Happy Sunday, Everyone!
Q1 is officially in the books, and Q2 is off to one of the most volatile starts in recent memory.
Welcome to the Whiplash Economy
On April 2, 2025, President Trump announced a sweeping series of "reciprocal tariffs" targeting every country - including key U.S. trade partners like China, Mexico, Vietnam, Japan and South Korea. As one of the many people watching both the announcement (on X, where else) and the markets, the impact was near-instant: every major index started to tank, credit markets reeled & even traditionally-safe havens offered no reprieve. As I’m writing this on Friday evening, we’ve just closed the single-largest two-day decline (in absolute terms, not percentage terms) in the history of the Dow Jones (yes, really - it’s worse in absolute terms than 2008).
Since the announcement, I’ve spoken with over a dozen brands and clients, with every one asking the same questions:
- How in the world do we navigate this?
- What should we be doing from a marketing/growth perspective to weather the storm?
- Where are the opportunities for us to capitalize?
Those are the right questions to ask. But let me add one more: Why are we still surprised?
Over the past decade, volatility has become the defining feature of the global economy. In just the last few years, we’ve endured COVID-era shutdowns, container shortages, 2022’s energy shock, inflation spikes, bank runs, and AI upheaval.
This is the whiplash economy: the inevitable end-game of a hyper-connected world, where trends, searches, fashion and conversations change at the speed of TikTok. This week’s tariff-induced sell-off isn’t a one-off; it’s a symptom of a new structural reality.
We’re living through the age of informational + economic weaponization. Supply chains are both brittle and politicized. Trade has become a battlefield. Volatility is the rule, not the exception. And honestly, things are more likely to get worse before they get better. Normalcy is, for better or worse, not on the menu.
And while it’s tempting to view chaos in the markets and geopolitical unrest as issues for everyone else (CEOs, COOs, CFOs), the reality is this: marketers don’t have the luxury of sitting this one out. Let’s go one step further: surviving (let alone thriving) in this environment requires a new kind of marketer.
Tariffs & trade wars are no longer a finance department issue. It’s a value chain issue. A margin issue. A pricing issue. A perception issue. Everything is inextricably linked.
Tariffs 101 (for People Who Don’t Have Time for Tariffs 101)
Before we get into what to do, let’s do a quick primer on what’s going on (you know, in case you haven’t been doomscrolling / doomviewing 24/7 for the last few days).
Tariffs are levies (read: taxes) on imports. Speaking broadly, tariffs tend to be regressive (they disproportionately burden lower-income households/consumers) and inflationary (they raise the prices of goods/services). The intention behind a tariff is to make foreign goods more expensive, thereby making domestic alternatives more cost-competitive, protecting domestic manufacturing and/or serving as leverage in international negotiations.
As you’d expect, when tariffs are imposed, the cost of goods imported from affected countries immediately increases. This spike can manifest in a number of ways: brands may absorb the cost, pass it on to consumers, or attempt to re-engineer their products to circumvent the impacted materials. Pricing models get upended. Supplier contracts become liabilities. Entire categories of goods become suddenly unprofitable.
That’s exactly what is happening now. I’ve spoken with several ecommerce operators who have pre-sold goods on the water (read: on ships crossing the Pacific ocean) that will be tariffed at a rate that exceeds the profit made on their sale. Several others will be forced to raise prices by upwards of 25% over the next week in order to maintain profitability (not their current margins - just keeping their heads above water).
We have not had a tariff regime like the one imposed by President Trump in nearly 100 years. The closest thing to it was Smoot-Hawley in the early 1930s, which was a major catalyst of the great depression. I’m not saying this is that. There are far more - and far more powerful - financial tools available to us now than we did in the early 1930s. That all being said, here’s how this typically plays out: sectors with tight margins or global sourcing footprints feel the pressure first. Apparel brands that rely on Asian textile mills, electronics companies that source semiconductors from Taiwan, foreign auto manufacturers (i.e. Germany & Italy) or CPG brands with packaging sourced from Indonesia, India, Vietnam and/or China are among the early casualties. Note: that’s where it starts. It isn’t where it ends.
