JWT AnxietyIndex: Colombia (January 2010)

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The JWT AnxietyIndex was launched in February 2003 during the run-up to the war in Iraq. It tracks the level and intensity of consumer anxiety and the drivers of that anxiety. It examines safety and …

The JWT AnxietyIndex was launched in February 2003 during the run-up to the war in Iraq. It tracks the level and intensity of consumer anxiety and the drivers of that anxiety. It examines safety and security concerns—the threat of terrorism, potential and current military hostilities, crime—as well as economic worries, such as the cost of health care, the cost of living and job security. The AnxietyIndex is also designed to discover consumer insights that will help marketers formulate strategies during times of high or low anxiety.

A quantitative survey was conducted using JWT's SONAR, our proprietary online research tool. We surveyed 253 adults aged 25 and older living in Colombia. The data was collected in January 2010 and was weighted by age and gender.

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  • 1. ANXIETYINDEX COLOMBIA JANUARY 2010
  • 2. AGENDA Background ..............................................................................................................3 Methodology ............................................................................................................5 Executive Summary ..............................................................................................6 What’s making people anxious today? ........................................................9 A closer look at Colombia ..............................................................................20 The recession’s impact on Colombia vs. other countries ................................21 The recession’s impact on lifestyle ................................................................24 Media and the recession ................................................................................33 Shopping behavior and the recession ............................................................39 Looking to the future: The next generation ....................................................42 Brand Opportunities ............................................................................................452
  • 3. BACKGROUND The JWT AnxietyIndex was launched in February 2003 during the run-up to the war in Iraq. It tracks the level and intensity of consumer anxiety and the drivers of that anxiety. It examines safety and security concerns—the threat of terrorism, potential and current military hostilities, crime—as well as economic worries, such as the cost of health care, the cost of living and job security. The AnxietyIndex is also designed to discover consumer insights that will help marketers formulate strategies during times of high or low anxiety.3
  • 4. BACKGROUND (CONT’D.) Colombia - GDP Percent Change 10 6.8 5.2 8.2 5 3.7 3.6 2.5 0 -0.1 % Change -5 2004 2005 2006 2007 2008 2009 2010 (est.) JWT launched the baseline study for AnxietyIndex in Colombia in 2010. Following the global economic downturn, forecasts predict a recession for Colombia in 2010. Source: CIA World Fact Book4
  • 5. METHODOLOGY Quantitative survey conducted by JWT SONARTM, our proprietary online research tool Data collected January 2010 1,253 adults aged 25-plus living in Colombia Data weighted by age and gender5
  • 6. EXECUTIVE SUMMARY6
  • 7. EXECUTIVE SUMMARY Colombia registers a relatively low level of anxiety compared with other countries JWT has surveyed. There are two primary drivers of anxiety in Colombia: Crime: Significant inequality in Colombian society has led to high rates of urban violence and theft. Global warming: Water levels of many rivers and lakes have decreased, and some have disappeared.7
  • 8. EXECUTIVE SUMMARY Some highlights of the AnxietyIndex study: Colombians are most pessimistic when it comes to the cost of gasoline, unemployment and increasing food prices. As far as specific drivers of anxiety, Colombians are most concerned about the impact of global warming. To reduce spending, Colombians are spending more time at home, cutting down on trips to the cinema and leisure activities.8
  • 9. WHAT’S MAKING PEOPLE ANXIOUS TODAY?9
  • 10. Overall anxiety levels in Colombia are relatively low—among the lowest in the world ... 100 10 16 18 90 21 22 22 26 28 30 80 34 35 41 42 45 70 58 60 65 50 90 84 82 40 79 78 78 74 72 70 30 66 65 59 58 55 20 42 35 10 0 Japan Russia Saudi ArgentinaMexico UAE India U.S. Spain Brazil U.K. AustraliaColombiaCanada France China Arabia Brazil: January 2009 % Nervous/Anxious % Not Nervous/Anxious India, China: April-May 2009 Russia, Spain, Japan: March 2009 U.S., U.K., Canada, Australia, France: September 2009 Saudi Arabia, UAE: October 2009 Argentina, Colombia, Mexico: January 2010 Overall, given everything that is going on in the world, the country, and your family’s life,10 how nervous or anxious would you say you currently are?
