March 07, 2011
Seoul, 7 March 2011: Consumers in Korea said Dining and Entertainment (78%) would be their top purchasing priority for the next six months, according to the MasterCard Survey on Consumer Purchasing Priorities. Besides Dining and Entertainment, Korean consumers responded that Fashion and Accessories (56%), Consumer Electronics (48%), Continuing Education for Self-Improvement (42%), Children’s Education (38%), Fitness and Wellness (37%), and Personal Air Travel (31%) are their top spending priorities in the next six months.
Among Korean respondents, 18% of consumers plan to increase their discretionary spending, 59% of them plan to maintain their level of discretionary spending, and the remaining 23% of consumers plan to decrease their discretionary spending.
The MasterCard Survey on Consumer Purchasing Priorities, released twice yearly, provides valuable insights into consumers’ discretionary spending priorities for the six months ahead. The latest survey was conducted from 13 September to 11 November 2010 and involved 10,502 consumers from 24 markets across Asia/Pacific, Middle East and Africa. Data collection was via internet surveys, personal, telephone and Computer Aided Telephone interviews, with the questionnaire translated to the local language wherever appropriate and necessary. The Survey and its accompanying reports do not represent MasterCard financial performance.
Similarly, consumers across the Asia/Pacific region expect Dining and Entertainment to be their top spending priority for the next six months. 69% of consumers in Asia/Pacific said they would spend on Dining and Entertainment in the next six months, just a percentage point shy of the highest indicated level since the survey began, representing a growth of four points from six months ago.
In all but one of the Asia/Pacific markets included in the survey, Dining and Entertainment was the top spending priority. The top three markets in the region were Vietnam (89%), Korea (78%) and Hong Kong (75%).
The percentage of consumers in Asia/Pacific going to spend on Fashion and Accessories has increased by 6 percentage points to 50% from six months ago. The category is second only to Dining and Entertainment in Australia (50%), New Zealand (53%), Singapore (58%), China (64%) and Vietnam (78%). Another category that grew was Consumer Electronics. Some 43% of consumers surveyed across Asia/Pacific plan to spend on consumer electronics in the next six months, up 6 points from the second half of 2010.
The growth trend in Asia/Pacific for spending priorities in the Dining and Entertainment, Fashion and Accessories and Consumer Electronics categories is supported by the fact that most consumers are planning to maintain the same level of discretionary spending for the first half of 2011 as six months ago. Some 52% of consumers in Asia/Pacific are planning to maintain the same level of discretionary spending, while 19% intend to increase their spending and 29% are planning to decrease their spending. Taken together, these numbers represent the most favorable sentiment in terms of discretionary spending intentions since the survey started collecting this data.
In Asia/Pacific, China (31%), Hong Kong (29%) and India (26%) have the highest percentage of consumers planning to increase their discretionary spending in the next six months while countries with the highest percentage of consumers planning to maintain their level of discretionary spending are Vietnam (62%), Australia (59%) and Korea (59%).
Derived from data in the survey, the MasterCard Worldwide Index of Consumer Purchasing Resilience measures how resilient the categories in the survey are to unexpected cutbacks in planned expenditure. A scale of 0 to 100 is used for the Index, with 100 being the most resilient. The more resilient a category is, the less likely there will be a reduction in spending for that category in the event of an unexpected shock to expenditure.
According to the MasterCard Worldwide Index of Consumer Purchasing Resilience, the most resilient category for discretionary spending is private tuition and extracurricular activities for one’s children. The category was the most resilient in half of the markets surveyed, with the highest Index scores for the Asia/Pacific in India (95.7), Vietnam (92.7) and Indonesia (88.9).
Personal Air Travel is the most resilient category in Australia (72.8) and Singapore (64.4). Consumer electronics tops the Index in Japan (68.5), Fitness and Wellness in New Zealand (76.7) while Fashion and Accessories is the most resilient category in Morocco (85.4).
Yunsok Chang, group executive, Global Products and Solutions, Asia/Pacific, Middle East & Africa, MasterCard Worldwide, said “While it is no surprise that dining and entertainment is at the top of consumers priorities again, it is interesting to see continued positive movement in terms of priorities for the three top categories for the third year running – this is in line with regional economic sentiment and growth over the last six months. Combined with the data on discretionary spending, which are at the highest levels since the survey began, the latest findings show strong consumer sentiment for private consumption over the first half of 2011.”
 Markets surveyed include Australia, China, Egypt, Hong Kong, India, Indonesia, Japan, Kenya, Kuwait, Lebanon, Malaysia, Morocco, New Zealand, Nigeria, Philippines, Qatar, Saudi Arabia, South Africa, South Korea, Singapore, Taiwan, Thailand, United Arab Emirates and Vietnam.
The MasterCard Worldwide Index suite in Asia/Pacific, Middle East and Africa includes the long-running MasterCard Worldwide Index of Consumer Confidence, as well as the MasterCard Worldwide Index of Women’s Advancement, Online Shopping, Index of Financial Literacy, and the Index of Global Destination Cities. In addition to the Indices, MasterCard’s research properties also include a range of consumer surveys including Ethical Spending and a series on Consumer Purchasing Priorities (covering Travel, Dining & Entertainment, Education, Money Management, Luxury and General Shopping).
MasterCard also regularly releases Insights reports providing analysis of business dynamics, financial policies and regulatory activities in the Asia/Pacific, Middle East and Africa region. Over 80 Insights reports have been produced since 2004.
MasterCard has also released a series of four books on Asian consumer insights, authored by Dr. Yuwa Hedrick-Wong, Global Economic Advisor for MasterCard Worldwide and published by John Wiley & Sons.
MasterCard (NYSE: MA), www.mastercard.com, is a technology company in the global payments industry. We operate the world’s fastest payments processing network, connecting consumers, financial institutions, merchants, governments and businesses in more than 210 countries and territories. MasterCard’s products and solutions make everyday commerce activities – such as shopping, traveling, running a business and managing finances – easier, more secure and more efficient for everyone. Follow us on Twitter @MasterCardNews, join the discussion on the Cashless Conversations Blog and subscribe for the latest news.