蘑菇AV

The insight: Fashion M&A activity is drying up as uncertainty and structural challenges dampen investor interest. The number of deals in the apparel and accessories category fell nearly 40% YoY globally in Q2, according to PitchBook data reported by Modern Retail. Our take: The current macroeconomic environment is not conducive to most M&A activity, as uncertainty pushes companies to conserve resources and focus on their core businesses. But for retailers in a relative position of strength, now could be the time to make strategic acquisitions that either reinforce their existing advantages or enable them to diversify.

Trump鈥檚 鈥淟iberation Day鈥� tariffs landed harder than expected. Uncertainty remains, given the pause on reciprocal tariffs for countries willing to negotiate with the US鈥攁long with an escalating trade war with China. Which markets will take the greatest hits? And how might our US forecasts change?

The insight: Prime Day got off to a strong start, according to Adobe data, despite alternative reports of a dip in spending. Our take: The early Prime Day enthusiasm is an encouraging sign for Amazon, which is counting on the event to not only boost sales but also unlock additional ad revenues. It could also be a good sign for retailers running competing sales. While we ultimately expect the longer sales period to benefit the ecommerce giant, shoppers鈥� growing awareness of other events鈥攁nd propensity to comparison-shop鈥攃ould help retailers like Walmart and Target grow their share of an increasingly lucrative shopping period.

The situation: A cloud of uncertainty has hung over the US economy since the Trump administration鈥檚 April 9 pause of so-called reciprocal tariffs. That鈥檚 made it difficult for retailers and brands to plan for the short and medium term. The outlook is now poised to grow even murkier. President Donald Trump extended the pause period鈥攐riginally set to expire on Wednesday鈥攗ntil August 1. At the same time, he announced new 25% tariffs on imports from South Korea and Japan, also taking effect August 1, along with steep additional levies on other countries. Our take: With companies planning to pass on about 70% of the cost of levies to consumers via higher prices, it鈥檚 no surprise that we expect tariffs to take a meaningful bite out of retail sales this year鈥攚hether we remain in the moderate scenario or shift into a heavier one. In such a dynamic environment, retailers and brands should rely on scenario modeling that accounts for a range of possible futures. They can hope for the best but plan for the worst to ensure they鈥檙e ready to adapt to whatever twists lie ahead.

The news: Budget concerns are top of mind for consumers as they plan their summers. Our take: Consumers鈥� inclination to save is likely to fuel anxiety in the hospitality industry鈥攅specially as uncertainty causes travelers to delay booking until practically the last minute.

Canada鈥檚 trade war with its largest trading partner is underway. While uncertainty remains around the scope and depth of US tariffs, Canadian brands and retailers need to rebalance a heavy reliance on US-based customers and suppliers.

The situation: Several recent macroeconomic indicators point to a tough and increasingly uncertain economic environment. Our take: Uncertainty has cast a long shadow over the retail industry all year鈥攁nd clearer skies aren鈥檛 on the horizon. Retailers trying to weather the economic storm must focus on delivering compelling value to cost-conscious consumers. That means leaning into what makes their brand stand out, whether it鈥檚 quality, service, loyalty perks, or meaningful innovation. With nearly a quarter of shoppers adjusting their budgets as they tighten their purse strings鈥攁nd retail sales expected to rise just 1.5% YoY this year鈥攄ifferentiation is more important than ever.

The news: TikTok commerce traffic has trended down throughout 2025 amid uncertainty about the app鈥檚 future in the US. Our take: Trump鈥檚 extension gives TikTok more time to reach a deal but does little to ease the internal disruption from ByteDance鈥檚 austerity drive. New tariffs and the elimination of the de minimis exemption could hinder TikTok Shop鈥檚 performance.

The news: As the 2025 economy tightens under the pressure of tariffs, AI disruption, and shifting global trade policy, brands are embracing adaptability. Retail growth forecasts have been slashed, inflation-wary consumers are scaling back, and even luxury sentiment is weakening. Our take: Resilient brands are leaning into agile planning, reallocating media spend to ROI-focused channels like search and digital out-of-home, and anchoring value in trust and quality鈥攏ot just price. As emotional volatility shapes consumer decisions, marketers who show relevance and reassurance will lead. The brands that win won鈥檛 wait for stability鈥攖hey鈥檒l build strategies that succeed amid constant change.

