ROCKVILLE, MD--(Marketwire - March 23, 2009) - MarketResearch.com has announced the addition of Mintel International's new report "Consumer Reaction to the Credit Crunch-UK," to their collection of Banking & Financial Services market reports. For more information, visit http://www.marketresearch.com/redirect.asp?progid=67618&productid=2092813.

For the last half decade, consumers have been making the most of cheap and readily-available credit, underpinned by the confidence that soaring house prices bring to homeowners. And for the last half decade, if not longer, pundits have been pointing out that this situation simply wasn't sustainable. These pundits have been proved spectacularly right. The sub-prime crisis in the US turned into a worldwide credit crunch. In turn, the credit crunch is set to turn into a severe and prolonged downturn.

In the final quarter of 2008, amid rising unemployment, repossessions and insolvencies, the UK officially entered recession, defined as two consecutive quarters of negative GDP growth.

As far as consumers are concerned, though, it is early days. Unemployment may be rising, but it is well below the levels reached during the last recession. Inflation has started to fall, and base rates have been slashed -- meaning that many mortgage holders will actually be better off. Just how hard is the slowdown hitting the average UK consumer? Which market segments are struggling to make ends meet, and which segments are -- so far -- entirely untroubled by the slowdown?

This report draws on exclusively commissioned consumer research, including a series of online focus groups, to answer these questions. It examines just how consumer behaviour is changing: where they are cutting back on spending; whether the banking collapses have prompted them to switch accounts; the impact on their mortgage payments; and whether insecurity is prompting them to start paying down debts and build up 'rainy day' funds.

The consumer research is backed up by an in-depth examination of the macro-economic factors affecting the economy. The report also identifies where businesses can learn from the last recession,drawing on Mintel's 1993 Out of Recession report and past economic trends.

