DKC's latest research delves into the shifting landscape of tariffs and their impact on U.S. businesses and consumers. Below are some key findings from the study, offering valuable insights for businesses navigating this critical financial turning point. For a deeper dive, click here to download the full report.

For the entire 21st century, inflation in the US economy was at 4% or less. Then COVID hit and a decades-long period of financial stability dramatically ended. Consumers and businesses alike were shocked by inflation spikes to rates not seen in a generation.

Anticipating a new era of American governmental policy—both foreign and domestic—means we must prepare to tackle another potentially inflationary shift: a return to tariffs. To this end we fielded first-of-its kind research, testing messaging with a representative sample of 1,000 American consumers in order to better guide business leaders on how to navigate this critical financial turning point in the U.S. economy. 

The Three Messages That Work: Consumer Preferences on Tariff Messaging

We tested 10 potential response messages for a scenario of tariff-driven price increases, and measured brand confidence shifts. We analyzed the impact on different consumer groups, including elites, budget consumers, and middle America, and various demographic cohorts. 

Three statements work across the board…

1. We’re going to be completely transparent about the impact of tariffs on our business because all Americans should be able to see how they affect our prices.
2. We have to make a hard choice between raising prices and maintaining our employees’ salaries and benefits, and right now we’re doing all we can to protect our employees’ and their families.
3. Price increases are hopefully temporary while we explore new domestic suppliers and other cost reductions.

Whatever you say, don’t say this: “We have to raise our prices because other countries have retaliated against US businesses.”

Key Findings

Know your consumer. If they lean more Democrat, they're more likely to blame businesses for inflation. If they lean Republican, they’re more likely to blame businesses only if tariff policies fail.

Know your industry. Some industries require more explanation because consumers won’t anticipate tariffs causing rising prices. But in all cases, some simple definitions will be required upfront.

Leverage experts and/or stress the relevant expertise of the leader. 

Stress transparency in communicating about the challenge and establish that a top priority of the business leader is protecting the company’s employees from harm.

Detail concrete specific action steps to combat price hikes: cutting executive pay and exploring shifts in manufacturing and supply. 

Don’t blame China or Russia, rather emphasize if tariffs issues are coming from places like Europe, where most consumers don’t want tariffs.