Navigating holiday pricing: Competitoor data reveals the impact of tariffs on consumer spending

Navigating holiday pricing: Competitoor data reveals the impact of tariffs on consumer spending

As global trade tensions and tariffs continue to reshape the retail landscape, Competitoor’s latest market intelligence has once again been recognized by international media. Retail Dive, a leading U.S. publication covering retail industry trends, has cited Competitoor’s data in a recent article analyzing how tariffs are influencing prices as the holiday season approaches.

Retailers face a delicate balance between margins and demand

According to Moody’s Ratings, retailers and brands throughout 2025 are facing increasing pressure to adjust prices in response to tariffs. Many companies have communicated to investors that they will raise prices where possible to protect profit margins. However, this strategy comes with challenges, as consumer demand remains sensitive to higher prices and a cooling job market.

Executives from major retailers like Target and Walmart have expressed caution. Target CEO Brian Cornell described price hikes as a “last resort,” while Walmart’s Doug McMillon emphasized the company’s commitment to keeping prices “as low as we can for as long as we can.” Off-price retailers are also closely monitoring how mainstream competitors manage these increases to maintain their own value propositions.

Consumer spending shows signs of strain

Economic headwinds are beginning to affect consumer behavior. Moody’s reports that tariff-related price increases and a softening labor market have dampened consumer confidence, slowing overall spending.

For instance, real personal consumption expenditures in July grew just 2.2% year over year, compared to growth rates above 3% in late 2024. Although August sales in discretionary categories rose 5.5%, the actual sales volumes remained flat or even declined.

Moody’s analysts, led by Claire Li, expect U.S. consumer spending growth to remain sluggish throughout 2025, with recovery likely beginning only in late 2026. The recovery, they note, will vary widely across income groups and product categories.

While higher-income households continue to spend on discretionary and luxury items, lower-income consumers are focusing on essentials such as groceries. This growing divide is one of the most notable patterns in consumer behavior today.

Competitoor data highlights price increases in key fashion segments

Competitoor’s latest pricing intelligence has revealed that the effects of tariffs are particularly visible in luxury and mid-tier fashion categories. Over the 12 months ending September 5, the following price increases were recorded in the U.S. market:

• High-end luxury handbags: +9%
• Mid-tier luxury handbags: +14%
• Women’s sneakers: +12%
• Women’s boots: +9%
• Women’s denim jackets: +34%

“These price increases reflect new products that have entered the U.S. market subject to tariffs,” explained Maurizio Catellani, CEO of Competitoor. “Brands are strategically adjusting their pricing, focusing on higher-end products — and that’s precisely what our data shows across the categories we track.”

The road ahead: navigating tariffs during the holiday season

As the holiday season draws closer, the challenge for retailers becomes even more complex. According to Wells Fargo analysts, who recently discussed the issue with several retail executives, brands serving lower-income consumers are particularly concerned about the impact of tariffs during the high-demand fall and holiday periods.

“The consumer seems to be hanging in, with elasticity encouraging,” Wells Fargo noted, “but the September shoulder period is a question as tariff pricing ramps into fall and holiday.”