Consumer Confidence Tracker October 214 PREPARED BY: Luke Reaper and Ciara McCarthy Behaviour & Attitudes J.5272
Introduction 2
Introduction This report presents the findings of the September 215 phase of the Behaviour & Attitudes Consumer Confidence Tracker. Survey results for this phase are based on a sample of 1,9 adults aged 16+, quota controlled in terms of age, gender, socio-economic class and region to reflect the profile of the adult population of the Republic of Ireland. All interviewing on the survey is conducted on our fortnightly face-to-face Barometer by trained members of the B&A field force working under ESOMAR guidelines. Fieldwork on the latest wave was carried out between 24 th September 3 rd October, 214. 3
Summary On a macro-level, we are seeing continuous improvements being made: house prices are increasing in both Dublin and Outside Dublin, the economy is growing at the fastest rate in 7 years, and the confidence of consumers has surged to an 8 year high. Unemployment levels have decreased since the previous wave once again, with the current rate now standing at 11.1% (-1.5 points vs. the same period last year). CONSUMER CONFIDENCE RESULTS Looking forward at the Irish economy, we have remained in positive territory for the third time in a row. Those living in Dublin are still registering more positive scores overall. However, the gap is tightening (and those living Outside Dublin have finally entered positive territory). Outlook on personal finances has dropped this wave and has returned to negative territory again following two consecutive waves of positive scores. Personal Finances: Both those living in Dublin and Outside Dublin feel equally as concerned about their personal finances going forward. In terms of saving ability, we seem to have stabilised somewhat (however we remain in positive territory). Those living Outside Dublin are less inclined to save throughout the oncoming year. 4
Summary Expectation of personal asset value going forward has seen improvements again this wave (+6% increase overall). Outside Dublin, in particular, showed the greatest level of improvement overall and increased by +4% since July 214. Propensity to purchase in the oncoming year remained in negative territory this wave. However trended data shows that gains are being made over time (and we are increasingly nearing positivity). Disposable income levels have increased by + 6.53 per week this wave vs. last. Dubliners and ABC1 s continue to have the most amount of disposable income overall. 5
The Macro Context: Growth and Improvements in Sentiment 6
On a Macro-Level, Optimism is Evident Irish economy growing at fastest rate in seven years. The confidence of consumers has surged to an eightyear high. Ireland is 1 of 4 EU Member States with high and improving industrial competitiveness. Consumer sentiment expected to strengthen ahead of the Christmas trading period. Asking prices outside Dublin rise by 7.6% vs. Q2 of 213. 59% of properties now selling within four months, in comparison to 39% two years ago. Source: Quarterly National Accounts (Sept. 214), KBC Bank Ireland/ESRI Consumer Sentiment Index (Oct. 6 th, 214), European Commission (Aug. 214), Retail Excellence Ireland, (Oct. 214), and The Daft.ie House Price Report, (Oct. 6 th 214). 7
Irish economy growing at fastest rate in seven years Source: Quarterly National Accounts (September 214).
At a Macro Level, Improvements to Ireland s Domestic Economy are evident 4. 3.5 GDP GNP 3.5 3. 2.7 2.5 2. 1.5.9 1..5. -.5 -.6-1. -1.5-1.3-1.5-1.5-2. -2.5-3. -2.7-2.8-1. -.9-1.1-1.5-1.3-2.4-2.8-1.9 2.2 1.8.9.7.8.3 -.4-1.2 1.7 1.5.6.1 -. -.4-1.3.6.7.4.2 -.3-1.7-2.3 2. 1.6 1.5 1..2 -.1-1.1-2.3-3.5-4. -3.6-3.3 28 29 21 211 212 213 214 (FORECASTED TOTAL) Ireland s GDP experienced positive growth during Q2 and Q3 213, GNP also improved in Q3 213. In 214, GDP is forecasted to increase by 3.5%. Source: CSO Estimates as of 14th May 214/EY Economic Eye Summer Report (213)/ESRI Quarterly Commentary (213)/Davy Morning Equity Briefing (August 13th 214)/Central Bank of Ireland Quarterly Bulletin Q2 214 9