  • 11. ... and fewer than 1 in 10 say they are “very nervous/anxious.” 50 % Very Nervous/Anxious 40 30 20 38 30 28 26 10 25 25 21 18 16 12 10 9 8 8 7 6 0 Russia India Saudi UAE Argentina Japan Mexico Brazil U.S. Spain France U.K. Australia CanadaColombia China Arabia Brazil: January 2009 India, China: April-May 2009 Russia, Spain, Japan: March 2009 U.S., U.K., Canada, Australia, France: September 2009 Saudi Arabia, UAE: October 2009 Argentina, Colombia, Mexico: January 2010 Overall, given everything that is going on in the world, the country, and your family’s life,11 how nervous or anxious would you say you currently are?
  • 12. ANXIETYINDEX MAP SAFETY/SECURITY ECONOMIC Political Leadership 900 Threat of State of Economy Terrorism FURTHER 600 FURTHER FROM FROM “HOME” “HOME” 300 Potential Military Cost of Health Hostilities Care 0 CLOSER CLOSER TO TO “HOME” Current Military Cost of Living “HOME” Hostilities Crime Job Security SAFETY/SECURITY ECONOMIC12
  • 13. Other than crime, the major drivers of anxiety make Colombians less anxious than most people around the world. Political Leadership Colombia 1000 Global average 900 Threat of 800 State of Economy Terrorism 700 600 500 400 300 200 70 Potential Military 175 Cost of Hostilities 155 100 Health Care 100 0 147 98 120 143 364 Current Military Cost of Living Hostilities Crime Job Security AnxietyIndex: % who are nervous or anxious/% who are not13
  • 14. Even compared with other LATAM markets JWT studied, Colombians are much more at ease. Political Leadership Colombia 1000 LATAM* average 900 Threat of 800 State of Economy Terrorism 700 600 500 400 300 200 70 Potential Military 175 Cost of Hostilities 155 100 Health Care 100 0 147 98 120 143 364 Current Military Cost of Living Hostilities Crime Job Security AnxietyIndex: % who are nervous or anxious/% who are not *Brazil, Argentina, Colombia, Mexico14
  • 15. On specific drivers of anxiety, Colombians stand out in only one area: concern about global warming ... The War in Iraq Impact of Global 800 The War in Warming Afghanistan Colombia Global average 600 Natural Disasters The Housing Market 400 363 Safety of the 200 34 Gasoline Prices Food Supply 33 147 56 69 0 139 72 132 Quality of Products Imported 101 Food Prices 52 68 237 from China 128 The Government’s Unemployment Rates Budget Deficit The State of the Bank Failures National Infrastructure The Stock Market AnxietyIndex: % who are nervous or anxious/% who are not15
  • 16. ... and are generally relaxed compared with their LATAM neighbors. The War in Iraq The War in Corruption 800 Afghanistan Colombia LATAM* average Impact of Global 600 The Housing Warming Market 495 400 363 Natural Disasters 200 Gasoline Prices 34 33 56 147 139 0 Safety of the 69 132 72 Food Prices Food Supply 237 101 52 68 128 Quality of Products Imported Unemployment Rates from China The Government’s Budget Deficit Bank Failures The State of the The Stock Market National Infrastructure AnxietyIndex: % who are nervous or anxious/% who are not *Brazil, Argentina, Colombia, Mexico16
  • 17. In general, Colombians are slightly more optimistic than the global average about near-term prospects of positive change. WORSE BETTER Safety of the food supply -4 1 The housing market Colombia 4 Global average -3 The stock market 8 More optimistic 2 Bank failures 11 More pessimistic 1 Unemployment rates -30 -27 Gasoline prices -53 -34 Food prices -40 -35 The government’s budget deficit -26 -29 % who expect it will get “better” minus % who expect it will get “worse” in the next six months And over the next six months, do you expect that each of the following will get better, stay the same or get worse?17
  • 18. Colombians are split on the extent to which they’re feeling the effects of the downturn. Intensity of Personal Impact from Tough Economic Times 29 37 35 1 2 3 4 5 6 7 8 9 10 Haven’t Have impacted impacted me at all me a great deal No Impact Great Impact % On a scale of 1-10, where 1 means tough economic times haven’t impacted me personally at all and 10 means tough economic18 times have impacted me personally a great deal, how would you rate yourself?
