Chinese retailers may cut ad spending under new tariffs: US tariff crackdown could impact Temu and Shein's ad investments, reshaping the digital ad market.
The estimate indicates a major shift from advertisers in light of the platform鈥檚 potential US ban. The sharp decline comes despite TikTok usage returning to normal levels following a short blackout and temporary removal from US app stores鈥攁nd despite an outright ban seeming less likely in light of Oracle inching toward a final deal for a TikTok sale.
41% of US advertisers expecting budget cuts due to tariffs plan to cut from social media, while 24% plan cuts to linear TV and gaming, per February 2025 from the Interactive Advertising Bureau (IAB).
At the same time, holding company billings accounted for a smaller share of USad spending in Q1 2024 than in 2023, while brand-direct and other spending grew its share, per Advertiser Perceptions.
The company鈥檚 investments, which include building out its own logistics network to improve delivery times, has helped it deliver strong growth as the US-led trade wars disrupt much of the global economy. Mercado Libre, which doesn鈥檛 export to the US, has largely sidestepped that volatility鈥攑ositioning it to capitalize on regional growth even as rivals face headwinds.