The Live Register and The Unemployment Rate The Live Register Unemployment in Ireland -9.5% Overall Change vs. September 213 145,231 224,819 2 15 1 5 14.6 14.7 13.6 11.7 11.5 11.1 211 212 213 Apr '14 July '14 Sept '14 9.6 215 (f) 8.6 216 (f) 11.1% Current Rate of Unemployment (-1.5 percentage points vs. Sept. 213) -6.1% vs. Sept 213-11.5% vs. Sept 213 Source: CSO Estimates as of October 2 th, 214. 1
The Live Register 5 45 449,6 448,6 426,425,4 434,7433, 438,8439,2439,2436, 438,3 436,435,2 432,3428,8426, 414,3 46,2398,3392,7 44,515 4 35 351, 371, 37,5 3 25 2 15 136,962 198,4 186,3 166, 171,3 245,8 278,3 1 5 *Source: CSO latest estimates as of Oct 2 th 214 * The Live Register is not designed to measure unemployment. It includes parttime work e.g. seasonal & casual workers who work up to 3 days per week 11
Consumer Confidence Findings at an 8 Year High 12
Positivity is evident: outside Dublin has finally reached positive territory +7 Dublin Outside +2 Looking Back vs. Looking Forward 6 6 4-2 -2-18 -25-4 -7 2 1-4 -6-8 -74-76 -65-58 -54-5 -74-7 -58-72 -45-59 -64-69 -52-64 -44-5 -56-57 -6-62 -36-39 -44-46 -51-53 -27-31 -1-88 -93-91 -86-81 -82-86 Mar May Sept Nov Mar July Nov Jan Apr July Nov Mar May Sept Nov Feb Apr July Sept Dec Feb Apr July Sep 29 21 211 212 213 214 Source: B&A Consumer Confidence Report Q.1 Q.2 Thinking about the economy as a whole, do you think that the country is better off, worse off, or about the same as last year? And what about the coming year, do you think that the country will be better off, worse off or about the same as this year? 13
The Economy: Looking Forward We remain in positive territory for the third wave in a row Base: All Adults 18+ September 214 % Better off 32 The same 39 Dublin: +7 Outside Dublin: +2 Dublin scores performing slightly worse this wave vs. last. Worse off 28 *Net Diff (GAP) +4% 26 27 28 29 21 211 212 213 Feb 14 Apr 14 Jul 14 Sep 14 Gap = -15-59 -68-49 -58-52 -32-5 +6 +6 +4 Q.2 And what about the coming year, do you think that the country will be better off, worse off or about the same as this year? 16
The Economy: Looking Forward Gap between Dublin and Outside Dublin is increasingly diminishing Base: All Adults 18+ Dublin vs. Outside Dublin 4 2-2 -4-6 -8-44 -52-6 -61-38 -42-32 -3-48 -39-4 -23-2 -36 7-9 16 3 21 The gap between Dublin and outside has diminished somewhat. However Dubliners confidence has dropped significantly since July 214. 2 7-1 Sep-12 Nov-12 Feb-13 Apr-13 Jul-13 Sep-13 Nov-13 Feb-14 Apr-14 Jul-14 Sep-14 Source: B&A Consumer Confidence Report Q.1 Thinking about the economy as a whole, do you think that the country is better off, worse off, or about the same as last year? 18
Personal Finances Looking Forward: Caution is still Evident (Albeit Improving Gradually) Base: All Adults 18+ September 214 % Higher 16 The same 55 Dublin: -12 Outside Dublin: -14 After showing signs of positivity for two consecutive waves, we have returned to negative territory again. Lower 29 *Net Diff (GAP) -13% 26 27 28 29 21 211 212 213 Feb 14 Apr 14 Jul 14 Sep 14 Gap = -15-59 -68-49 -58-52 -32-5 +6 +6-13 Q.3 Do you feel better of financially, worse of financially or about the same compared to last year? 27
Personal Finances Looking Forward x Region Base: All Adults 18+ Dublin vs. Outside Dublin 2 17-2 -25-29 -18-9 -21-23 -12-11 2-13 -11 6-4 2-12 -14-4 -6-34 -33-22 -32 Dubliners have lost confidence in their outlook and have returned to negative territory once again. -8 Sep-12 Nov-12 Feb-13 Apr-13 Jul-13 Sep-13 Dec-13 Feb-14 Apr-14 Jul-14 Oct-14 212 213 214 Q.3 Do you feel better of financially, worse of financially or about the same compared to last year? 3
Savings Looking Forward Base: All Adults 18+ September 214 % More 11 The same 57 Dublin: -13 Outside Dublin: -25 Saving levels have remained unchanged this wave versus last. Lower 32 *Net Diff (GAP) -21% 26 27 28 29 21 211 212 213 Feb 14 Apr 14 Jul 14 Sep 14 Gap -1-5 -34-56 -48-5 -48-4 -33-23 -2-21 Q.8 Do you expect to save more, less or the same amount in the year ahead compared with the last twelve months? 32
