A sweeping 10% tariff now applies to nearly all imports to the US, with a staggering 125% duty on goods from China (as of this post). While many prices haven’t surged yet, they will soon.
When they do, advertisers will be one of the first to feel the pressure.
Ad budgets will likely get cut, retailers will scramble, clients may panic and as always, marketing will be expected to do more with less.
Thankfully, history and our friends are a wealth of proactive advice!
We’ve dug into previous trade wars and gathered insights from top advertisers, agency leaders, and marketing economists.
In this guide, we’ll break down:
- What history tells us about the impact of tariffs on marketing
- What’s different (and more dangerous) in 2025
- How to protect your budget, prove your value, and keep your strategy sharp — even in a downturn
What does history tell us about tariffs and ad budgets?
This isn’t the first time tariffs have shaken the economy. Here’s what we saw in the past:
“Steel tariffs” (2002–2003)
- U.S. steel prices rose by ~30%
- Auto and appliance industries slashed marketing and hiring
- Ad spend dropped in durable goods and B2B categories
U.S.-China trade war (2018–2020)
- 25% tariffs on $250B in Chinese imports
- Ad spending in retail dropped 5%, and auto ads fell 7%
- Consumer prices rose 1.7% to 7%
- Marketers shifted toward performance channels, cutting broad branding efforts
The common thread here is that when margins get squeezed, advertising is one of the first things on the chopping block. Brands either pull back or shift to lower-cost, more trackable channels.
What makes 2025 different?
According to NRF and Deloitte, 2025’s economic outlook is more fragile than that of prior years:
- Retail growth projections dropped to 2.7–3.7%, down from a previously forecasted 4.5%.
- Ad growth projections were already revised down by Madison & Wall and MAGNA before the full extent of the tariffs was known.
- The IAB reports that 94% of advertisers are worried about cuts, and 60% expect ad budget reductions of 6% to 10%.
Layer on continued inflation, geopolitical tensions, and inventory challenges, and we’re looking at a perfect storm.
What problems could you face, and how could you overcome them?
Here’s what you could be dealing with in the coming months and what today’s top experts suggest doing about it.
Problem 1: Budgets could disappear overnight.
“We had Q2 spend planned and ready — the next day, it was on hold indefinitely.”
— Casey Gill, WebSavvy
“We’re seeing panic responses. Some clients are scaling back before they even run the numbers.”
— Dii Pooler, Pooler Digital
Why this matters:
When headlines trigger panic, budget cuts often happen suddenly — and without warning. If you’re not pacing spend in real time or watching for campaign spikes, you could miss your window to adjust before the budget’s already gone.
What to do:
- Offer weekly pacing + ROI check-ins to give clients a sense of control
- Prepare “what-if” scenarios so you’re not caught scrambling
- Show how even small budgets can still drive performance with the right optimizations
How Optmyzr helps:
Optmyzr’s Budget Pacing feature shows how spend is tracking relative to the ideal pace for the month, adjusting for seasonality, days elapsed, and linear benchmarks. It flags whether you’re underspending or overspending at any point, so you can rebalance before it’s too late.
On top of that, the Anomaly Detector script alerts you when key metrics (like cost, conversions, or impressions) suddenly deviate from expected levels, even down to the hour. That way, if a campaign starts to underperform or overspend before leadership cuts the budget, you already know, and you’re already acting.
“The Budget Pacing tool is a team favorite. It allows us to show visually where the money is going and helps us figure out where best to invest the budget for clients.”
— Mike Rhodes, WebSavvy
Problem 2: You’re optimizing for margins that no longer exist.
“Clients are still optimizing based on pre-tariff product costs. That’s a trap.”
— Duane Brown, CEO, Take Some Risk
“Some brands are upside down on containers they already sold. They’ll lose money on every order once tariffs hit.”
— Sam Tomlinson, EVP, Warschwaski
Why this matters:
If your campaigns are still built around old pricing models, you’re likely overbidding, overexposing, and over-promising. With tariffs pushing up COGS, even previously “profitable” SKUs may now be selling at a loss.
You need to realign your bids and targeting around current product profitability, not pre-tariff assumptions.
What to do:
- Help clients recalculate post-tariff margins and rebuild campaign targets accordingly
- Segment and prioritize products based on actual margin, availability, and pricing competitiveness
- Replace aggressive discounts with value-based messaging (e.g. bundles, eco causes, loyalty perks)
How Optmyzr helps:
Optmyzr makes it easier to respond to shifting margins with tools that give you granular visibility and control over your product-level campaigns.
With the Shopping Feed Audit, you can catch issues like overlapping products, disapproved listings, missing data, or overpriced SKUs — all before they waste spend.
The Product Group widget helps you split large product groups into tighter segments, so you’re not bidding the same on high-margin and low-margin SKUs.
The Custom Label widget lets you tag products dynamically based on margin, stock level, or pricing competitiveness so your campaigns always stay aligned with your business goals.
“Optmyzr’s monitoring, alerting system, and shopping feed audit were incredibly helpful in keeping campaigns and product feeds optimized. The reporting features generate qualitative reports with one click, which is invaluable during high-demand periods.”
— Matthieu Tran-Van, Consultant
Problem 3: Global messaging needs to shift fast.
“We’re softening our U.S. brand voice when advertising in Canada.”
— Julia Vyse, Digital Director, dentsu digital
“Messaging that leans on ‘Made in America’ is landing differently across regions — sometimes not at all.”