The cascading impacts of tariffs will be felt throughout the economy: the cost of everything from rare earth minerals and oil to servers to buildings, airplanes, household goods, coffee, even black pepper will be impacted. To what end, no-one knows (and that’s part of the problem).
Unfortunately, tariffs are now the single-most-important economic factor for brands.
That means marketing teams must be at the table from the beginning, not after the damage is done. As your margin erodes (and it will erode), your allowable CAC will need to shrink to keep up. If your pricing changes, your messaging must shift. If product availability gets spotty, your customer service and brand trust take a hit. To illustrate how tariffs can wreak havoc on your P&L, consider this from a hypothetical brand:
Understanding tariffs isn’t about policy. It’s about profit. The marketers who understand the mechanics and can help their organizations navigate these uncharted waters will be the ones who come out the other side (this too shall pass) with a healthier, more robust and more resilient business/organization.
This Isn’t Just a DTC Problem
The most common refrain I’ve heard from some people in the marketing world, “This is terrible for eCommerce/retail, but we’re [insert other industry here]. We’ll be fine.” Wrong.
As the market-wide sell-off from the last two days illustrates, the ripple effects of tariffs hit the entire economy, both directly and indirectly. Industries that don’t import a single finished product will still feel the consequences through tariffs on raw materials, supplier disruptions, pricing volatility, or cascading demand shifts.
We work with a number of brands in the home services space. I was speaking to one of them earlier today, he said that some partner HVAC companies are repricing already-signed work orders for unit installations and repairs, due to significant changes in costs for everything from condensers and air handlers to coils, compressors, and even ductwork. Roofing and construction suppliers are getting squeezed on lumber, fasteners, shingles, and insulation. These cost increases are passed on to contractors, then homeowners, who may postpone or reduce projects in the face of rising costs.
B2B and SaaS providers are feeling it, too. As eCommerce margins get crushed, brands have no choice but to re-negotiate their tech stacks. Industrial + larger enterprises are slowing their purchase cycles. Companies of all shapes and sizes are pulling back on professional services engagements, consulting contracts, system upgrade and non-essential SaaS.
Logistics and freight are taking hits as well. Shipping providers, 3PLs, and customs brokers face tighter margins and increased compliance complexity. Import/export friction leads to slower velocity and higher costs.
The list goes on and on:
- Healthcare and MedTech, where surgical instruments, diagnostic equipment, pharmaceuticals and packaging are often sourced globally. Tariffs raise not only costs, but regulatory risk and patient-level disruption.
- Automotive and EV manufacturers, reliant on international supply chains for batteries, semiconductors, and specialized metals. A 10% swing in component costs can vaporize profitability for a full product line.
- Agriculture and Food Processing, where cross-border trade is intrinsic to both input materials (grains, spices, packaging) and finished goods. Tariffs distort seasonal pricing and complicate long-term contracts.
- Food & Beverage, which relies on a complex international supply chain and often includes many ingredients which can’t be produced at anything close to required scale in the US (everything from pineapple and coffee to black pepper).
It doesn’t matter what industry you’re in: a sweeping tariff regime will impact your business. And most organizations (and most marketers) are woefully underprepared for the whirlwind we’re about to reap. I’m not just referring to rising costs, but to demand collapse. There are ways to thrive, but you’ll need to be ready.
The Brands That Adapt + Evolve Tend To Thrive
While this might be the most consequential trade action in recent memory, it’s hardly the first. The 2018/2019 U.S.-China trade war (it’s technically been ongoing since then, but most of the action was in ‘18 + ‘19) offers some insight into how savvy brands can adapt.
YETI announced that they are reworking their supply chain to include more U.S. assembly, diversifying production while reinforcing their rugged, American-made brand identity.
Patagonia embraced transparency as strategy. When costs rose, the brand sent direct messages to customers explaining why prices were increasing. They didn’t lose trust—they deepened it. The message was simple: we’re not cutting corners, we’re protecting our values.
