Consumer Confidence in Asia-Pacific: A Mixed Bag

Cautious Optimism in Leading Markets

Consumer confidence is on the decline in leading Asia-Pacific (APAC) markets, according to a recent survey from Ipsos. The survey, which polled over 7,000 consumers across 11 APAC territories, found that consumer confidence for the region declined to a score of 115 in the second quarter of 2023. This marks a significant drop from the previous quarter, when consumer confidence stood at 122.

Key Findings for APAC

• Consumer confidence declined in Singapore (-59 points) and Thailand (-45 points).
• Sentiment rose in the Middle East and Africa.
• Consumer confidence rose in China, driven by optimism among younger generations.

Concerns Over Rising Costs

One of the key factors driving the decline in consumer confidence in APAC is concerns over rising costs. The region has been hit particularly hard by inflation, with many countries experiencing double-digit price increases. This is putting a strain on household budgets and making consumers more cautious about spending.

In addition to rising costs, consumers in APAC are also concerned about the geopolitical situation. The ongoing war in Ukraine and tensions between the US and China are creating uncertainty and making consumers more hesitant to spend.

Cautious Optimism in China

Despite the overall decline in consumer confidence in APAC, China remains a bright spot. The survey found that consumer confidence in China rose to 120 in the second quarter of 2023. This is likely due to the country's relatively strong economic performance and the government's efforts to stimulate consumer spending.

However, it is important to note that consumer confidence in China is still below pre-pandemic levels. The country is facing a number of challenges, including a property market crisis and rising unemployment. These challenges could weigh on consumer confidence in the months ahead.

Conclusion

Consumer confidence in APAC is a mixed bag. Some countries are experiencing a decline in confidence, while others are seeing an increase. Overall, consumers are becoming more cautious and thoughtful about spending. This is due to a number of factors, including rising costs, geopolitical uncertainty, and concerns about the economic outlook.

Businesses in APAC need to be aware of the changing consumer landscape and adapt their strategies accordingly. They need to find ways to win over cautious consumers and build trust. This can be done by offering value for money, providing excellent customer service, and building strong relationships with customers.