Shopping: Tariff turmoil compounds cost-of-living pressures
- InsightTrendsWorld
- May 5
- 8 min read
Why is the topic trending?
Global Concern over Tariffs: The article highlights a significant global concern (76% of people) regarding the personal impact of tariffs, adding to existing worries about the cost of living.
Compounding Economic Pressures: Tariffs are presented as an additional factor exacerbating already heightened anxieties about the economy and inflation.
Consumer Behavioral Changes: The study reveals that consumers are already making or considering lifestyle and shopping changes in response to rising prices and the potential impact of tariffs, including boycotting US products.
Impact on Household Budgets: A significant portion of the global population is finding it challenging to meet their basic monthly household budgets, and tariffs are expected to worsen this situation.
Brand Response Strategies: The article offers insights into how brands can respond to these consumer concerns and navigate the challenges posed by tariffs and economic uncertainty.
Overview:
The article discusses the findings of Kantar's Consumer Sentiment Barometer, a study of over 10,200 people across 20 countries, which reveals widespread concern about the impact of tariffs on personal finances, compounding existing anxieties about the cost of living. While the economy and inflation remain the primary worries, tariffs are seen as an additional burden in a volatile global landscape. The study indicates that consumers are already reacting to rising prices by making lifestyle changes, seeking price reductions, trading down to cheaper stores, and considering boycotts of US products. The article also provides advice for brands on how to navigate this environment by maintaining advertising, being clear on pricing, prioritizing customer experience, and responding to evolving emotional needs.
Detailed Findings:
Global Tariff Concern: 76% of people globally are concerned about the personal impact of tariffs.
Main Worries: The economy (88%) and inflation (85%) remain the top concerns globally.
Blame for Price Rises: 62% blame economic policies for price increases.
Lifestyle Changes: 86% are making lifestyle changes due to rising prices, including considering US product boycotts.
Budget Challenges: 32% say meeting their monthly household budget is more challenging than last year, and 45% are unable to or struggling to meet basic household commitments.
Pessimistic Economic Outlook: Only 25% of people globally think the economy will be better in a year.
Price Reduction Seeking: 40% are actively seeking out price reductions and promotions.
Trading Down: 35% are trading down to cheaper stores.
Preference for Local Products (Outside US): 56% plan to buy more local products in response to tariffs. This is higher in Canada (66%), Mexico (69%), Philippines (80%), India (77%), and South Africa (71%).
Boycott of US Products (Outside US): 37% have already indicated they will stop buying American products and services. This rises to 57% in Canada and 81% in China.
Brand Response Recommendations:
Keep advertising.
Be clear on pricing strategy.
Prioritize strong customer experiences.
Respond to changing emotional needs.
Innovation can be an opportunity.
Consumer Perception of Businesses: More than two in five people think prices are rising because businesses are overcharging.
Key Takeaway:
Global consumers are significantly concerned about how tariffs will impact them personally, adding to existing pressures from the economy and inflation, and are already making or planning to make changes to their spending habits as a result. Brands need to be mindful of these concerns and adapt their strategies accordingly, focusing on clear pricing, customer experience, and meeting evolving consumer needs.
Main Trend:
The Exacerbation of Cost-of-Living Pressures by Global Tariff Concerns Leading to Shifts in Consumer Behavior
Description of the Trend (please name it):
The Tariff Tightening
What is consumer motivation:
Preserving purchasing power amidst rising costs.
Minimizing the financial impact of tariffs on their household budgets.
Seeking affordable alternatives due to increased prices.
Supporting local economies in response to global trade tensions (outside the US).
What is driving trend:
Implementation and potential expansion of tariffs by various governments.
Existing high levels of concern about inflation and the overall economy.
Direct impact of tariffs on the prices of goods and services.
Increased awareness among consumers about global trade policies and their effects.
What is motivation beyond the trend:
Basic need to afford essential goods and services.
Desire to maintain a certain standard of living.
