1. What is the HPS-CS Economic Sentiment Index?
Hamilton Place Strategies and CivicScience have teamed up to create the HPS-CivicScience Economic Sentiment Index, the first “living” consumer confidence index. It measures U.S. adults’ expectations for the economy going forward, as well as their feelings about current conditions for major purchases. However, unlike other consumer confidence indices, it is updated in real-time. There is no more waiting each month for the latest sentiment. Further, it can interact with virtually any variable captured from consumer respondents. Cross-tabulations by income, education, race, and geography are all possible. Equally possible is crossing consumer confidence with someone’s favorite summer movie, shopping habits, coffee consumption, or anything else one would want to find out.
2. When will it be released?
The index will be publicly released every two weeks on Tuesdays. Each release will show daily results over the two weeks since the previous survey.
3. How does CivicScience collect the data?
CivicScience manages a network of web-based polling applications distributed across third-party websites, social media assets, mobile applications, and a proprietary web portal to engage consumers (“respondents”) in attitudinal research. A strong consideration in the recruitment of participating web assets is the demographic and geographic composition of its visitors.
CivicScience polls deliver three questions to respondents during each session, including two attitudinal questions. The first is designated as an “Engagement” question, designed to compel respondents to participate. The second is a “Value” question, designed to gather deeper insights about the respondent. The third is the “Profile” question, which asks respondents about more general attributes, such as demographics and personality traits. Respondents, who receive no monetary incentive, can view the results after completing all three questions. Each respondent is represented by a profile maintained in the CivicScience system, via a cookie and other aliasing methods, which keeps them completely anonymous but allows any future polling responses to be appended to their profile.
Through its network and methodology, CivicScience collects a high volume of quality responses on a wide-range of topics. The data are aggregated by CivicScience, and then processed for insights using automated data science and data mining capabilities.
4. What are the advantages to this collection method compared to others?
A key advantage to CivicScience’s collection method is that it mitigates biases found in other survey methods. An ever-shrinking proportion of the U.S population is willing to participate in phone surveys, and, because its respondents are not incentivized, CivicScience is able to reach a broader slice of the population than traditional online surveys. Indeed, nearly three quarters of CivicScience respondents do not currently participate in any regular online panels or surveys.
Additionally, CivicScience is “always on” – its system collects responses continuously every day, allowing for the Economic Sentiment Index to be updated in real time and enabling instant responsiveness to major economic and political events.
5. What questions make-up the index and what is the sample?
Throughout the course of each month, CivicScience collects approximately 3,000 responses to five separate tracking questions, developed and tested in conjunction with Hamilton Place Strategies. Those 5 questions are:
- Looking ahead six months, do you think the U.S. economy will get better, stay the same, or get worse?
- Over the next six months, do you think it will become easier or more difficult to find a new job?
- Over the next six months, do you expect your personal financial situation to get better, stay the same, or get worse?
- Given the current state of the economy, is now a good time or a bad time to make a major purchase like a new car or home improvements?
- Given the current state of your local market, is now a good or bad time to purchase a new home?
Each question contains optimistic, pessimistic, and neutral response options.
6. How is it measured?
Any time the index is calculated – either for a fixed time period such as March 2014 or for any custom period such as the previous ten days – the percentage of pessimistic responses is subtracted from the percentage of optimistic responses and converted to a 0 to 100 scale for each question. The Index number represents the mean score for all five questions. If all respondents give optimistic answers to all five questions in a given time period, then the Index will be at 100; if all are pessimistic, then 0.
Further, for each question, U.S. adults are targeted by stratified random sample according to U.S. Census weights for gender, age and region. Post-stratification weights are then used for gender, age, region, and gross household income. The following groups are used in post-stratification for age and income:
- Age: 18-24; 25-34; 35-44; 45-54; 55-64; 65 and older
- Income: Below $25,000; $25,000-$34,999; $35,000-$49,999; $50,000-$75,000; $75,000-$100,000; $100,000-$150,000; $150,000 and over
While income is not incorporated in the initial respondent targeting, historically the average discrepancy across all seven income groups for each question has been less than three percent. Post-stratification is done via iterative survey raking.
An important consideration with CivicScience’s collection method is that the five questions are not necessarily answered by the same respondents within a given month. Each question will have a different group of 3,000 respondents, some of whom will have answered other questions, but most of whom will have not.
The margin of error, in terms of points on the index, is just over one point. For example, if sentiment is measured at 40 in a given month, then we are 95% confident that the true population sentiment value is roughly between 39 and 41.
7. How can I run a cross-tabulation of my choice?
Subscribers can access the CivicScience database which has a wide-range of existing questions you can mine to run cross-tabulations. If the question does not exist, pose it and as responses pile up over time, you will have your cross-tabulation. CivicScience can work with your individual needs to generate response volume in a timely way.
Requests for the ESI Real-Time Beta
The HPS-CS Economic Sentiment Index can be made available in real-time to a select group of beta partners. Beta partners will receive access to a secure website with real-time results and analysis tools, email alerts when numbers shift, and private insights not made available on our public blog. You will also be able to view sentiment data among key sub-populations, such as high-income consumers, frequent retail shoppers, people most likely to buy or lease a new car, or hundreds of other groups.
To request an invitation, sign up here.