Retail Customer Experience Mentions First Insight | Retailers Boosting Prices Despite Expected Consumer Backlash
A hefty number of consumers, 79%, will pledge loyalty to retailers that absorb tariff costs and lose trust in those that raise prices, according to a First Insight study regarding tariffs and impact on pricing and consumer reaction.
A majority of company leaders, 83%, are raising prices despite the expected fall out with shoppers, according to a press release on the findings.
The report, "Tariffs & Trust: Why Retailers Risk Loyalty with Price Hikes Study," reports 68% of brand and retail executives expect a negative reaction from customers.
Additional findings include:
- Nearly one-third of shoppers (30%) said any increase at all would cause them to shift their spending habits.
- 24% said they fully believe tariffs alone are the reason for rising costs.
- 54% acknowledged that government policy is driving up costs.
- Nearly 3 in 4 (73%) of retail executives said they believe price increases will go into effect by the end of summer.
- The majority of executives (60%) said that if they raise prices, they expect to lose market share to competitors that don't.
"We can hear shoppers' voices loud and clear, and now is the time for retail executives to put what they're saying to work," Greg Petro, CEO of First Insight, said in the release. "While most retailers won't be able to avoid raising prices altogether, unilateral price increases are a surefire way to lose customer confidence and trust. There are more informed ways of approaching pricing strategies and offsetting the burden on customers. Customers are forthcoming about what they'll spend, what they'll buy and where they'll tap out–retailers simply need to engage them and communicate what they're up to every step of the way."
Read on Retail Customer Experience.
