Consumer confidence increased by two points this month, but marketers are warned not to view it as “light at the end of the tunnel” as the situation remains volatile.
Consumer confidence improved marginally in June, as positivity around the general economy increased, but inflation and the threat of rising petrol prices continues to weigh on people’s minds.
The overall index score on GfK’s latest Consumer Confidence Barometer is up two points to -18, with two of the five measures up and three unchanged compared to May.
People’s view of the general economic situation over the past year increased by three points to -43, while consumers’ outlook for the economy over the coming 12 months jumped five points to -28.
Consumer confidence improved marginally in June, as positivity around the general economy increased, but inflation and the threat of rising petrol prices continues to weigh on people’s minds.
The overall index score on GfK’s latest Consumer Confidence Barometer is up two points to -18, with two of the five measures up and three unchanged compared to May.
People’s view of the general economic situation over the past year increased by three points to -43, while consumers’ outlook for the economy over the coming 12 months jumped five points to -28.
However, while Neil Bellamy, consumer insights director at GfK, says this is to be welcomed, he points out these are only marginal improvements. Indeed, both scores are far below where they were in June 2024 (-32 and -11, respectively).
“Any kind of further bad news – economic or geopolitical – will bring weaker consumer confidence,” he tells Marketing Week. “The fact is, we are not yet out of this enormously challenging period of cost of living pressures.”
The only score in positive territory is people’s feelings about their personal financial situation over the next year, which is at 2 – the same score as last month.
People’s views on their financial situation over the past 12 months is also flat at -7, as is the major purchase index, which indicates people’s likelihood to buy big-ticket items, at -16.
“Confidence is still fragile because the dark shadow of inflation is a day-to-day challenge for so many of us,” Bellamy adds. “With petrol prices set to rise in the coming weeks following the escalation of the conflict in the Middle East, and with ongoing uncertainty as to the full impact of tariffs, there is still much that could negatively impact consumers. With so much volatility, now is certainly not the time to hope for the proverbial ‘light at the end of the tunnel.’”
The savings index, which is measured but doesn’t contribute to the overall index score, drops one point to 27.
“We all know we have a fight on our hands, but the good news is we know how to respond,” says Bellamy. “We are highlighting consumer value, delivering targeted messaging and engaging the most cost-effective channels. We are also showing we are on the side of the consumer. That’s the best way forward -by helping customers work through the tough times, and standing by them, we have every chance of enhancing a brand’s loyalty.”