  • 19. Many feel they fared better than their countrymen. Intensity of Impact from Tough Economic Times Impact on Colombia Impact on me = 35 Impact on Me Impact on Colombia = 59 1 2 3 4 5 6 7 8 9 10 Haven’t Have impacted impacted me at all me a great deal No Impact Great Impact % How would you rate the impact of the recession on your country?19
  • 20. A CLOSER LOOK AT COLOMBIA20
  • 21. THE RECESSION’S IMPACT ON COLOMBIA VS. OTHER COUNTRIES21
  • 22. Most think Colombia has fared about the same or better in the recession than other Latin American countries ... Impact of Recession on Colombia vs. Other Latin American Countries 70 60 50 50 43 40 30 20 10 7 0 My country has been My country has been My country has been LESS MORE affected than other affected ABOUT THE SAME affected than other Latin Latin American countries as other Latin American countries American countries % Thinking about the effect of the global economic downturn on your country, do you think your country has been affected more, less, or about the same compared to other Latin American countries?22
  • 23. ... and almost 6 in 10 say Colombia has been less affected than “wealthier” countries. Impact of Recession on Colombia vs. Richer Countries 70 60 59 50 40 30 22 20 19 10 0 My country has been My country has been My country has been LESS MORE affected than affected ABOUT THE SAME affected than richer countries as richer countries richer countries % Thinking about the effect of the global economic downturn on your country, do you think your country has been affected23 more, less, or about the same compared to richer countries?
  • 24. THE RECESSION’S IMPACT ON LIFESTYLE24
  • 25. Colombians consider ivory-tower politicians, class inequalities, crime and corruption as the primary social impacts of the recession. % who agree Politicians in my country are out of touch with how the average person is being affected by the 77 global economic downturn I worry that the global economic downturn is widening the economic gap between the rich 76 and the poor in my country I’m worried that crime in my neighborhood will increase as people fall on hard times 75 Government corruption in my country is as bad as it has ever been 67 My social class is being dealt an unfair blow because of this global economic downturn 64 I have started to notice that the values in my country have changed a bit as a result of the 57 global economic downturn The economic crisis has brought me closer to my friends and family 35 The economic crisis has distanced me from my friends and family 20 % How much do you agree or disagree with each of the following statements?25
  • 26. Behavior-wise, people are retrenching to their homes ... Changes in Social Behavior as a Result of the Downturn 4 Going to concerts/theatre 45 51 6 Going out to the movies 54 40 2 Going out to clubs, bars 38 60 7 Going out to eat 50 43 5 Going out shopping 43 52 4 Going out to parties/events 45 More 51 Same 46 Less Spending time at home 48 6 % Some people have told us that recently they have made some changes in how they are spending their time. Looking at the list of activities below, are you doing each more often, less often, or about the same amount as you did before the global economic downturn?26
  • 27. ... especially women. % Doing Activity LESS by Gender 55 Going to concerts/theatre 47 42 Going out to the movies 38 61 Going out to clubs, bars 58 48 Going out to eat 37 61 Going out shopping 43 46 Going out to parties/events Women 44 Men % Some people have told us that recently they have made some changes in how they are spending their time. Looking at the list of activities below, are you doing each more often, less often, or about the same amount as you did before the global economic downturn?27
  • 28. As one might expect, people are spending more time at home primarily to cut back on spending. Why People Are Spending MORE Time at Home To cut back on spending 74 I want to spend more time with my family 45 There seems to be less going on (parties, concerts, etc.) 15 Because most of my friends are 12 I improved my home entertainment/bought new items for home entertainment 12 Because of crime in my neighborhood 5 % You mentioned that you have been spending more time at home recently. What are the reasons you have been spending more time at home?28
