifty four percent rated job prospects as good or excellent, better than the global average (43%), but down from 58 percent in Q2 of 2011. Canadians also continue to grow more negative about how they view their personal finances. Globally, 51 percent of respondents felt good or excellent about the state of their finances over the next 12 months. That’s up one percent from the Q2 survey. Yet Canada trends in the opposite direction, with 54 percent of Canadian respondents rating their finances as good or excellent, down from 61 percent just three months earlier. “Canadians may be feeling more optimistic than the global average, amidst some positive economic trends in this country over the past year. Yet a combination of recent factors, such as rising prices of goods, stock market turbulence and bad economic news from the U.S. and Europe, are affecting consumer confidence,” noted Allison.

Discretionary Spending Flat
When asked what they are doing with spare cash, 37 percent of Canadians said they direct spare cash to paying off debts and another 30 percent pour it into savings. “Households are showing increasing fiscal responsibility. Spending is also hampered by this new reality; almost one-quarter of consumers (23%) report that no spending money remains after they’ve paid for the essentials,” Allison said.

• For more insights, download Consumer Confidence: A Canadian Perspective – Q3 2011

Thirteen of the 21 countries have seen volumes decreasing with only Belgium, Norway and Turkey posting healthy volume growths. Growth is still generated in the main by price inflation: UK, Finland, Hungary, Denmark, Portugal, Sweden, Czech Republic and Italy completely rely on price to produce any growth.

For more country-by-country insight and a look at consumer confidence, download Nielsen’s European Growth Reporter Q3 2011.

The growth rates of disposable resources in rural Russia are impressive. Even considering inflation rates of 8.8 percent (both in 2009 and 2010), real disposable resources of rural households grew by about 10 percent since 2008. Rural Russia is transforming. And this has awakened the interest of marketers looking for expansion opportunities.

Signs of Growth
If the maturity of telecommunication infrastructure is one of the key growth indicators for market development today, Russia’s rising Internet and mobile phone penetration rates show positive signs. Since 2009, the number of Internet users in Russia increased 30 percent, according to the International Telecommunications Union.

And while the highest Internet penetration of users is still found in urban Russia, development of Internet usage in rural Russia is growing rapidly. Growth rates in rural households are almost twice as high as in urban homes, which can be attributed to the recent deep transformations in rural Russia.

A Changing Retail Landscape

Retail infrastructure in rural and urban Russia differs considerably—an important factor when considering marketing and distribution strategies. There are almost twice as many retail outlets in urban Russia than there are in rural regions. And while the majority of retail stores in rural Russia are introduced as minimarkets and food stores of traditional trade, an interesting dynamic is emerging as growth rates of modern trade formats in rural Russia are high and they sometimes even surpass modern trade development in urban Russia.

In 2011, two of the biggest retail chains announced plans for further expansion in small communities. Expanding the modern trade universe in rural Russia will offer tremendous potential for FMCG-businesses to establish positions in the rural market.

And while the establishment of a strong market position in the rural landscape can be challenging due to logistical distribution difficulties, rural Russia is not an isolated part of the market. Market concentration levels in rural Russia, as well as the main market players for the majority of categories analyzed by Nielsen, are generally similar to the urban market, indicating that rural Russia is aligned with—not separate from—urban Russia.

The Battle for Shelf Space
Most retail outlets in rural areas are traditional stores and the sales area is typically limited, which makes the distribution of goods a battle for shelf space. To succeed, a deeper understanding of rural consumer demand is necessary.

Given the restricted shelf space in rural Russia, an increase in the number of brands and SKUs in retail outlets is limited. Increasing share in rural areas is mainly possible through product range streamlining and replacing brands and SKUs with new ones that are in higher demand. It is becoming increasingly important to better understand how rural and urban consumer choice differs. A comparison of the top 10 SKUs in urban and rural Russia suggests at first glance that consumer choice does not differ much.

On average seven out of the top 10 SKUs are the same in rural and urban Russia. However, the penetration of brand leaders in the urban market is significantly lower in rural Russia. This disparity between the demand of rural consumers and the supply of rural Russia generates a potential for those manufacturers who are able to enter the market with the product range that can satisfy the unmet demand of rural consumers.

“Fair” Price
As the average disposable resources of rural households per household member are only about 60 percent of those in urban households, rural consumers are price sensitive. However, a shopper in a rural store actually pays from one to 11 percent more than they would in an urban store. More challenges for direct distribution, a longer supply chain and higher transportation costs drive prices up in rural stores.

First-in Advantages
In the days of high competition, being proactive is one of the main secrets to success. The first to seize new opportunities will likely also be the first to profit the most. Rural Russia is no doubt a challenging market to satisfy, but it is also big and changing. And change always offers new opportunities to those who can see the latent and emerging demand and are proactive enough to satisfy it first.

To track the evolution of the store circular, one need only follow the smudge. A Nielsen survey of 11,000 shoppers found that roughly 60 percent of consumers look at printed circulars at least once a week, but today’s fingerprints are increasingly likely to be found on tablet and smartphone screens as opposed to the pages of paper circulars.

Retailer e-mails are just as likely to reach consumers as the paper circular, and millenials in particular are increasingly likely to view a store’s website on a PC, and are more likely than other demographics to use a social media website or smartphone as an alternative to the paper circular.

While a full 70 percent of shoppers have expressed a desire to have their circulars delivered digitally in some form – via e-mail or over the web – in total only 18 percent of shoppers have ever used a smartphone to determine what’s available in-store and only 33 percent have accessed that information on a tablet device. In contrast, 90 percent of shoppers still want paper delivery. Thus, the transition to digital circulars is expected to be gradual, a gentle migration that will accelerate in proportion with both shoppers’ and retailers’ level of comfort with electronic platforms.

For more information, download the Evolution of Circulars (Q4 2011) report, and watch the accompanying webinar.