Consumer confidence drops ahead of budget

Consumer confidence dropped by two points in November, continuing a pattern of low sentiment regarding the economy among the general public.

The Consumer Confidence Index fell to -19 this month, with all the measures making up the headline figure dropping since October. The scores make for gloomy reading ahead of the crucial retail month of December, with consumers clearly feeling downcast in advance of the Labour government’s autumn budget next week.

Over the past 12 months, the Index score has fluctuated between -23 and -17. While scores have fluctuated, with no clear direction of travel, the Index has remained firmly negative, notes GfK consumer insight director Neil Bellamy.

“There’s been no consistency in the direction that consumer confidence is travelling. So much depends on next week’s announcement,” says Bellamy. “Our December results will be out on the 19th, and we’ll see if the grey and gritty Christmas creatives have got the mood music right.”‘The bar has definitely gone up’: How brands are ‘rewriting’ the Christmas playbook

The sharpest fall recorded across the five measures this month was in the major purchase index, something that Bellamy noted is particularly concerning for marketers hoping that shoppers will splurge on large items over Christmas. The major purchase index fell by three points since October.

Meanwhile, sentiment about the general economic situation dropped by one point when looking back over the last 12 months and two points when looking forward to the next 12 months. Consumers are also downcast about their own financial situation, with people’s perceptions of their personal financial situation dropping by two points, both when looking to the next 12 months and thinking about the last 12 months.

With the next six weeks being crucial to so many brands’ fortunes, marketers will be hoping that next week’s budget provides some boost to consumer confidence.