Savings Looking Forward x Region Base: All Adults 18+ Dublin vs. Outside Dublin Gap between Dublin and Outside Dublin continues. 2-2 -4-6 -29-5 -46-54 -43-47 -34-53 -35-48 -24-2 -33-4 -25-37 -1-4 -27-27 -13-25 -8 Sep-12 Nov-12 Feb-13 Apr-13 Jul-13 Sep-13 Dec-13 Feb-14 Apr-14 Jul-14 Sep-14 212 213 214 Q.3 Do you feel better of financially, worse of financially or about the same compared to last year? 35
Personal Assets Looking Forward Base: All Adults 18+ September 214 % Higher 19 The same 7 Dublin: +14 Outside Dublin: +6 Those living in Dublin feel considerably more optimistic about their personal assets looking ahead vs. those outside Dublin. Lower 11 *Net Diff (GAP) +9% 26 27 28 29 21 211 212 213 Feb 14 Apr 14 Jul 14 Sep 14 Gap +33 +2-25 -53-43 -41-31 -18-8 -1 +3 +9 Q.6 Do you expect your assets (your house, shares, pension entitlements, savings) In the next year to be higher, lower or the same as in the past year? 36
Personal Assets Looking Forward x Region Base: All Adults 18+ Dublin vs. Outside Dublin Dublin continues its positive trajectory. Outside Dublin has finally left negative territory. 2 17 14-2 -25-29 -18-22 -21-12 -23-9 -11 2-13 -11 6-4 2 6-4 -34-33 -32-6 -8 Sep-12 Nov-12 Feb-13 Apr-13 Jul-13 Sep-13 Dec-13 Feb-14 Apr-14 Jul-14 Sep-14 212 213 214 Q.3 Do you feel better of financially, worse of financially or about the same compared to last year? 4
Purchasing Goods and Services Looking Forward: Improvements are Evident Base: All Adults 18+ September 214 % More 12 The same Less 62 25 Dublin: -1 Outside Dublin: -14 Dubliners feel slightly more confident about spending in the coming year vs. those living outside Dublin (albeit they remain in negative territory). *Net Diff (GAP) -13% 26 27 28 29 21 211 212 213 Feb 14 Apr 14 Jul 14 Sep 14 Gap +7 +5-29 -63-47 -52-45 -37-3 -16-16 -13 Q.7 In the year ahead, do you expect to purchase more, less or the same amount of goods and services as in the past year? 42
Purchasing Goods & Services Looking Forward x Region Base: All Adults 18+ Dublin vs. Outside Dublin 2-2 -4-41 -46-48 -31-34 -21-24 -32-31 -28-33 -9-19 -6-2 -1-14 -6-45 -5-42 -47-42 -8 Sep-12 Nov-12 Feb-13 Apr-13 Jul-13 Sep-13 Dec-13 Feb-14 Apr-14 Jul-14 Sep-14 212 213 214 Q.7 In the year ahead, do you expect to purchase more, less or the same amount of goods and services as in the past year? 45
Balance Of Opinion in Summary The Year Ahead Expectations in regard to asset value, purchases, and savings. Long Term Short Term 4 2-2 -4 6-1 -23 9 21-12 -12-28 -8 31 4-5 33 7-1 2 5-5 -25-29 -34-53 -43-47 -41-52 -5-4 -13-13 -4-2 -39-46 -51-28 -31-33 -4-44 -48-42 -45-52 -21-2 -29-43 -43-4 -44-44 -48-1 -9-8 -29-29 -3-31 -34-33 9 3-1 -16-16 -13-23 -2-21 -6-8 Asset Value Purchases Savings -63-56 -48-5 -1 22 23 24 25 26 27 28 29 21 211 212 213 Yearly Averages Mar May Sep Nov Feb Apr July Sep Dec Feb Apr Jul Sep 212 213 214 Improvements are noted and momentum is slowly improving. However, any further imposition that directly affects real incomes of consumers will impact this area negatively. Growth in personal financial situations continues to be finely balanced. 46
Discretionary Income: Positivity evident, albeit mainly for Dubliners and ABC1 s Base: All Adults 18+ Dublin 58.99 Outside Dublin 47.5 83.97 ABC1 58.51 C2DE 44.82 61.29 62.32 5.94 46.86 43.57 47.8 47.23 51.6 43.66 42.97 43.85 43. 5.47 21 24 28 21 212 Feb '13 Apr '13 Jul '13 Sept '13 Dec '13 Feb '14 Apr '14 Jul '14 Sep '14 Long Term Short Term Q.7 Weekly discretionary income 47
About Behaviour & Attitudes B&A is Ireland s largest and most experienced independently owned research company. We pride ourselves on having the most experienced director team in Ireland. All projects have a director involved. Established over 25 years ago, Behaviour and Attitudes provides a full range of market research services, ranging from CAPI, CATI, online and of course qualitative. Specialist sectors include: Retail & Shopper, Technology & Telecoms, Media, Financial, Political & Social, Polling, Automotive, Healthcare and Public Sector & Utilities. For more information please visit our website at: www.banda.ie or contact us on +353 1 2575. 5