The $380 billion American advertising industry is facing an uncomfortable question: how do you sell products when no one knows what anything will cost tomorrow?
Recent trade policy whiplash has left major advertisers—and their agencies—stuck in place. A volley of tariffs, walk-backs, and reimposed measures targeting key trading partners like China has created what some are calling a worst-case scenario for marketers: no visibility, no stability, and no way to plan.
For companies with deep ties to international supply chains, the confusion arrives at a terrible time. The retail calendar is moving toward mid-year and holiday campaigns, but marketing teams are unsure whether to commit budget to products that might soon become unaffordable or altogether unavailable. From automakers to social platforms to toy companies, executives are reportedly in “wait and see” mode, hoping for clarity that may not come soon.
Ad spending is typically treated as a bellwether for the economy, rising with optimism and falling when recession clouds gather. But in this case, it’s not just pessimism—it’s paralysis. A survey from the Interactive Advertising Bureau earlier this year found that 60 percent of U.S. advertising executives expect their companies to cut ad budgets by 6–10 percent due to tariff pressures. Retailers, electronics firms, and auto brands are among the most likely to slash spending, with the steepest declines anticipated mid-year.
Some companies are trying to turn uncertainty into urgency. Dealerships and direct-to-consumer brands are running last-chance campaigns to “lock in pre-tariff pricing,” hoping consumers will buy now before potential price hikes take hold. Others, like Ford and Stellantis, are leaning into patriotic branding, promoting their U.S.-based operations to buffer against anti-import sentiment. That strategy comes with risk: Stellantis was recently forced to revise its marketing claims after watchdogs flagged language that bent federal guidelines on “Made in America” labels.
Meanwhile, agency giants like Omnicom and Publicis are adjusting forecasts, warning investors about possible pullbacks. Revenue visibility has narrowed. Flexibility is becoming a priority: clients want the ability to cancel or shift ad buys midstream, especially in TV and digital. Digital ads, with their lower costs and real-time performance metrics, are expected to outperform traditional formats in the months ahead.
There is a silver lining. After surviving COVID-19 and the fallout from war in Ukraine, many companies are better equipped to handle volatility. But that doesn’t mean they are eager to spend. The mood, for now, is cautious—if not outright grim.