March 17, 2025 – The president of the United States has announced planned tariffs placed on thousands of imports from Canada, Mexico, and China. The placement of tariffs on goods coming into the United States from Canada, Mexico, and China will affect more than just the economy.
This article is based on Innova’s Turning Trump’s Tariffs into Opportunities report. This report is available to purchase or with an Innova Reports subscription. Reach out to find out more
Tariffs Create a Turning Point
The effects of tariffs go well beyond economics. Tariffs will create a turning point in terms of American culture and the behavior of American consumers. Today’s times are highly uncertain, so consumers have to be able to adapt and adjust. Certainly, they will need to adjust their budgets. Tariffs also will force them to redefine their lifestyle and set priorities about how they shop and engage in the marketplace. Everyone will be affected – consumers, brands and retailers all need to steel themselves for the impact of tariffs.
CPG Products are Affected by Tariffs
Trump’s tariffs are likely to affect pricing strategies in all industries. The effects of tariffs on CPG products in the US like food, drinks, beauty and personal care items will affect consumers quickly and will have an immediate major impact on the way they shop. US tariffs on imported alcoholic beverages, produce, and other products will cause prices to US consumers to go up. The counter-tariffs placed on US exported goods in retaliation will affect the US supply chain and its ingredients.
Higher Prices and the US Consumer
US consumers feel the impact of inflation. According to Innova’s Foodservice & Grocery Survey 2025 (US), three in five US shoppers said they are spending more on food and drink because of inflation while more than half of US shoppers say that although prices may be steady, product sizes are shrinking. And many of those who are spending less on food and drinks blame rising costs. US consumers even are cutting back on restaurant meals.
It will be hard for brands and retailers to raise prices to cover their additional costs because they risk losing customers. US consumers are financially stressed and are likely to look for ways to save money by trading down or completely out. That is why brands must be proactive in building and sustaining the trust and loyalty of US consumers. Consumer trends research conducted by Innova Market Insights found that over one-third of US consumers were less trustful of brands in 2024. When asked, US consumers say that brands prioritize profits over the consumer.
Retailers Can Work Toward Positive Outcomes
It’s easy to see the negatives in Trump’s tariffs. Consumers will pay higher prices. Manufacturer margins will shrink. Retailers will be fighting to retain US consumers and levels of consumer spending. However, brands in the US have the opportunity to help consumers with solutions that help their dollar go further. Brands can be successful by regaining trust from the US consumer, fostering consumer resilience, and offering solutions that meet consumers where they are. One solution may be local sourcing.
Strategies for Helping the American Consumer
Brands can help US consumers to stay within their budget. With the support of brands, US consumers can save money by supporting the environment through reducing food waste, recycling packaging, upcycling, and repurposing.
Another way is to support enjoyment and small impulse purchases. US consumers say that they prefer to reward themselves with small everyday treats rather than bigger experiences and events. Brands and retailers can help consumers downsize and enjoy small treats with smaller portions and more accessible ready-to-eat options.
Technology Aids Consumers
US consumers participating in consumer research say that technology helps them feel more in control. They prefer store apps to third-party apps, creating an opportunity for retailers. According to findings from the Innova Foodservice & Grocery Survey 2025, reaching consumers through personalization enhances their experience and can increase sales by appealing to consumer preferences, perception of value, and desire for trial. On-line, as well as in-store, rewards and incentives can boost omnichannel value.
Technology is particularly relevant for younger consumers. They are likely to use grocery apps and online platforms to compare prices, find discounts, and make healthful decisions.
Trends Predictions Anticipate the Effects of Tariffs
Innova trends forecasting can shed light on the impact of Trump’s tariffs. Megatrends in the global environment include political, economic, sociological, environmental and technological forces. Consumer macro trends describe lifestyles, attitudes and consumption behavior. Innova Market Insights consumer trends for 2025 predict opportunities for innovation.
The trend toward quality and integrity helps reinforce trust among consumers. Brands can demonstrate quality and integrity by having open conversations with consumers, investing in quality, and offering benefits consumers can rely on. According to Innova’s Lifestyle & Attitudes Survey 2024, US consumers are concerned about being able to purchase foods that are affordable, healthy and nutritious. They are likely to turn to brands that they trust, align with their values, are honest, and have integrity.
The trend pertaining to being savvy and self-sufficient stresses the importance of helping consumers gain control of their health and meals.
What’s Next for US Brands in a Time of Tariffs?
Brands can become more transparent by communicating about necessary changes in products and prices. Brands and retailers are facing similar challenges to those faced by the US consumer, especially as Trump’s tariffs impact supply chains and production costs, leading to potential price increases.
Emphasize local and fresh. Even though consumers may turn to online grocery shopping for convenience, nothing replaces in-store shopping when it comes to buying based on quality and price. US stores can help consumers with products that are fresh and local, ready-to-eat, and portioned into appropriate sizes.
Focus on value and de-emphasize price. Promotions like rewards, discounts, and exclusive offers can attract US consumers and build loyalty. Personalized discounts should be accessible in-store and while shopping through apps. US consumers will feel more in control if they can take advantage of loyalty programs, price comparison tools, and meal planning solutions using retailer apps.
This article is based on Innova’s Turning Trump’s Tariffs into Opportunities report. This report is available to purchase or with an Innova Reports subscription. Reach out to find out more