  • 29. Crime is a prime driver of anxiety ... How concerned are you about crime in your neighborhood? 60 67 50 45 40 33 30 25 22 20 10 8 0 Very Somewhat Not very Not at all concerned concerned concerned concerned % Now, we’d like to talk to you about crime in your neighborhood. How concerned are you about crime in your neighborhood?29
  • 30. ... and it appears that the downturn may be contributing ... How has your concern about crime changed over the past year? 80 70 60 54 50 40 40 30 20 10 6 0 Increased Stayed the Same Decreased % Thinking about the past year, has your concern about crime in your neighborhood increased, decreased, or stayed the same?30
  • 31. ... though crime-related anxiety is not impacting the daily lives of many. Has your routine changed due to concerns about crime? 80 Women 70 70 Men 66 60 50 40 34 30 30 20 10 0 Yes No % Have you changed your routine at all due to your concern about crime in your neighborhood?31
  • 32. Those who have changed their routine have adopted coping mechanisms impacting various areas of their lives, from shopping in different areas/stores to showing less bling to going out less often. Has your routine changed due to concerns about crime? Not wearing certain pieces of clothing or 65 accessories so I don’t attract attention 54 58 Choosing to shop in different areas/stores 60 Not going out at night 53 50 Going out less often than I used to 45 50 Making sure that when I am out, I am not alone 49 39 Choosing different methods of transportation 30 36 Buying fewer luxury items 31 34 Women Entertaining myself and friends at home so I 14 Men don’t have to go out as much 16 % Among those who have changed their routine due to concerns about crime And how or what have you changed?32
  • 33. MEDIA AND THE RECESSION33
  • 34. As in most markets, people understand the downturn as much as it affects them but don’t possess an in-depth understanding. Knowledge of the Global Economic Downturn 60 59 50 40 32 30 20 10 9 0 0 I know a lot I know a fair I’ve heard of it, I’ve never about it amount about it but that’s about it heard of it % How much would you say you know about the global economic downturn?34
  • 35. Colombians get their news through several sources, primarily TV and the Web ... % of people who use source for news at least once a day 100 90 87 80 70 65 70 63 60 50 40 30 20 10 0 TV Online Radio Newspaper % About how often, if at all, do you get your current news and information from each of the following?35
  • 36. ... which have been a source of information about the downturn. % of people who saw news about the downturn through their usual news and information sources 100 90 94 Women 80 90 Men 70 60 50 40 30 20 10 6 10 0 Yes No % Have you watched/read/heard reports about the global economic downturn from your usual news and information sources?36
  • 37. Most Colombians feel the media has covered the downturn in the right proportion. If anything, there’s been a bit more coverage than they’d like. Has the media coverage of the downturn been ...? 80 70 63 60 50 40 30 22 20 15 10 0 Too Little Right Amount Too Much % And do you think the media has been giving reports about the global economic downturn too much, too little, or just enough coverage?37
  • 38. But nearly half are unaware of predictions that Latin America will enter a recession this year. Awareness of reports that Latin America will enter a recession in 2010 80 70 60 55 50 45 40 30 20 10 0 Yes No % Are you aware of the recent reports that Latin America will enter a recession in 2010?38
  • 39. SHOPPING BEHAVIOR AND THE RECESSION39
  • 40. In the past year, most people have taken some steps in response to the global downturn—though these are more passive than active. Actions taken as a result of the global downturn Paying closer attention to prices while I’m shopping 68 More actively looking for items on sale 64 Doing more comparison shopping to make sure I get the best price 58 Buying only when I am close to running 52 out of something Buying more store brands/private label brands 41 Shopping more at discount or less expensive stores 39 Switching to lower priced brands 30 Buying smaller amounts of items, more often 19 I haven’t changed my spending habits as a result of the recession 17 Using more coupons 15 Buying more in bulk 7 % Now, we would like to talk to you about your shopping over the past year. Please take a moment and think about how your spending habits have or have not changed over the past year when it comes to what you buy for your household (i.e., groceries, supplies, etc.). Which of the following, if any, have you begun to do as a result of the global economic downturn?40
