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Dollar General benefits from 鈥渢rade-in鈥� behavior among wealthier shoppers: The retailer boosted its outlook as discretionary spending from higher-income consumers offset lower-income caution.

The news: Lululemon beat earnings expectations and met revenue forecasts in Q1, but softening demand in its core Americas market cast a shadow over the results. Our take: Even premium brands aren鈥檛 immune to macro pressures. As consumers grow increasingly cost-conscious, discretionary purchases鈥攅specially those with big price tags鈥攁re easy for consumers to postpone. Lululemon鈥檚 challenge now is not just product innovation, but convincing shoppers its value proposition is worth the premium.

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: Klarna partnered with Nift, a gift platform, to offer 鈥済ift鈥�-style rewards for customers鈥� BNPL purchases. Our take: Until they can close that gap, BNPL players will struggle to attract a meaningful share of shoppers. It鈥檚 one reason we forecast BNPL user growth will slow every year through 2029.

Rival American Eagle鈥檚 attempt to stock up on inventory ahead of tariffs resulted in a $75 million write-down after shoppers showed little interest in its spring-summer collections.

The news: National TV ad revenues will fall 11.4% this year, hitting $35.3 billion, while streamers are expected to rise 26% to $7.8 billion, per a Madison and Wall projection reported by MediaPost. Our take: Advertisers should continue shifting strategies to align with viewing habits and consumer behaviors鈥攂ut remain cautious about complete CTV adoption, as opaque ad placements and looming economic pressures spell an uncertain future.

The news: Facebook is projected to lose users in multiple international markets in 2025, per our May forecast. South Korea and Japan lead with projected declines of -3.2% and -2.2%, respectively, followed by smaller but notable drops in Hong Kong (-1.2%), Brazil (-1.2%), and New Zealand (-0.8%).

Fewer, smaller discounts could make Prime Day less enticing to shoppers鈥攐pening the door to competitors like Walmart that are able to offer better value.

Our take: Demand forecasting has rarely been more challenging. Retailers that can read the tea leaves to anticipate how trade policies will evolve鈥攁nd how consumers will respond鈥攕tand to gain an edge. But that鈥檚 far easier said than done.

This report presents five of the most intriguing and/or under-the-radar forecasts for 2025 that clients should be aware of, as compiled by our forecasting team.

US ecommerce sales will be hit hard by tariffs: Many online platforms鈥� advantages could disappear as prices rise, inventory runs dry, and delivery times slow.

As a result, we expect a sharp deceleration in retail sales growth to just 1.2% in 2025鈥�1.7 percentage points below our pre-tariff forecast. Go further: Check out our tariff coverage, including our Live FAQ: The Impact of Trump鈥檚 Tariffs on Consumers, Businesses, and Trade, as well as our report on the Impact of Tariffs on US Businesses.

Under our 鈥渕oderate鈥� tariff scenario, we forecast retail sales will grow just 1.2% this year鈥�1.7 percentage points below our pre-tariff forecast. And with trade policies still in flux, further disruption could lie ahead.

The news: American Airlines, Southwest Airlines, and Alaska Airlines were the latest carriers to pull their full-year forecasts, citing unpredictable travel demand in the wake of tariffs and economic uncertainty. The situation: Lackluster earnings from all three airlines clearly demonstrate that consumers are in no mood to travel, at least in the short term.

Several foreign carmakers saw US sales surge in March: But that momentum is likely to stall given the 25% tariffs on imported vehicles and imported auto parts set to take effect by May 3.

The good news: Inflation was slightly lower than expected in April, per the US Labor Department. The Consumer Price Index (CPI) rose 2.3% YoY鈥攊ts lowest annual increase since February 2021 and just below analysts鈥� expectations of 2.4%. CPI increased 0.2% MoM, in line with forecasts. Core CPI, which excludes volatile food and energy prices, rose 2.8% YoY and 0.3% MoM, both matching expectations.

In today鈥檚 episode, we talk about how much debt consumers have, which buckets it lives in, and the likelihood of a 鈥榙ebt jubilee鈥�. Join the discussion with host and Head of Business Development Rob Rubin, Senior Analyst Grace Broadbent and Senior Director of Forecasting Oscar Orozco.