ISSUES IN THE MARKET
     Key issues covered in the report
     Abbreviations
FUTURE OPPORTUNITIES
     A window of opportunity to attract switching business?
     Security and certainty -- the new watchwords
     Simple products for complicated times
     Life after debt
MARKET IN BRIEF
     The phoney war is over -- we are officially in recession
     Consumers are starting to feel the pinch...
     ...but it's not as bad as some are making out
     Figure 1: Impact of the downturn, December 2008
     Comfortable -- or hard-hit?
     Bank failures not an issue for most people...
     ...but negative equity is starting to take hold
     What happened last time round?
     Figure 2: Worst-hit market segments in the 1990 recession
     Offering security in an uncertain world
     Who will benefit when confidence returns?
     Figure 3: Top spending priorities once consumers are financially
      secure, August/September 1992
BACKGROUND TO THE CREDIT CRISIS
     Key points
     The basics -- what is a credit crunch?
     Timeline -- how the crisis unfolded
     Figure 4: Major financial and economic developments, 2006-08
     From sub-prime to credit crunch
     Shifting the risk
     Contagion spreads...
     ...and household names go to the wall
BROADER ECONOMIC CLIMATE
     Key points
CURRENT MINTEL PROJECTIONS
     Slight revival to be seen at the end of 2009?
     Beyond 2010
KEY MACROECONOMIC INDICATORS
     Base rates plunge...
     Figure 5: BoE base rate and RPI, 2003-08
     ...but what effect will this have on spending?
     Saving the windfall
     Consumers and policymakers at odds?
     Unemployment ticks upwards
     Figure 6: Unemployment levels, seasonally adjusted, 2003-08
THE HOUSING MARKET
     House prices fall further undermine confidence
     Figure 7: Annual house price changes, Nationwide and Halifax
      indices, 2007-08
     Mortgage lending and property transactions tumble
     Figure 8: Mortgage approvals and property transactions, 2002-08
     How will a housing slowdown affect the wider economy?
CONSUMER CREDIT
     Further signs of a new prudence?
     Figure 9: Gross new consumer credit, 2003-08
     An end to consumer denial
     Figure 10: Gross new credit card lending and amount
      outstanding, 2003-08
     Insolvencies jump in the second half of 2008
     Figure 11: Individual insolvencies in England and Wales
      (seasonally adjusted), Q1 2002-Q3 2008
THE IMPACT ON RETAIL SPENDING
     The retail recession to start in 2009?
     Figure 12: Retail sales trends, Nov 2007-Nov 2008
     Christmas -- mixed fortunes
LEISURE -- LITTLE LUXURIES, OR UNNECESSARY SPEND?
     Travel -- the new essential...
     Figure 13: Number of domestic and overseas holidays, 2003-08
     ...but could people cut back on short breaks?
     Small sacrifices to maintain lifestyles
THEN AND NOW -- PARALLELS WITH 1991-95
     Key points
     A debt-driven recession
     Finding comparables
     Last time around -- five quarters in recession...
     Figure 14: Quarterly GDP change, 1986-95 & 2004-08
     ...and a half decade of stagnating property prices
     Figure 15: House price changes, 1986-95 & 2004-08
     Freedom of information
     Short sharp shock -- or a sign of worse to come?
     Figure 16: UK unemployment, 1988-95 & 2004-08
LEARNINGS FROM THE OUT OF RECESSION -- 1993 REPORT
     Maintaining leisure spend -- at the expense of durables
     Figure 17: Worst-hit market segments in the 1990 recession
     Staying in is the new going out (again...)
     New cars and furniture dropped to the bottom of the list of priorities
     Figure 18: Items consumers had postponed buying in the previous
      12 months, September 1992
     Maintaining lifestyle -- as important in 1992 as it is in 2009
     The least affluent were worst-hit...
     Figure 19: Consumers who had category switched in the previous
      12 months, by demographic group, September 1992
     ...but could mortgage holders escape in 2009?
     The young and mortgage holders cut back hardest
     Figure 20: Summary of the main consumer groups category switching,
      by main product markets, September 1992
INDUSTRY INSIGHT
     The common thread
     Less room for investment...
     ...but more for protection?
     Insurance -- shopping around, not cancelling...
     ...although 'luxury' lines could be hit
     A boost for the aggregators?
     Banking -- security to the fore
     Concerns over loan books
     Impact on consumer credit markets
CONSUMER SENTIMENT
     Key points
     It's the economy, stupid
     Figure 21: Change in the leading concerns among UK adults,
      February 2008-January 2009
     Consumer confidence -- which events are shaping confidence?
     Figure 22: UK consumer confidence index, 2002-08
     Making ends meet, not making big purchases
     Figure 23: Spending and saving confidence, March 2001-September 2008
     A break between spending and saving
     Financial activity -- which sectors will win out?
     Figure 24: Savings, investment, borrowing and debt
      repayment -- consumers' expected activity, 2002-08; Quarterly indices
     Consumer credit -- the last throw of the dice?
     Figure 25: Intended consumer credit activities, Q3/Q4 2002-Q3/Q4 2008
     Figure 26: Expected mortgage and property purchase activity,
      Q3/Q4 2002-Q3/Q4 2008
     Savings -- will good intentions translate into activity?
     Figure 27: Intended saving activities, Q3/Q4 2002-Q3/Q4 2008
THE CONSUMER -- FINANCIAL CONFIDENCE AND FUTURE PROSPECTS
     Key point
     Two thirds keep their finances on an even keel...
     Figure 28: Personal financial situation, December 2008
     ...but many are finely poised
     How does reality match up to press coverage?
     Lower earners and the self-employed the first to feel the strain?
     Squeezing family incomes
     No need to panic -- but people can't help but worry
     Figure 29: Financial prospects, December 2008
     Confidence among the better-off
     Figure 30: Financial prospects, by socio-economic group, December 2008
     One eye on retirement
     Figure 31: Financial prospects, by socio-economic group, December 2008
THE CONSUMER -- IMPACT OF THE CREDIT CRUNCH
     Key points
     Have people even noticed the crunch?
     Figure 32: Impact of the downturn, December 2008
     Wide-reaching effects