  • 41. Defensive recessionary behavior seems yet to have gripped Colombians. % who agree strongly I have started to cut back on things I don’t need 46 I have noticed my friends have cut back in their spending habits 28 I worry that because of the global economic downturn I won’t be able to keep up the lifestyle I am used to 24 I worry that because of the global economic downturn 20 I won’t be able to attain the lifestyle I want I haven’t personally felt the effects of the recession but have modified my spending habits just in case 18 The recession hasn’t really changed what I do in my everyday life 17 % How much do you agree or disagree with each of the following statements?41
  • 42. LOOKING TO THE FUTURE: THE NEXT GENERATION42
  • 43. While only about half of Colombians are generally anxious, 8 in 10 are anxious about the world their children and their children’s children will inherit ... % of people anxious about themselves vs. anxious about the future for their children/grandchildren 100 90 79 80 70 58 60 50 40 29 30 20 10 7 0 Anxious about Anxious about Very Anxious Very Anxious about themselves their children/ about themselves their children/ grandchildren grandchildren % Among those who have children Given everything that is going on in the world, the country, and your family’s life, how nervous or anxious would you say you are about the world your child(ren) or grandchildren will inherit?43
  • 44. ... which tends to manifest in financial concerns. % agreeing strongly or somewhat I worry about the effect this economy will have on the ability of my child(ren) to find a good job 76 I worry about my ability to afford the type of education 76 I’d like for my child(ren) I worry about my retirement funds and that I may 71 someday have to rely on my child(ren) for help This is a good lesson for my child(ren) about living 66 within your means I’ve lived through recessions before, and so did my parents—my child(ren) will be just fine 43 The schools are doing a good job of teaching my 34 child(ren) about the recession % Among those who have children How much do you agree or disagree with each of the following statements?44
  • 45. BRAND OPPORTUNITIES45
  • 46. BRAND OPPORTUNITIES The Chinese character for “crisis” contains two characters to be read concurrently: danger and opportunity. More than being seen as a barrier, the crisis is regarded as an opportunity that some companies can capitalize on.46
  • 47. BRAND EXAMPLES BCSC: Helping people to save again While the global economic crisis has affected Colombia, few brands seem to be trying to reduce the level of anxiety among consumers. A notable exception is Banco Caja Social BCSC (“Your friendly bank”), which has created a product that meets the needs of customers in this recession. Maintaining a savings account in Colombia is expensive, with various fees and charges, so BCSC launched a free account and added incentives for customers to meet savings goals. A print ad says: “Let’s celebrate that we can finally start saving again.”47
  • 48. BRAND EXAMPLES Sedal: Giving women what they wanted but could not afford This hair brand developed a promotion for Colombian women based on the insight “I have no reason to wait until the crisis passes to make and take what I’ve always wanted.” The target was women whose ideal role in life is to study, work and engage in the home. Women had to send three Sedal labels to enter in a weekly drawing; prize money was awarded for spending on clothes, to study, to travel or to buy housewares.48
  • 49. BRAND EXAMPLES CODENSA: Credit for all The energy supplier in Bogotá, Codensa, decided to venture into the financing of appliances, creating Crédito Fácil Codensa (Easy Credit Codensa), a program aimed at low socioeconomic levels. The idea is to improve quality of life, giving people the opportunity to get things they’ve always wanted but were unable to afford outright, especially not during an economic crisis. Participants can pay for more than 120 brands of household products through their Codensa energy bill, in up to 48 installments.49
  • 50. THANK YOUMark Truss Alexandra Suarez Ann M. MackDirector of Brand Intelligence Market Research Director Director of TrendspottingJWT Worldwide JWT Latin America JWT Worldwidemark.truss@jwt.com alexandra.suarez@jwt.com ann.mack@jwt.com www.AnxietyIndex.com (c) 2010 J. Walter Thompson Company. All Rights Reserved.