ESW has officially published the results from a report, which reveals that six in ten U.S. consumers will not absorb more than a 10% increase in pricing due to tariffs.
Named as Impact of Tariffs on Purchasing Decisions, the survey further goes on to reveal how, apart from discounts or promo codes, consumers want free shipping, loyalty rewards, and transparent communication regarding price increases in exchange for higher tariff-induced costs.
Talk about the entire exercise on a slightly deeper level, we begin from a detail which claims that most consumers will reduce spending once tariffs take effect. From a statistical standpoint, 70% of all consumers say that they will reduce overall spending once tariffs go into effect. Out of that, millennials top the list in regards to planning spending cutbacks, with 78% indicating a reduction. However, at 54%, Boomers emerged as the most likely generation to stop buying certain imported goods altogether.
Next up, ESW’s study reveals that Gen Z is spending now to save later. 58% of Gen Z shoppers have basically pulled forward their purchases of high priced items such as iPhones, computers, and champagne in advance of potential tariff increases. Overall, 45% of consumers were found to have pulled forward spending on electronics, whereas on the other hand, 37% are stocking up on groceries.
Another detail worth a mention is rooted in a particular finding, which claims that discretionary items will be hit the hardest. We say so because 68% of consumers are going cut back on electronics because of tariff increases, 61% are reducing purchases of apparel and accessories, as well as 51% will spend less on home goods.
Having said so, 33% of consumers will continue to pay for pet supplies regardless of tariff increases, second only to groceries.
Beyond that, the stated survey discovered that millennial consumers are 36% more likely than other generations to prefer that brands offer buy now, pay later options, even if it means paying higher prices.
ESW’s survey also digs into how consumers across the board perceive online shopping as less expensive than shopping in-store: From the ones spending more online this year, nearly 40% would go on to say that they feel shopping online is less expensive than shopping in-store.
Moving on, the survey in question further reveals how luxury brands benefit from global shoppers: This global availability comes packaged along with technological advancements, economic dynamics, broader product selections, and changing consumer behaviors. All in all, 25% percent of consumers who purchase luxury goods did so from outside their home countries, with 21.2% of consumers saying that they purchase from brands like Burberry, Bulgari, or Dior, both domestically and internationally.
Almost like an extension of it, ESW’s survey also claims that consumers are actually finding same products less expensive when purchasing from outside their country. Basically, an estimated 46% of online shoppers, purchasing items outside their home country, were deemed to be motivated by significantly lower total cost, including taxes and shipping, than what they have to pay domestically.
Hold on, we still have a couple of bits left to unpack, considering we haven’t touched upon the fact that reveals shoppers will not spend more for sustainable products. Even with two-thirds of consumers making efforts more sustainable in their day-to-day lives, nearly 53% (52.9%) said they will not spend more for eco-friendly products.
Having said so, half (51%) of all consumers do say that they consider the environmental impact of items when they are shopping, such as carbon emissions, dye water contamination, and microplastics. On top of it, 54% of shoppers also consider ethical production when shopping, including safe working conditions and fairly paid workers.
Rounding up highlights would be a piece of detail which expects one in every three shoppers (32%) intends to spend less online in 2025. From the ones who are planning to cut back, 58% cited saving money as the primary driver. Apart from that, concern about the current economic climate was cited as the second highest reason for cutting back at 36%, while high cost of essentials, such as food, ranking third (32%).