— Marilois Snowman, CEO, Mediastruction
Why this matters:
Tariffs aren’t just an economic issue — they’re an emotional one. In times of global tension, how you talk can matter just as much as what you sell.
Messaging that worked three months ago might now feel tone-deaf or even offensive, depending on the market. Geo-sensitive campaigns are no longer optional; they’re essential.
What to do:
- Run structured A/B tests across markets to learn what tone, phrasing, or offer resonates best
- Experiment with angles like:
“Inventory landed before tariff hikes.”
“Local quality, global delivery”
- Reassess ad copy weekly based on geo-specific performance
How Optmyzr helps:
Optmyzr gives you everything you need to adapt messaging and targeting by geography without guesswork.
- The Geo Heatmap helps you spot which locations are driving ROI, and which ones are costing you without converting. You can visualize this data using a heatmap segmented by city, region, or country.
- Geo Bid Adjustments lets you automatically raise or lower bids based on a location’s past performance, even if that region wasn’t previously targeted.
- And if you’re managing multiple ad accounts, the Ad Analyzer helps you scan campaigns to find winning creatives and flag poor performers across locations, including Meta Ads placements.
Problem 4: Ad spend is being reallocated across channels.
“Search is still seen as gold in volatile times.”
— Ewan McIntyre, Gartner VP & Analyst
“Microsoft Ads is a smart play right now. Low competition, solid returns.”
— Casey Gill, WebSavvy
Why this matters:
When uncertainty hits, advertisers stop experimenting and go back to what works. Search, Shopping, and email/SMS retention tend to hold strong, while CPM-heavy or top-funnel channels often take the first hit.
The challenge is that many advertisers still have their budgets locked into legacy structures — channels that are now too expensive, or product groups that are no longer profitable.
What to do:
- Rebalance toward ROI-driven channels like search + shopping
- Test platforms with lower CPMs (Microsoft, Pinterest, Reddit)
- Double down on email + SMS for retention
How Optmyzr helps:
Optmyzr’s Shopping Campaign Management tool gives you the flexibility and control needed to confidently shift spend where it performs best, especially during volatility.
- Launch Google Shopping, Performance Max Retail, or Optmyzr Smart Campaigns (with Target ROAS baked in) all in just a few clicks
- Use feed-based rules to filter which products go into each campaign based on performance or custom attributes like margin or price sensitivity
- Restructure existing Shopping or PMax campaigns, even those created outside of Optmyzr, by splitting product groups or redefining ad group hierarchies
- Reallocate budget dynamically across campaigns and ad groups using advanced bidding and targeting settings
- Sync campaigns with real-time feed changes from your Merchant Center — keeping your product ads up-to-date, without constant manual intervention
Problem 5: Inventory gaps will tank your ROI.
“You can’t run ads on products that are out of stock. That kills trust.”
— Andrew Dimitriou, Global Marketing Strategist
“We’ve got brands promoting SKUs they literally don’t have anymore. That’s wasted spend.”
— Sam Tomlinson
“Inventory unpredictability is back, just like COVID. If your messaging doesn’t match your shelf, you’re in trouble.”
— Julie Friedman Bacchini, Founder, Neptune Moon
Why this matters:
Tariffs are already disrupting global supply chains, and as delays and stockouts increase, you risk spending real dollars promoting products that simply aren’t available.
This kind of misalignment doesn’t just waste budget. It confuses customers and erodes trust.
What to do:
- Sync campaigns with real-time inventory feeds or Merchant Center updates
- Prioritize products with healthy stock levels and solid margins
- Monitor campaign performance weekly to catch unexpected drops tied to inventory or feed issues
How Optmyzr helps:
Optmyzr helps you stay ahead of inventory-related issues by surfacing exactly what’s causing your campaign performance to slip, so you can take quick, focused action.
- The PPC Investigator analyzes your account’s data and pinpoints the root cause of performance changes, like a drop in conversions or ROAS. Whether it’s a paused product group, an out-of-stock SKU, or a feed issue, you’ll know exactly what’s driving the problem and where to fix it.
- With the Cause Chart and Root Cause Analysis, you can drill down by campaign, keyword, product type, or placement to get full visibility on performance volatility, especially helpful when your feed or inventory status is in flux.
- Pair this with the Shopping Feed Audit, which flags missing data, disapprovals, and products that have vanished from your campaigns before they create real revenue leaks.
What will smart marketers do differently?
The smartest advertisers right now are:
- Running margin-aware campaigns
- Shifting spend toward search, shopping, and retention
- Offering preemptive messaging around pricing
- Helping clients renegotiate SaaS and agency contracts
- Automating what can be automated to buy back time
As Jasmine Enberg from eMarketer put it:
“This is a new era of uncertainty, and marketers are already playing defense.”
You don’t need to panic. But you do need to plan.
Tariffs may be outside your control. But how you respond is where leadership lives.
If you only do 3 things after this:
- Re-calculate your margins and rebuild bids around profitability
- Pivot your messaging to match shifting inventory and customer sentiment
- Double down on automation to stretch your time and team further
And if you believe Optmyzr is the tool for you, sign up for a 14-day free trial today.
Thousands of advertisers — from small agencies to big brands — worldwide use Optmyzr to manage over $5 billion in ad spend every year. Plus, if you want to know how Optmyzr’s various features can help you in detail, talk to one of our experts today for a consultation call.