The news: Banks shouldn't use a single marketing strategy for all young people鈥擬illennials (born 1981-1996) and Gen Z (born 1997-2012) have distinct financial behaviors. Millennials, shaped by economic uncertainty, seek stability and pragmatic digital tools, valuing expert advice. Gen Z, digital natives, demand effortless speed, are influencer-driven, and focus on immediate experiences, often skeptical of traditional banks. Our take: Marketing must be tailored. For millennials, emphasize trust, reliability, and security for long-term goals, offering expert education. For Gen Z, highlight speed, flexibility, and convenience through engaging, short-form content on platforms like TikTok, utilizing influencers to build rapport.

The trend: Value-seeking behavior is on the rise, though not without some volatility, per Deloitte. Our take: Consumers鈥� growing focus on value doesn鈥檛 necessarily mean they want the cheapest option. In fact, up to 40% of how consumers evaluate value comes from nonprice factors, per a separate Deloitte study. That鈥檚 a critical distinction for brands. While it can be tempting to lean into discounts, a narrow focus on price cuts can hurt long-term brand equity. Brands that offer added value鈥攖hrough better quality, service, loyalty programs, or other innovations鈥攁re seeing stronger purchase intent and increasing consumer share.

The rest of the year is top-of-mind for leaders in marketing and retail, which they expect to be challenging but riddled with opportunities to stand out from competition.

The situation: The escalating US-Iran conflict threatens to unleash fresh headwinds for the retail industry, which is already under pressure from the Trump administration鈥檚 shifting trade policies. Our take: Uncertainty has loomed over the industry all year, making it increasingly difficult for retailers to plan ahead with the Trump administration鈥檚 shifting trade policies. Case in point: The 90-day reciprocal tariff pause is set to expire on July 9, and there鈥檚 little clarity as to whether it will be extended or if the sweeping levies will take effect. The escalating US鈥揑ran conflict only adds to the volatility, compounding the pressure on retailers. Together, these factors make it increasingly likely that the operating environment will remain murky for the remainder of the year.

The insight: Amazon is trying to make a bigger name for itself in the luxury sphere鈥攁 strategy that could help soften the blow from tariffs. Our take: That designer brands and retailers are eager to partner with Amazon despite its mixed track record in luxury shows the state of the industry, which is under serious pressure as economic uncertainty saps even affluent consumers鈥� desire to shop. Amazon鈥檚 extensive reach鈥攖hree-quarters of US households are Prime users, per our forecast鈥攁nd ability to drive spending even in times of volatility are making it an increasingly valuable partner for any brand looking to drive sales in an unsettled environment.

The trend: Casual dining chains that lean into value are luring cost-conscious consumers, even as broader economic uncertainty tempers discretionary spending. Our take: Consumers haven鈥檛 stopped dining out, but they鈥檝e become more selective. They鈥檙e increasingly looking for value experiences that offer more for their money. That shift is pressuring some parts of the industry. Quick-service chains like McDonald鈥檚 and fine dining brands like Darden鈥檚 Ruth鈥檚 Chris and The Capital Grille are feeling the squeeze. But it鈥檚 providing an opportunity for casual dining chains that offer affordable indulgences. Their combination of sit-down service and budget-friendly pricing is hitting the mark.

The news: US retail sales fell more than expected in May from April, the latest sign that tariff fears and economic volatility are affecting consumer spending. Our take: While May鈥檚 retail sales data largely show that consumers are hanging in, the situation remains unpredictable鈥攅specially given the fact that tariff-driven price hikes have yet to kick in for a multitude of everyday purchases, including groceries and apparel.

