Australian Consumer Sentiment Falls to Near 15-year Low

All ships rise on an incoming tide just as even a lazy business can increase sales in a buoyant market.  However the tide is turning.

To quote Roy H. Williams in his memo Buried Treasure, "2008 is shaping up to be an unhappy year for most product and service categories." 

Want some more indicators of the turning tide?

"HIGHER interest rates and rising food and fuel costs have pushed consumer confidence to its lowest level in almost 15 years.

People with mortgages are the least upbeat, but rising food and fuel costs are also making their impact felt.

The latest Westpac-Melbourne Institute consumer sentiment index figures out today show an "extraordinarily large fall" - down  9.1 per cent in March to 88.6 points.

The index, which is based on a survey of 1200 people, is below the 100 level, showing that pessimists outnumber optimists.

A separate survey has found three-quarters of Australians are worried about their ability to pay their bills.

A phone poll commissioned by Veda Advantage showed 75 per cent of respondents had debt repayment anxiety.

Price rises were a concern for 55 per cent of the 1050 people polled, according to the Galaxy Research.

Rising food and petrol costs were a worry for 55 per cent of respondents, with one in two complaining about higher food prices."

The above is an excerpt from an article at www.news.com.au, dated March 12, 2008 03:40pm. Click here to read the full story.

All this points to a tightening of the customer's purse strings.

 

From Wizard Partner Mike Dandridge, "In 2008, customers will increasingly become more selective about where they spend their money, and they’re certainly not expecting to make sacrifices. Close the gap between what your customers want and what you’re willing to give, or your competitors may close it before you."

 

2008 will be an exciting time for the brave business owner. For those who hold their nerve with their advertising and improve their customer's experience, it will be a chance to grab market share (even though the total market potential may contract).

 

Will you be one of the brave?