Tuft & Needle diversified manufacturing early, anticipating volatility. Casper leaned heavily on a narrow set of offshore vendors. When tariffs hit, Tuft & Needle maintained continuity while Casper struggled to meet demand and maintain profitability (Casper ended up going public at $12/share, only to be taken private at $6.90/share less than 2 years later; Tuft & Needle maintained profitability and was acquired by Serta Simmons for an estimated $600-$800M).
Levi’s, with its significant supply chain leverage, renegotiated supplier agreements and expanded near-shoring capacity in Mexico. This move provided both operational leverage and PR ammo while major competitors flailed. American Giant (a personal favorite of mine) leaned in + aggressively promoted their “completely made in America” story (+ used it to capture significant market share).
The lesson here is clear: adaptive brands didn’t just survive—they used volatility to widen the moat.
The Playbook: Go On The Offensive
The default response for most brands during times like these are to wait and see. To pull back with a “tactical retreat.” To let the dust settle. It’s paralysis by fear and uncertainty.
That is not my preferred approach. When everyone else is following that playbook, the value of following the crowd goes to zero. The advantage comes from doing something different.
Start with your value chain. This is the time for ruthless clarity - you need to know which products/services/SKUs are tied to single vendors. Which suppliers operate out of tariff-impacted regions. Which materials are substitutable and which would require reengineering. This is not just about procurement efficiency. It’s about strategic foresight. Your marketing team should be sitting alongside your sourcing and ops teams, not reacting three quarters later when product availability suddenly shifts. Marketing/Comms is ultimately responsible for selling these changes to your target audience, so you need to be at the table, asking these questions and preparing these stories.
Once you’re clear on your value chain, move to the cost stack. Tariffs are not just a surcharge—they are a signal to re-examine every cost driver in your business. Freight contracts, fulfillment centers, packaging design, professional services, warehousing terms, SaaS agreements, and return logistics all must go under the microscope.
Many brands view margin erosion as an inevitability during lean times; the smartest operators I know use moments like these to tear up legacy agreements, rebuild cost infrastructure, and unlock better operating leverage. If you have not already started conversations with your partners about payment terms, price increases and short-term cost reductions, do that. Simply shifting from a net-30 to net-60 payment schedule can free up 8-10% more cash (it’s an interest-free loan of 1/12th your expenditure!).
Dynamic pricing is no longer optional. Price sensitivity has increased while loyalty has eroded. You must rethink how price is introduced, justified, and experienced. Do you offer bundles that protect perceived value? Can you use loyalty programs or email exclusives to offer early access before a broad price change hits? Are there regions where you can raise prices gradually, and others where you hold them steady for competitive moat? The answer is probably a multi-tiered pricing strategy that feels like shared pain + personalization.
But pricing is only half the equation; the other half is narrative.
This is where marketers earn their seat at the table. The same price hike can alienate or align depending on how it’s framed. Some brands will use tariffs to reaffirm their values—positioning themselves as defenders of American jobs or independent production. Others will present themselves as fighting back against misguided policy and protecting their customers from inflationary politics. The key is consistency with your core brand DNA. Patagonia can’t suddenly go MAGA. Harley-Davidson can’t suddenly boycott nationalism. You know your base, so speak their language. Make the moment yours.
Here are the strategic actions every marketing leader should take to future-proof their growth engine:
Step #1: Refactor CAC Benchmarks
Tariffs will force COGS up. Basic math tells you that in order to maintain your current margins, CAC must come down, prices must rise or AOV must increase. There’s more to it than that, but that’s the fundamental equation. The most important thing you can do now is to refactor your CAC based on your best approximation of the current reality.
In every business, contribution margin is calculated as follows:
Contribution Margin = Revenue - Variable Costs
If you expand “revenue” and “variable costs” into their constituent components, the above equation becomes:
Contribution Margin = (Visits * Conversion Rate * AOV) - (Costs of Goods Sold + Costs of Delivery + Customer Acquisition Cost)
Tariffs represent an increase to COGS and/or COD - so to maintain your current contribution margin, you either need more visitors to your site, more efficient conversion of the visitors you have, an increase the value of what you’re selling and/or a reduction in CAC.
