Is increased consumer confidence good for marketers?

The report, based on the responses of 5,000 consumers in December 2009 found the consumer confidence index is now standing at 52.9, up from 50.6 in November 2009. That is for the current state of the economy. Looking ahead, the Index finds consumers' expectations up to 75.6, that is an increase from 70.3 in November.

"The Present Situation Index, however, continued to lose ground and remains at a 26-year low (Index 17.5, Feb. 1983). A more optimistic outlook for business and labor market conditions was the driving force behind the increase in the Expectations Index. Regarding income, however, consumers remain rather pessimistic about their short-term prospects and this will likely continue to play a key role in spending decisions in early 2010," said Lynn Franco, Director of The Conference Board Consumer Research Center.

What does this mean for marketers? Although the present situation is down marketers, especially e-tailers, can take heart from the fact that the 2009 holiday spend increased 4% (year over year) with consumers spending record single-day amounts. Now, that is for the holiday season, things will likely slow down during Q1 2010. But the fact that consumers shelled out large amounts of cash for the holidays bodes well for the upcoming Valentine's Day, Mother's Day and Father's Day holidays as well as the Easter holiday spend.

For marketers and publishers the Expectations Index also holds promise. Although consumer confidence is down currently, the fact that consumers are encouraged about the future means they will likely be more open to ad messages, offers and campaigns.

Tags: consumer confidence, consumer purchasing, ecommerce, holiday spend, online advertising, online shopping, The Conference Board