The news: Pinterest is partnering with Instacart to allow advertisers to power their campaigns using the latter鈥檚 first-party data鈥攁 move that will enhance the value of both companies鈥� ad platforms while advancing Pinterest鈥檚 shoppable ambitions. Our take: Pinterest鈥檚 ability to engage the all-important Gen Z cohort, along with its role as a source of inspiration and product discovery, is making it a more strategic asset for brands and retailers. As economic uncertainty drives companies to be more careful with their ad dollars, Pinterest鈥檚 ability to reach audiences at every stage of their customer journey鈥攏ow bolstered by access to Instacart鈥檚 first-party data鈥攑ositions it as an even more valuable partner.

The news: Auto parts maker Marelli filed for Chapter 11 bankruptcy, making it one of the first high-profile casualties of the Trump administration鈥檚 tariffs. Our take: Not all of Marelli鈥檚 problems can be blamed on tariffs. But tariffs and uncertainty have a way of magnifying the cracks in a company鈥檚 business鈥攃racks that will become harder to paper over the longer the Trump administration sticks to its hardline tariff policies.

The insight: The US is mired in the 鈥渨orst housing market in almost 50 years,鈥� RH CEO Gary Friedman said during the company鈥檚 Q1 earnings call, as high housing costs and economic uncertainty chill demand. Our take: With the sluggish housing market showing few signs of improvement, retailers must lean into any pockets of opportunity they find. For RH, that鈥檚 burnishing its luxury credentials and pushing deeper into hospitality, while Wayfair is leaning on its diverse supplier base. The resilient pro market is another area companies should look to take advantage of as they try to ride out the downturn.

The trend: Retailers and brands are rapidly weaving generative AI (genAI) into their operations to boost efficiency and scale without adding significant headcount. The breadth of the initiatives signals an abrupt shift in many companies鈥� thinking about genAI from a useful tool to a potential core business driver. Our take: GenAI enables companies to do more with less鈥攁 crucial advantage at a time when macro uncertainty is making many firms wary of increasing their headcount. As early adopters scale their efforts and share results, momentum will grow鈥攑rompting others to follow out of necessity, not choice.

The news: The UK economy contracted by the most in 18 months in April due to the twin pressures of tariffs and tax increases. Our take: The UK economy鈥檚 contraction in April sets the stage for another year of tepid growth. Despite a highly publicized (and yet to be finalized) trade deal with the US, macroeconomic uncertainties are set to weigh heavily on corporate and consumer sentiment, while rising household and business expenses will limit investment and consumer spending.

The news: WPP Media has lowered its global ad spend forecast for 2025 by 1.7%, reaching 6% compared with the 7.7% projected in December. The downgrade is attributed to ongoing trade wars resulting from President Trump鈥檚 current tariff policies, with WPP Media president Kate Scott-Dawkins citing 鈥涡苍肠别谤迟补颈苍迟测.鈥� Our take: Despite global uncertainty, advertisers who remain flexible with data-informed pivots, prioritize performance marketing, and plan for uncertainty will come out on top.

The insight: Growing GLP-1 usage could reduce McDonald鈥檚 annual sales by as much as $428 million, or 1% of system sales, according to an analysis by researchers at Redburn Atlantic. The impact could widen to 10% or more 鈥渙ver time,鈥� the analysts wrote, for brands like McDonald鈥檚 that are 鈥渟kewed toward lower-income consumers or group occasions.鈥� Our take: GLP-1s are just one of the many factors influencing what consumers eat. With economic uncertainty looming large, financial concerns are the biggest consideration for the majority of consumers鈥攚hich is why households are choosing to eat at home more often and increasingly opting for private labels at the grocery store.

The perception problem: Even without sharp increases at checkout, the psychological toll of economic uncertainty and trade-related volatility are making consumers more cautious and value-focused.

Sixty percent of current and prospective homeowners are unsure whether it鈥檚 a good time to buy a home鈥攖he highest uncertainty in three years, per Bank of America鈥檚 report. Meanwhile, 75% of prospective buyers are waiting for mortgage rates to drop, up from 62% in 2023. Younger generations, especially Gen Z and millennials, are delaying homeownership, with ownership rates flatlining. Stagnant rental prices and economic uncertainty add to the hesitation. Lenders must modernize offerings, streamline processes, and explore alternative financing like crypto and peer-to-peer loans to convert hesitant buyers when the market improves.