Here we go again with tariffs.
Once again, businesses are trying to understand what higher costs might mean for pricing, demand and consumer behaviour.
And once again, many CPG brands are asking the same question:
If prices go up because of tariffs… what will consumers actually do?
Our latest research suggests the answer may surprise some people.
Nearly half of Americans (46%) say they don’t plan to change what they buy at all because of the current trade tensions. Just 27% say they’ll actively look for products made in the USA, while only 7% plan to avoid Canadian products altogether.
Those are very different numbers from what we’re seeing in Canada.
And I think they tell us something important.
For many Americans, this doesn’t appear to be primarily a “Buy American” story.
It’s still a value story.
When we asked what would have the greatest influence on switching to an American-made alternative, price came first at 70%, followed by product quality at 62%. Only 23% selected Made in the USA as one of the most important factors.
The same pattern shows up when we asked about willingness to pay.
Only 16% said they would pay any premium for a comparable American-made product. More than half said the American product would have to cost the same or less, and only 5% said they would pay more than a 10% premium.
For me, that’s where the story gets interesting.
The tariffs may be changing the conversation
They don’t appear to be changing the fundamentals of how Americans make purchase decisions.
Consumers are still comparing value.
They’re still looking at quality.
They’re still asking whether paying more is actually worth it.
So what does that mean for CPG brands?
It raises more questions than answers.
How much pricing flexibility does your brand really have?
How much of a tariff-related increase can your customers absorb before they start looking elsewhere?
How much of your loyalty is genuine, and how much depends on maintaining a competitive price?
What role does brand trust play when consumers are forced to make trade-offs?
And are those answers the same across every category and every consumer?
Because the switching story isn’t entirely straightforward.
When Americans were asked what they would do if tariffs increased the price of a Canadian-made product they regularly buy, only about one-quarter said they would actively look for an American-made alternative. Nearly one in five said they would simply buy whichever comparable product offered the best value, and a similar proportion said they would stay with the brand they already preferred or trusted.
That tells me tariffs alone aren’t enough to predict what consumers will do.
Brand equity still matters.
Price still matters.
Quality still matters.
And perhaps more than anything else, habit still matters.
That’s why I’d be careful about assuming any one headline number tells you what will happen to your brand.
The tariff environment will continue to evolve.
Consumer behaviour will evolve with it.
The brands that will be in the strongest position won’t necessarily be those with the lowest prices.
They’ll be the ones that understand where their pricing flexibility ends, where loyalty begins to break down, and which consumers are most likely to stay with them when the market changes.
The more useful questions for CPG brands are becoming very specific
What is happening in my category? With my consumers? At my price point? Against my competitors? And is it changing?
Because tariffs may start the conversation.
Understanding how consumers respond is what ultimately determines who wins.
Navigate the CPG landscape with confidence. Connect with our team to uncover the insights, strategies, and solutions you need to stay ahead of shifting consumer priorities and navigate the complexities of today’s trade war.
