Why Retailers Should Get Ahead Of Price Increases With Pre-Tariff Sales

Forbes

06-05-2025

'Americans are broadly skeptical that Trump's recent wave of tariffs will yield meaningful economic ... More benefits, particularly in the short term,' Gallup's Megan Brenan wrote. (Photo by Lian Pan/China News Service/VCG via Getty Images) China News Service via Getty Images
With tariffs threatening retail prices across the board, retailers have begun to host pre-tariff sales to encourage shoppers to buy now before they are forced to increase prices. Retailers, including intimates brand Bare Necessities, mattress maker Saatva and furniture retail Raymour & Flanigan, have used the tariff disruption as way to encourage customers to buy now.
It's not like retailers need an excuse to hold a sale, but this surely gives them a new opportunity and it offers more branding upsides than a typical sales promotion.
American consumers overwhelmingly expect tariffs to increase the cost for everyday purchases. By giving them a chance to get ahead of price increases, retailers are doing a value-added service for their customers. It's an act of good will that retailers hope will be remembered once the tariff uncertainty is resolved
'The tariffs are injecting uncertainty into the marketplace and when there is high uncertainty, consumers tend to overestimate their losses, so they try to hedge their losses as much as possible in a very irrational way,' Denish Shah, professor of marketing at Georgia State University's Robinson College of Business, told CBS MoneyWatch.
Offering a pre-tariff promotion gives retailers a consumer-psychology edge. 'Consumers are very price-sensitive in this environment, so they are going to react very strongly to sales that companies are promoting,' Shah continued.
Tariffs To Do More Harm Than Good
Nearly 90% of Americans expect Trump's tariffs to increase retail prices, according to a Gallup panel online survey conducted from April 2-15, after President Trump announced the administration's tariff policies. Some 66% of consumers said higher prices were 'very likely' and another 23% said price increases are 'somewhat likely.'
Over both the short and long term, most Americans believe tariffs will end up costing the U.S. more money than tariffs bring in from other countries – 70% in the short term and 62% in the long run.
In addition, consumers signal little willingness to accept disruption caused by tariffs. Nearly one-third said they won't tolerate any disruption to their lifestyles, while 63% will put up with it for a few months. Any longer could be disastrous from a public opinion perspective.
'Americans are broadly skeptical that Trump's recent wave of tariffs will yield meaningful economic benefits, particularly in the short term,' Gallup's Megan Brenan wrote.
'As economic consequences continue to unfold, public opinion may prove to be another constraint on how far the U.S. can go in reshaping its trade relationships through tariffs. These findings suggest a challenging political environment for sustaining aggressive tariff policies, particularly as the public's appetite for disruption is limited,' she continued.
Consumer Psychology To The Rescue
As Professor Shah noted, consumers feel a sense of urgency to buy before prices rise. This is due to the loss-aversion cognitive bias. People instinctively feel losses more greatly than potential gains so they are more likely to act to avoid losses than to achieve gains.
Pre-tariff sales framed as a way to avoid future losses from tariff price hikes plays right into this bias, as does the fear-of-missing-out by not taking advantage of time-sensitive deals.
Bare Necessities used loss-aversion framing in a recent 30% discount offer. 'Tariffs? No clue. A good deal? We got you. Save up to 30% before prices shift,' it said in a text message.
Raymour & Flanigan did much the same, reminding customers to 'lock in pre-tariff pricing' on a website banner, though it didn't indicate how much prices might increase.
Retailers can also use the anchoring effect to their advantage in the current uncertain climate. The anchoring effect is a cognitive bias where people depend on the first piece of information to make decisions. Presenting the higher price that could result from tariffs first will make the pre-tariff sale price that much more appealing.
And by encouraging customers to take advantage of pre-tariff prices, retailers use the recency bias to remind them that the brand is looking out for them. This is the cognitive bias that causes someone to remember their most recent brand experience more clearly than previous ones.
Saatva took advantage of this with a recent three-day 15% off sale. 'The messaging was timed to something that customers are thinking about,' shared Saatva's director of public relations Sahri Ajayi with Modern Retail, adding the sale was a 'positive value-added service.'
'We know that Americans are going to see shifts in a direction they're not wanting to see prices go, so we wanted to make sure we were doing something that is helping customers,' she continued.
Nothing To Lose, Everything To Gain
As retailers and their customers prepare for price increases to hit, some brands are thinking about deflecting the responsibility by adding 'tariff surcharges' at checkout, something that Amazon considered but quickly pulled back after taking heat from the White House.
Pointing fingers and shifting blame is not a good look for retailers, especially for their Republican-leaning customers who stand behind Trump's policies. Gallup found that an overwhelming majority of Republicans believe tariffs will bring in more money to the U.S. economy, 63% in the short term and 77% over the long run.
Getting out in front of tariffs with pre-tariff promotions is a way retailers can help consumers now and be a force for good in what otherwise could be a bad situation. After all, we are all in this together.
Wharton School professor of marketing Barbara Kahn advised brands to stay positive and use humor in sales messaging to avoid alienating customers from one side of the aisle or the other.
'They don't have to take sides because the tariffs are not only an economic mechanism, they are linked to political beliefs. You are seeing a lot of brands trying to neutralize some of the political statements that they've made in the past, so I think something like humor would diffuse any kind of political issue and just make it into something: 'Here's a good deal. Take advantage of it.'
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