The reality is that this will be an “all of the above” situation – but the best place to start in the short-run is to adjust your CAC thresholds based on new gross margin realities. This will prevent “bad” ad spend in the short-run, while you get ready for the pivot. Remember: it’s better to not spend than it is to spend poorly. Once you get behind the proverbial 8-ball in a situation like this, it’s virtually impossible to get out in front again.
Step #2: Rebuild Value Narratives
Any price increase isn’t a tactical challenge; it’s a strategic opportunity to share your brand and communicate your values. Your target audience doesn’t just want to know that your prices went up - they want to know why. This is doubly true in times like these, where consumers are feeling the pain, and want reassurance that brands aren’t trying to exploit a situation to increase profits.
This creates a unique moment to double down on narrative + brand alignment, while still protecting your margins. The first rule of this is to be honest and truthful in your communications. The second rule is to limit your price increases to what is necessary to maintain your margins and protect your business. It’s tempting to go higher (especially if your competitors are), but it always comes back around.
Once you’ve established your new price, it’s time to lean into the differentiators and shared values you have with your audience: is your product made in the U.S.? Amplify that. Is your sourcing transparent and ethical? Make it known. The story isn’t just that costs increased—it’s that your values are intact and your priorities unchanged. Frame the price increase as a byproduct of defending quality, not profiteering.
This works best if your founder/CEO/president is the one delivering the message. Have them create a video, write a letter, send an email - preferably all of the above. The more authentic, heart-felt and emotive the content, the better the message will land.
Step #3: Pivot Offers for Downmarket & Upmarket Segments
Any time there’s a pressure on consumer discretionary spending (i.e. recession, inflation, etc), the outcome is the same: consumers polarize while the middle evaporates. If you’re a brand that targets the middle (i.e. not super cheap and not ultra-premium), that can mean a world of hurt.
From a practical perspective, that means a large segment of your customers/clients will seek out value, while others will lean into premium and durable goods. If your offering is in either of those areas already, you’re in good shape – just lean in.
If you’re like most brands, and are somewhere in the middle, the road ahead gets more difficult. The best thing you can do is to create modular product packages that provide the ability to pivot quickly. Nimbleness is your greatest ally in uncertainty.
One example of this would be to offer smaller-size SKUs with lower price points for value shoppers, while building elevated, experience-oriented bundles for premium buyers. Adapt messaging for each: utility and affordability on one end, legacy and identity on the other.
Step #4: Reposition Brand to Match the Moment
Tariffs are not just about economics—they tap into identity and ideology. Take a stand that’s true to your audience. If you lean into patriotism, amplify your domestic sourcing, job creation, and commitment to American values.
If your customers skew more liberal, position your brand as a transparent, consumer-first company resisting unnecessary price pressure. Don’t try to straddle both. Pick a lane, commit to it, and reflect it everywhere from product copy to campaign creative to executive comms.
Step #5: Pivot Your Creative Strategy
Creative is one of the few levers you can pull and see near-immediate results. Audit your creative assets to identify what's converting over the past few days. Aggressively turn off ads that aren’t performing, along with anything that’s no longer appropriate for the moment.
Start churning out new creatives with the messaging + positioning above. Leverage any champions you have (influencers, partners, executives, super-clients, etc.) to help you get the message out and articulate your value proposition. Most brands slow creative velocity under uncertainty; your goal should be to accelerate it.
Your creatives should lead with clear benefits, pricing transparency, product reliability, and social proof. Rebuild creative frameworks with modularity in mind so you can test offers, angles, tones, and CTAs across channels without going back to the drawing board.
The objective here is to increase conversion rates AND drive down CACs, which is what will create the financial resources necessary to do #6 and #7 below.
Step #6: Reallocate Media Mix Toward Resilience
In volatile markets, channel fragility increases—so the answer isn’t to panic and spread your budget thin, but to anchor into your core while expanding strategically. From a practical standpoint, that looks like this: continue to invest in your proven high-ROI platforms: Meta & Google. These are still the foundation for most businesses. If anything, economic turmoil means people will be spending more time on the internet (and social media), not less.
