Consumers aren’t the only ones concerned about the very real possibility that prices will rise due to the imposition of tariffs. Retailers are worried that higher prices will be the ultimate “friction point,” driving customers to seek lower-cost alternatives or forego purchases altogether.
Shoppers already are shifting their behavior: A recent consumer survey by SCAYLE revealed that the current economic situation has 36% of shoppers in America prioritizing lower prices over brand loyalty.
But the survey of 1,583 consumers, conducted in January 2025, also carries some good news. Retail brands have access to a wide array of tools they can use to mitigate the impact of price hikes if (or when) they do occur. These include the addition of flexible payment options such as buy now, pay later (BNPL) as well as dynamic pricing tools that can adjust for macro trends, competitors’ pricing and consumer behavior shifts.
Additionally, retailers can work to shore up customer loyalty, which brings a two-fold benefit: mitigating shoppers’ price sensitivity in the short term and building lifetime customer value in the long term. Retailers will need to choose the solutions that offer the best fit for their products, brand promise and customer demographics.
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Among the many options retailers have to pick from, this article will look at three strategic solutions:
- Subscription programs: These are a great way to lock in a predictable revenue source as well as simplify decisions around inventory planning and allocation, and members of Gen Z are fans: 67% of this demographic say they are “likely” or “very likely” to subscribe to such a program, compared to 63% among consumers as a whole.
- Circular commerce: Launching or expanding secondhand, resale or trade-in programs shows thrifty consumers that you are serious about helping them save money, and they also can boost your appeal among shoppers concerned about sustainability.
- Loyalty programs: Not only do these programs provide retailers with invaluable customer data; they also give them multiple ways to offset higher prices via member discounts or non-cash rewards.
Subscriptions Lock in Recurring Revenue and Boost Loyalty
Consumers are primed to sign up for subscription programs; according to the survey, three in five shoppers would subscribe to products that they buy on repeat — but only if they feel the subscription offer is worth it. And as noted above, members of Gen Z are particularly receptive to these types of offerings, so if your customer demographics and products skew younger, a subscription program is even more likely to succeed.
The challenges of creating a subscription program, particularly during an economic downturn, are that consumers are likely to be trimming their subscriptions rather than adding them. This is particularly true with the shift to subscription streaming services rather than bundled cable services; for example, consumers can drop Netflix or Apple+, settling for fewer choices but saving money.
That’s why it’s important for retailers and brands to emphasize flexibility and user-friendliness when crafting their product-based subscription programs. Making it simple and easy for subscribers to skip months or even cancel can, paradoxically, bind them more closely to the retailer. Programs that offer real value, like subscriber-only discounts or early access to product drops, make these programs even more of an appealing value exchange between the retailer and the subscriber.
Saving Money While Saving the Planet with Circular Commerce
One in five (20%) of survey respondents are buying more secondhand, or “pre-loved,” items to deal with economic challenges — a strategy that’s particularly popular with Gen Z (at 21%) and Gen X (23%). Even prior to the current period, the U.S. secondhand market was on a steep growth curve: The 13th annual ThredUp Resale Report showed the secondhand retail clothing market outpacing the market for new apparel by 5X and growing by 14% in 2024 compared to the previous year.
Resale or trade-in programs have the double benefit of not just saving consumers money but also helping curb the overconsumption that strains the planet’s natural resources. For the increasing numbers of consumers who want their purchases to reflect their principles, such offerings will position the retail brand as a friend to both the environment and its customers. This is a particularly strong play for retailers with younger consumers, as Gen Z is the most likely cohort to abandon brands due to ethical issues such as sustainability, employee working conditions and inclusivity, according to the SCAYLE survey.
Gamify Loyalty Programs to Make them Even ‘Stickier’
Retailers that already have a loyalty program in place are in an optimal position to deal with price sensitivity and brand abandonment, and the survey’s results bear this out. Just under half (49%) of surveyed consumers highly value the regular discounts offered by these programs, with 36% prizing other loyalty program benefits such as free shipping and buy now, pay later financing options.
Those discounts are most highly valued by older consumers: 59% of Baby Boomers enjoy this benefit. In fact, nearly one in three shoppers in this demographic engage more with loyalty programs during economic downturns — significantly more than the total average of one in five shoppers.
For shoppers old, young and in-between, retailers can increase the “stickiness” of their loyalty programs with gamification. Just over half (51%) of consumer respondents say loyalty programs or point systems are the most engaging gamified shopping experiences.
Time-limited contests with multiplied points as a prize, sweepstakes for exciting exclusive events or even simple spin-to-win offerings all can keep loyalty program members more engaged.
Additionally, personalizing rewards sends another signal that the retailer places a high value on the member’s business — and that can be the most powerful tool of all in mitigating the “sticker shock” of higher prices. Get more shopper stats to guide your 2025 retail strategy in the US Shopper Survey: What’s Killing Conversions (And How You Can Cure IT)
