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Nielsen: Chinese Consumer Confidence Maintains High in 2014Q1

Contact: Sue Feng,, 010.5812.9195


Convergence found in the Catch-up of Lower-tiers and the Rise of Mid-west China

Mid-Western Consumers Ready to Spend More


BEIJING, CHINA – May 27, 2014 – Chinese consumer confidence in the first quarter of 2014 was measured at the same record high level of 111 points as in the previous quarter, three points higher than the same time period (Q1 2013) the previous year and above the global average of 96, according to findings from Nielsen, a leading global provider of information and insights into what consumers watch and buy.

Though remaining flat this quarter, China maintains a leading position among the world’s six largest economies, which all demonstrated consumer confidence gains. Listed by the level of the increase, overall confidence increased eight points in France (59), six points in the U.S. (100), four points in Germany (99), three points in the U.K. (87), one point in Japan (81).

Consumer confidence in Hong Kong increased six points in Q1 compared with the last quarter of 2013 (to 111), recording the fifth highest index scores among 60 countries measured in Nielsen’s Global Survey of Consumer Confidence.

Fundamentals of Chinese Consumer Remain Strong

 Amid the slowdown in Chinese GDP growth from 7.7 percent in Q4 of last year to 7.4 percent this quarter, Chinese consumer fundamentals remain strong. Besides a robust consumer confidence among Chinese consumers, the healthy growth of disposable income for both rural and urban residents, both on annual or quarterly basis, made it possible for a continuous growth of the overall retail sales in China.

According to Nielsen information, fast-moving consumer goods (FMCG) sales in the Chinese market rebounded back to 8 percent growth in Q1, two percentage points’ increase compared with the same period of last year.

From the durable products perspective, retail sales of both automotive products and communication devices each registered double-digit growth of 12.3 percent and 14.7 percent respectively compared with the previous quarter. Meanwhile, Nielsen’s survey indicates that for Chinese consumers across the country, personal digital appliance tops their shopping lists, and is closely followed by home appliances.

The strong purchase intentions of Chinese consumers reflected in these upbeat trends also contributed to the increasing importance of the service industry to China’s overall GDP, which is essential for the ongoing restructuring of the Chinese economy from the investment led to one domestic consumption driven.

ONE Story of Convergence

The tracking line of the Chinese Consumer Confidence Index shows, for the first time, a trend of convergence, both by city-tier and by region.

From a city-tier perspective, the news is lower tier cities catching up with tier 1 cities in consumer optimism.  From a regional perspective, consumer confidence level is rising in West China, in particular, mid-west China which includes Sichuan, Guizhou, Yunnan, Shaanxi, Chongqing and Guangxi  according to Nielsen’s definition.

  • New-look Mid-west Consumers Ready to Spend More

Nielsen’s latest Chinese Consumer Confidence report for Q1 2014 shows that, after consecutive increases during the last four quarters from 98 points in Q2 2013 to 107 points in Q1 2014, the western region’s consumer confidence is nearing the consumer confidence scores of other regions.

Consumers both in East (-5) and North China (no change) reported the highest confidence index in China of 112 points, followed by the South region at 111 (-1), and the West region at 107 (+4).

Compared with the previous quarter, increases are seen in consumers’ perception about job prospects, which is 11 percentage points up from 66 percent to 77 percent, and about personal finance, that rose from 62 percent to 66 percent.

Nearly 15 years after the Chinese government embarked on ‘Developing the West’ strategy, the infrastructure build-up and investment injected in western China have helped turn this vast territory into a vibrant consumer market.

According to Nielsen information, compared with the year-on-year growth of 7 percent in March for China’s overall FMCG market, the mid-west region recorded a much faster growth of 14 percent, representing 17 percent of China’s overall FMCG retail sales measured by Nielsen.

In particular, for 17 FMCG categories measured by Nielsen, growth in mid-west is at least twice as fast as the national average. In certain categories like juice (14% in mid-west vs. 1% of national average) and toner (31% in Mid-West vs. 12% of national average), the gap is even wider.

As the Chinese consumers move up the consumption ladder, they are ready to spend more.  The key to gaining their wallet share lies in manufacturers and retailers finding the right products, at the right time, and through the right channels to reach these new and eager consumers.

  • Catching Up of Lower-tier Markets

Besides regional convergence, the convergence of consumer confidence in China can also be found among different tiers. In the first quarter of 2014, consumers in tier 2 reported the highest confidence index of 114 points (+2), but closely followed by tier 1 (-3) and tier 3 (unchanged) at 111 points, and then tier 4 at 110 points (unchanged).

As one of the three pillars behind the consumer confidence index, the respondents from Tier 2 to Tier 4 cities demonstrated a similar growing optimism towards job prospects in the next 12 months, with three tiers all fell at or above 65 percent.

Nielsen’s retail data shows that the Tier2-4 cities and rural China contributed to around 90 percent of China’s total retail sales of liquid milk (93%), yoghurt & yoghurt drinks (86%), and functional drinks (90%) — the top three FMCG categories whose growth value contributed to 39 percent of total FMCG growth in the past year.

For both indulgent categories such as chocolate, and functional categories such as facial masks, double-digit growth was registered throughout all cities from Tier 2 to Tier 4, including rural markets.

Similar Key Concerns of Chinese Consumers

The convergence of all-tiers consumers can also be found in their top concerns: according to Nielsen’s survey, health has become the top concern for all-tier city consumers in Q1, which is closely followed by their concern for income. Meantime, all city respondents expressed a growing concern for environmental protection compared with the previous quarter.

It’s these similar and converging aspirations and concerns of Chinese consumers that will finally trigger an even larger consumption market for China, with growing spending online and in emerging channels that bring novel shopping experiences to lower-tier consumers.

About the Nielsen Global Survey

The Nielsen Global Survey of Consumer Confidence and Spending Intentions was conducted Feb. 17 – March 7, 2014, and polled more than 30,000 online consumers in 60 countries throughout Asia-Pacific, Europe, Latin America, the Middle East, Africa and North America. The sample has quotas based on age and sex for each country based on its Internet users, is weighted to be representative of Internet consumers and has a maximum margin of error of ±0.6%. This Nielsen survey is based only on the behavior of respondents with online access. Internet penetration rates vary by country. Nielsen uses a minimum reporting standard of 60-percent Internet penetration or 10M online population for survey inclusion. The China Consumer Confidence Index is the biggest of its kind and is compiled from a separate mixed methodology survey among 3,500 respondents in China covering all tier cities and rural markets. The Nielsen Global Survey, which includes the Global Consumer Confidence Index, was established in 2005.

About Nielsen

Nielsen N.V. (NYSE: NLSN) is a global information and measurement company with leading market positions in marketing and consumer information, television and other media measurement, online intelligence and mobile measurement. Nielsen has a presence in approximately 100 countries, with headquarters in New York, USA, and Diemen, the Netherlands. For more information, visit