But don’t stop there. As your competition pulls back their marketing, take the opportunity to build a meaningful presence on second-order platforms like Reddit, Quora, YouTube, and Yelp. These are places where intent, community, and influence are real but underutilized. Most brands that are laying off marketing teams or reducing paid spend simply can’t afford to compete. That leaves a vacuum you can fill.
From a paid perspective, this approach allows you to balance the predictable with the opportunistic.
Simultaneously, your team should be investing in owned channels—particularly email and SMS. These aren’t just retention plays; they’re margin-protecting, churn-reducing tools that reduce dependence on paid media.
The more you grow your owned audience, the more resilient your growth engine becomes. Strengthen your core channels. Opportunistically invest in underpriced platforms. Leverage your owned assets to the fullest extent.
Step #7: Invest in Brand While Competitors Retreat
When times get tough, the immediate response from most CFOs + CMOs is to cut brand spend and focus on their highest ROI channels.
That’s a mistake, but one you can capitalize on by not making it.
Basic supply and demand tells you this: as advertisers pull out of the market (reducing demand), the price of those impressions will decrease. This is the time to go long on brand storytelling. Lead with emotion. Highlight your values. Share your value propositions. Reinforce your positioning from above.
The brands that double down on brand now will be the ones with pricing power later. Zig when others zag. Invest for the long-term.
Step #8: Map Exposure & Build Redundancy
Supply chain volatility is your problem, too. Don’t just rely on ops to handle shortages; proactively anticipate how potential shortages or disruptions will impact your go-to-market motion. Identify which service lines, products and SKUs are at risk and build backup bundles or narratives around in-stock alternatives.
Prepare promotional plays for inventory that can absorb volume if a hero product or flagship service is no longer viable. Diversify not just what you source, but what you promote. Be ready to flex messaging, offers, landing pages, and creative to meet the moment.
Step #9: Sync Marketing + Finance Weekly
If they don’t already, your margin models must live in marketing dashboards now. You cannot run efficient campaigns without real-time cost data. Weekly meetings with finance should cover margin deltas, inventory forecasts, channel performance, and budget reallocation options.
This is your golden opportunity to tear down silos between finance, operations and marketing. You’re all in the same foxhole, so you might as well be friends. The more tightly aligned you are, the faster you’ll be able to improvise, adapt & overcome.
Step #10: Scenario-Plan & Stress Test Quarterly
Don’t wait for the next disruption to dictate your next move. Once you’ve stabilized your brand under the current regime, actively begin thinking about what’s next. Build simulation models for 5%, 10%, 20% COGS increases. Figure out a plan if a hero product or top-selling SKU is suddenly hit with a larger tariff.
Treat these questions like fire drills. Build response templates, channel reallocation strategies, messaging variants, and media contingency plans. When the next disruption hits, you’ll be activating a plan, not scrambling for a path forward.
This isn’t about fear-based planning. It’s about designing for anti-fragility. In a volatile world, your systems shouldn’t just survive shocks. They should get stronger because of them
Control What You Can. Prepare for What You Can’t.
The world won’t stop being chaotic. The next crisis won’t politely knock before it arrives. That’s the reality of the environment where we all must operate. The game isn’t rigged or broken, it’s just different.
As frustrating as that is, Petyr Baelish (of Game of Thrones fame) said it best: “Chaos is a ladder.” The brands seize the opportunities created by moments like these will be the ones that we look back at in 3, 5, or 10 years and say, “They adapted better than anyone else and communicated more clearly and emotively than everyone else.”
Marketing isn’t just an optional function anymore; it’s your brand’s media network. It’s the connective tissue between what’s happening in the world and how your company responds. If you build with that lens, volatility becomes a variable you can work with, not fear.
It’s my sincere hope that some of the ideas and strategies in this can be at least a little helpful to you as you try and navigate what is sure to be a turbulent Q2.
I have absolutely no idea what’s going to happen next. This could be the end of the beginning, the beginning of the end, or a deranged interlude in an otherwise up-and-to-the-right production. What I do know is this: the future doesn’t belong to the most polished operators. It belongs to the most prepared.
Until next week,
Sam
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