The Global Economic Crisis: The Impact On European Consumer Attitudes Towards Financial Services

Publication Date	August 2009
Publisher	Datamonitor
Product Type	Report
Pages	27
ISBN Number	not applicable
Product Code	DAT15362

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Summary

European consumer confidence has been more seriously damaged by the global economic downturn than elsewhere, and the accompanying dampened expectations must be acknowledged when meeting customers' financial needs.

Scope

Detailed analysis documenting European consumers' 'recessionary mindset' and how this influences perceptions about current and future prospects
Insights highlight how the economic downturn has affected emotional wellbeing and financial security in Europe compared to the global average
Detail discussion of what the downturn means for saving and investment products and what must be done to once again engage consumers
In-depth analysis into Europe's growing online banking market's highlighting important opportunities for FS providers

Highlights

Recessionary pressures have caused the European consumer to stand still, uncertain of what move to make. European financial service providers need to take this on board when trying to market their products, reassuring the consumer enough to entice them to make positive changes.

Stress and happiness indictors are important to note as they reveal the state of mind of the European consumer. Faced with the uncertainty of the economic and financial landscape there exists an opportunity for financial services to supply products that provide peace of mind.

Reasons to Purchase

Gain a detailed understanding of changing consumer attitudes amid the global downturn in order to build appropriate recessionary strategies
Assist consumer segmentation and targeting efforts by accessing data from Datamonitor's Global FS Consumer Insight survey

Content

OVERVIEW

Catalyst
Summary

THE FUTURE DECODED

INTRODUCTION: Understanding how recessionary mindsets influence attitudes towards and actual consumption is vital
The recessionary mindset of European consumers has intensified with consumers' widespread belief that they are living in a recession
TREND: Lower consumer confidence is reflected by a generally negative outlook amongst European consumers
Perceptions about the economy, job security and household financial status in Europe have all worsened and there is limited optimism for the six months ahead
European consumers' downbeat forecasts appear to be negatively impacting perceptions of quality of life, with stress levels up and personal happiness down
Stress levels have risen during the financial downturn, and this should be reflected in the financial services offered
INSIGHT: Faced with high uncertainty and low optimism for the future, European consumers embrace the status quo
European consumers experience increased concerns over their financial products yet remain below the global average
ACTION POINT: Financial services providers must meet the anxiety of European consumers for the long term with products and advice geared to alleviate this concern, and target providing support with a personal touch
Europeans do not translate their more pessimistic general outlook into higher concerns around specifics
Increased concerns fail to elicit a significant response from European consumers
ACTION POINT: Financial services providers have a role to play in reassuring consumers and boosting confidence in their wider financial situation
TREND: Confidence concerning one's future personal financial situation influences consumers' financial services decisions
Confidence concerning future household financial security impacts short-term savings
Long-term savings plans are also impacted upon by household financial confidence
INSIGHT: There exists a not inconsiderable segment of consumers that have the means and yet are still reluctant to save, both now and in the long run
Financial services institutions must encourage these key consumer segments to ask themselves: "Can I afford not to save?"
Key consumer segment 1: apathetic consumers
Key consumer segment 2: struggling consumers
INSIGHT: European online banking market reveals untapped potential
Europeans check balances online but fail to make the move to some of the other banking activities
Heavy online use by price-driven consumers and those who are more optimistic about their household finances
ACTION POINT: Online banking interfaces must be improved to provide service and security to rival in-house arrangements

APPENDIX

Additional data
Methodology
Ask the analyst
Datamonitor consulting
Disclaimer
Table 1: Percent likely or unlikely to reduce credit card debt given level of confidence in personal finances
Table 2: Percent likely or unlikely to remortgage given level of confidence in personal finances
Table 3: Average level of response to "I trust my primary bank" given registered/unregistered online
Table 4: Frequency of online banking use by price-driven consumers
Table 5: Frequency of online banking use by consumers who expect to be better off financially
Figure 1: Datamonitor's Recession and Recovery portal will allow industry players to continually identify emerging opportunities and track what is happening in the UK economy as it develops
Figure 2: More than half of European consumers strongly believe that their country is in a recession, which is indicative of a deeper recessionary mindset
Figure 3: Both Europeans and the rest of the world are revealing heightened economic concerns, but Europeans appear particularly hard-hit
Figure 4: Europeans reveal their financial situation has worsened more than the global average
Figure 5: Job security has worsened, with Europeans hit harder than the global average
Figure 6: The unemployment rate is expected to peak in 2010 for most European countries
Figure 7: Consumer expectations for the next 12 months reveal mixed results
Figure 8: Stress levels have increased in consumers' daily lives, with Europeans seeing fewer improvements
Figure 9: Levels of concern before downturn reveal Europeans show less concern across the board
Figure 10: Level of concerns have increased post-downturn, but Europeans remain less troubled than the global average
Figure 11: Some financial services providers have already made marketing promotions focused around rebuilding confidence
Figure 12: European consumers are less likely to undertake all proposed activities over the next six months
Figure 13: Consumers likely to save are more likely to be optimistic about their personal finances
Figure 14: Consumers likely to invest in their pensions are more likely to be optimistic about their personal finances
Figure 15: Four distinct consumer segments have emerged within the savings market
Figure 16: Globally consumers regularly check their online bank balance, but Europeans do so with higher frequency
Figure 17: Consumer interest in other online banking activities reveals some weaknesses in the online banking sector
Figure 18: Consumers highlight branch and security issues as the two main reasons for not using online banking