What Power Digital Experts Are Saying About Tariffs, Fashion, and the Future of Pricing

The fashion industry is no stranger to disruption. But rising chatter around new tariffs—especially in light of recent geopolitical and economic statements—has pushed one big issue back into the spotlight: sourcing risk and its ripple effect on pricing, margin, and marketing strategy.

But let’s be clear: tariffs are just one piece of a much bigger puzzle.

“Businesses don’t operate well in an environment of uncertainty… scenario planning is critical.” —Hanna Lane, Group Director, Fashion at Power Digital

Whether or not your brand is immediately impacted, now’s the time to get proactive. The combination of tariffs, inflation, and shifting consumer behavior is creating unprecedented pressure on profitability. The brands that win in this environment won’t just be playing defense—they’ll be scenario planning, reallocating spend, and moving fast on high-leverage opportunities.

Let’s break down how top brands are adapting—and the strategic pivots we’re seeing right now.

1. Price Increases: The First (and Most Common) Move

Raising prices is often the first response to margin pressure—but fashion brands must tread carefully. In trend-driven or value-focused segments, customers are highly price-sensitive. Without a shift in acquisition or retention strategy, price hikes can backfire fast.

What smart brands are doing:

• Testing high-margin products and being transparent about price increases to maintain trust
• Targeting audiences with higher price tolerance and reinforcing value
• Elevating the brand experience to meet rising customer expectations

When you raise prices, you also raise customer expectations. That means your funnel, brand experience, and retention engine must rise to meet the moment.

2. Margin Down, Market Share Up

Some brands are taking a different approach: absorb the costs, hold prices steady, and capture share while competitors pivot.

This strategy can work—but only with a rock-solid understanding of performance metrics like:

• Cohort-level repeat rate
• True LTV and payback windows
• Contribution margin forecasts (not just gross margin) 

This approach is especially suited for brands with strong retention loops, high purchase frequency, or clear subscription paths. It also requires ruthless spend efficiency—cutting low-return channels and reallocating to high-iROAS opportunities.

3. Sourcing Shifts: Tariffs as a Wake-Up Call

Tariff talk is pushing many fashion brands to re-evaluate their supply chain—not just for cost mitigation, but long-term resilience.

Brands are exploring nearshoring, supplier diversification, and contract renegotiations. But it’s not about perfection—it’s about creating flexibility.

Steps smart brands are taking:

• Auditing which SKUs carry the highest tariff exposure
• Scenario planning around 10–20% tariff increases
• Aligning sourcing decisions with customer promises (speed, sustainability, quality) 

4. Marketing & Media: Efficiency > Everything

With costs rising across the board, ad budgets are under the microscope. But indiscriminate cuts are a fast track to acquisition slowdowns and inefficient spend.

As Power Digital CSO Ben Dutter said, “Highly efficient, incremental customer acquisition — irrespective of price and investment — is going to be the lifeblood of most businesses until they become category leaders.”

Translation: It’s not about spending less—it’s about spending smarter.

Power Digital’s Strategy Team is helping marketers forecast outcomes, model spend scenarios, and build resilient plans. Want to learn how we’re using incrementality to uncover wasted ad spend? Check out Dutter’s latest post on LinkedIn.

Power Digital’s Offensive Strategies Against Tariffs: A Checklist for Fashion Brands

Tariffs might not hit your brand directly this quarter. But the strategic pressure they represent is already reshaping the way top fashion brands operate. Before you go, here’s a quick checklist to help future-proof your brand against tariff volatility:

• Refine Your Brand Story: Elevate messaging around quality, sustainability, and craftsmanship. Highlight why your brand is worth the investment. 
• Launch Strategic Bundles & Tiered Pricing: Offer seasonal “Curated Looks” or “Capsule Collections” to increase AOV and provide styling value. 
• Double Down on Loyalty: Strengthen or launch a loyalty program that offers early access, exclusive drops, and rewards for wardrobe building. 
• Communicate Transparently: Educate customers on pricing changes due to tariffs through honest, value-driven storytelling—not apologies. 
• Run Margin-Smart Promotions: Use GWP (gift with purchase) offers, free shipping thresholds, and limited-time sets to protect brand perception and preserve profitability. 
• Overhaul Your Product Feeds: Refresh DPAs to prioritize high-margin products and best-performing personas. Cut underperforming SKUs from ad feeds. 
• Lean into High-ROAS Channels: Focus ad spend on high-converting audiences. Boost retargeting efforts and blend in influencer/UGC for authenticity. 
• Test New Market & Channel Expansions: Try DTC-only drops, virtual trunk shows, or marketplace ads that offer scale with control over margins.

At Power Digital, we help brands navigate change—whether it’s platform shifts, pricing pressure, or global curveballs. If you’re looking for a strategic partner to protect margin, optimize acquisition, and stay ahead of disruption, we’re here to help.