Description of consumers article is referring to:
Age: Likely spans across all adult age groups globally, as cost of living and economic concerns affect everyone.
Gender: Not specified in the article.
Income: Impacts consumers across different income levels, but particularly affects those with lower and middle incomes who have less disposable income.
Lifestyle: Consumers globally who are increasingly conscious of their spending due to economic pressures and now the added concern of tariffs.
Conclusions:
Tariffs are significantly contributing to the existing cost-of-living crisis globally, causing consumers to worry about their personal finances and prompting changes in their shopping habits, including a potential shift towards local products and boycotts of American goods in some regions.
Implications for brands:
Need to carefully manage pricing strategies in the face of tariffs.
Should focus on clear communication about pricing and value.
Brands outside the US may see an opportunity to promote local products.
US brands may face increased resistance in some international markets.
Implication for society:
Could lead to shifts in global trade patterns and potential economic friction between countries. May also impact consumer access to and affordability of certain goods.
Implications for consumers:
Likely to face higher prices on some goods due to tariffs.
May need to adjust their shopping habits to stay within their budgets.
Could see increased emphasis on locally sourced products in some regions.
Implication for future:
The interplay between global trade policies and consumer behavior will likely continue to be a significant factor in the economy. Brands will need to remain agile and responsive to these evolving dynamics.
Consumer Trend (name, detailed description):
The Tariff-Wary Shopper: This trend describes consumers globally who are increasingly aware of and concerned about the potential impact of tariffs on the prices of goods and are adjusting their shopping behavior to mitigate these effects, such as seeking value, considering local alternatives, and in some cases, boycotting products from specific regions.
Consumer Sub Trend (name, detailed description):
The Localism Leaning Consumer (Non-US): A sub-trend indicating a growing preference among consumers outside the United States to purchase locally produced goods and services as a direct response to tariffs and to support their domestic economies.
Big Social Trend (name, detailed description):
Increased Awareness of Global Economic Interdependence: Consumers are becoming more aware of how international trade policies, such as tariffs, can directly affect their daily lives and household budgets.
Worldwide Social Trend (name, detailed description):
Heightened Concern Over Cost of Living: Globally, there is a widespread and growing anxiety among consumers regarding the increasing cost of essential goods and services, with various factors like inflation and now tariffs contributing to this pressure.
Social Drive (name, detailed description):
The Pursuit of Economic Stability and Affordability: Consumers are fundamentally driven by the need to secure their financial well-being and maintain access to affordable necessities.
Learnings for brands to use in 2025: (bullets, detailed description)
Acknowledge and understand the significant consumer concern surrounding tariffs and rising costs.
Be transparent and strategic about pricing in the face of potential tariff-related increases.
Highlight the value proposition of your products, especially in comparison to potentially more expensive alternatives.
For brands outside the US, consider emphasizing local sourcing and production as a point of differentiation.
Maintain strong customer relationships and respond to their evolving emotional and financial needs during this uncertain time.
Strategy Recommendations for brands to follow in 2025: (bullets, detail description)
Develop clear and consistent messaging around pricing and value.
Explore opportunities to absorb tariff costs where possible to maintain competitive pricing.
Emphasize the quality and benefits of your products to justify their price.
For non-US brands, actively promote local sourcing and support for the domestic economy.
Invest in understanding consumer sentiment and adapting your offerings and communication accordingly.
Final sentence (key concept) describing main trend from article (which is a summary of all trends specified):
In 2025, "The Tariff Tightening" trend underscores how global concerns over tariffs are exacerbating existing cost-of-living pressures, leading to significant shifts in consumer behavior as shoppers seek affordability and, in many regions outside the US, consider local alternatives and boycotts of American products.
What brands & companies should do in 2025 to benefit from trend and how to do it:
In 2025, brands and companies should proactively acknowledge the significant impact of tariffs on consumer cost-of-living concerns and adapt their strategies by focusing on clear and value-driven messaging, exploring pricing strategies that minimize consumer burden, and for non-US brands, potentially highlighting local sourcing. By understanding and responding to the "Tariff Tightening," businesses can build trust with consumers and navigate this challenging economic landscape effectively.