KEY FINANCIAL GROUPS
     From hard hit to comfortable and confident
     Figure 33: Key financial groups, December 2008
     Group 1: Comfortable and confident (21% of the sample)
     Group 2: Feeling the pinch (52% of the sample)
     Group 3: Fearing for the future (16% of the sample)
     Group 4: Hard hit (11% of the sample)
     Young and old the last to feel the strain
     Figure 34: Key financial groups, by age, December 2008
     Children a major factor
     Figure 35: Key financial groups, by age, December 2008
     The middle classes more likely to be comfortable...
     Figure 36: Key financial groups, by socio-economic status,
      December 2008
     ...but they don't totally escape the downturn
     The South is hit -- but it's not a London-based recession
     Personal loans -- an already troubled sector could get worse
     Buying security
     Figure 37: Product ownership, by key financial groups, December 2008
     When will it end?
THE CONSUMER -- SPENDING AND SAVING
     Key points
     Cutting down on the little luxuries...
     Figure 38: Spending cutbacks over the past six months, December 2008
     Travel could suffer...
     ...but finance stays strong -- on the whole
     Can parents trim spending?
     The strugglers are making the most cutbacks...
     Figure 39: Spending cutbacks over the past six months, by key
      financial groups, December 2008
     ...and are cutting back on core spending
     Holidays and saving plans deferred
     Figure 40: Spending cutbacks over the next six months, December 2008
     Leisure or luxuries -- which industries stand to lose out?
     Figure 41: Spending cutbacks over the next six months, by key
      financial groups, December 2008
     Even the mainstream are cutting back
THE CONSUMER -- SAVINGS AND INVESTMENTS
     Key points
     How many people were caught up in the bank failures?
     Figure 42: Impact of bank failures and bailouts, December 2008
     Flight to safety among older consumers
     Has Government action maintained confidence?
     Figure 43: Impact of bank failures and bailouts, December 2008
     Moving up the investment ladder
     Figure 44: Impact of bank failures and bailouts, by savings ownership,
      December 2008
     Opportunities are still out there
     Long-term investments -- time for a bargain?
     Figure 45: Stock markets and the credit crunch, December 2008
     A comfortable retirement?
     Those in the market are nursing losses -- but considering new
purchases
     Figure 46: Stock markets and the credit crunch, by savings ownership,
      December 2008
     Not only confident about their own financial situation
     Figure 47: Stock markets and the credit crunch, by key financial
      groups, December 2008
THE CONSUMER -- MORTGAGES AND HOUSING
     Key points
     The credit crisis -- putting home moves on hold...
     Figure 48: Impact on the housing market and moving plans,
      December 2008
     ...but still only a minority concern
     A chance to get on the ladder?
     But also the danger of negative equity
     Arrears up among the less affluent
     Remortgaging -- alright for some, a problem for others
     A wave of negative equity among the Hard Hit
     Figure 49: Impact on the housing market and moving plans, by key
      financial groups, December 2008
THE CONSUMER -- INSURANCE AND PROTECTION
     Key points
     Insurance -- an easy target for cost-cutting?
     Figure 50: Impact on insurance and protection products, December 2008
     Looking for a bit of reassurance as the years go by?
     Figure 51: Impact on insurance and protection products, December 2008
     Easy to value insurance when you're comfortable and confident
     Figure 52: Impact on insurance and protection markets, by key
      financial groups, December 2008
WHO CAN WIN IN A SLOWDOWN?
     Key points
     What were the priorities last time round?
     Figure 53: Top spending priorities once consumers are financially
      secure, August/September 1992
     Zopa -- cutting out the banks and beating the base rate
     Innovation -- Apple are giving people a reason to upgrade...
     ...not just to replace
     The new austerity in the food and drink sector
     Drinking your troubles away
     Emerging from the recession -- the strong will prosper
     Car manufacturers need to concentrate their efforts
     Blockbusters and bookmakers -- the way forward for leisure
     Re-packaging the packaged holiday
APPENDIX: CONSUMER SENTIMENT
     Figure 54: How concerns of the British population have shifted over
      the past year/two months
APPENDIX: THE CONSUMER -- FINANCIAL CONFIDENCE AND FUTURE PROSPECTS
     Current financial situation
     Figure 55: Personal financial situation, by demographic group,
      December 2008
     Financial prospects
     Figure 56: Financial prospects, by demographic group, December 2008
APPENDIX: THE CONSUMER -- IMPACT OF THE CREDIT CRUNCH
     Impact of the downturn
     Figure 57: Impact of the downturn, by demographic group, December 2008
     Key financial groups
     Figure 58: Present and future economic confidence and impact of the
      credit crunch, by key financial groups,December 2008
     Figure 59: Key financial groups, by demographic group, December 2008
APPENDIX: THE CONSUMER -- SPENDING AND SAVING
     Figure 60: Most likely cutbacks in last six months, by demographic
      group, December 2008
     Figure 61: Least likely cutbacks in last six months, by demographic
      group, December 2008
APPENDIX: THE CONSUMER -- SAVING AND INVESTING
     Figure 62: Impact of bank failures and bailouts, by demographic group,
      December 2008
     Figure 63: Stock markets and the credit crunch, by demographic group,
      December 2008
APPENDIX: THE CONSUMER -- MORTGAGES AND HOUSING
     Figure 64: Impact on the housing market and moving plans, by
      demographic group -- total population,December 2008
     Figure 65: Impact on the housing market and moving plans, by
      demographic group -- mortgage holders only, December 2008
APPENDIX: THE CONSUMER -- INSURANCE AND PROTECTION
     Figure 66: Impact of downturn on insurance and protection products,
      December 2008
APPENDIX: RESEARCH METHODOLOGY

For more information visit http://www.marketresearch.com/redirect.asp?progid=67618&productid=2092813.