Final Note:
Core Trend: The Exacerbation of Cost-of-Living Pressures by Global Tariff Concerns Leading to Shifts in Consumer Behavior: Tariffs are adding to existing financial worries and changing how people shop globally.
Core Strategy: Be transparent about pricing and value, consider local sourcing (for non-US brands), and understand consumer sentiment.
Core Industry Trend: Increased volatility in global trade and consumer markets due to tariffs and economic uncertainty.
Core Consumer Motivation: Protecting personal finances and seeking affordability amidst rising costs influenced by tariffs.
Final Conclusion: The study highlights the significant role of tariffs in compounding global cost-of-living pressures, necessitating a careful and consumer-centric approach from brands to navigate this evolving economic reality.
Core Trend Detailed (The Exacerbation of Cost-of-Living Pressures by Global Tariff Concerns Leading to Shifts in Consumer Behavior):
Description: This core trend describes how the imposition and potential increase of tariffs on international trade are compounding the already significant financial burdens faced by consumers globally due to pre-existing concerns about inflation and the overall state of the economy. The anticipation and implementation of these tariffs are adding another layer of complexity and cost to the supply chain, ultimately translating into higher prices for a wide range of goods and services. This additional financial strain is forcing consumers to further scrutinize their spending, consider significant changes to their lifestyles and shopping habits, and in some regions, contemplate boycotts of products from countries imposing tariffs.
Key Characteristics of the Trend (summary):
Increased Consumer Financial Anxiety: Tariffs are adding to existing worries about the cost of living.
Direct Impact on Prices: Tariffs are expected to lead to higher prices for imported goods.
Lifestyle and Shopping Changes: Consumers are actively seeking ways to cut expenditure.
Preference for Local Products (Outside US): Many consumers outside the US plan to buy more local goods as a response to tariffs.
Consideration of Boycotts: Some consumers are indicating a willingness to stop buying products from countries imposing tariffs.
Market and Cultural Signals Supporting the Trend (summary):
The Kantar study finding that 76% of people globally are concerned about how tariffs will affect them personally, on top of the 88% worried about the economy and 85% concerned about inflation.
The statistic that 86% of people are considering lifestyle or shopping changes due to rising prices, which are being further fueled by tariff concerns.
The finding that a significant percentage of consumers outside the US (56%) plan to buy more local products and services in direct response to tariffs.
The indication that 37% of people outside the US have already said they will stop buying American products and services, with even higher percentages in countries like Canada and China.
How the Trend Is Changing Consumer Behavior (summary):
Increased Price Sensitivity: Consumers are actively looking for discounts and promotions.
Trading Down to Cheaper Alternatives: Shoppers are switching to lower-priced stores or brands.
Supporting Local Businesses: There's a growing inclination to purchase locally made products.
Potential for Political Consumerism: Consumers may choose to boycott products from specific countries based on tariff policies.
Implications Across the Ecosystem (For Brands and CPGs, For Retailers, For Consumers, summary):
For Brands and CPGs: Need to navigate complex pricing strategies in the face of tariffs. Brands outside of major tariff-imposing regions might highlight local sourcing.
For Retailers: May see shifts in consumer demand towards more affordable or locally sourced products. Need to adapt their sourcing and pricing strategies accordingly.
For Consumers: Likely to face higher prices on some imported goods. Will need to be more strategic in their shopping to manage their budgets.
Strategic Forecast: This trend is likely to persist and potentially intensify as global trade tensions continue and tariffs remain a significant policy tool. Consumer behavior will likely further adapt to these economic pressures, with a greater emphasis on value, local sourcing, and potentially more politically motivated purchasing decisions.
Final Thought: The addition of tariff concerns to the existing cost-of-living crisis is creating a challenging environment for both consumers and businesses globally. Understanding and responding to these evolving consumer behaviors will be critical for navigating the complexities of the current economic landscape.
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