Retail Debrief: Listen in for a rundown on the state of consumer sentiment in 2025

The conversation begins with a discussion on the state of consumer sentiment and what various pieces of data show. This includes a look at what various consumer sentiment indexes show — which look more at how people are feeling about their finances, the availability of jobs and other macroeconomic indicators. Many of these indices have hit near-record lows recently. The University of Michigan’s closely-watched consumer sentiment index hit its second-lowest reading on record in April, while in Gallup’s most recent Consumer Confidence Index, a record high 53% of people believe their economic situation is getting worse.

But consumer spending is still holding up. According to the Commerce Department’s Bureau of Economic Analysis, consumer spending was up 0.7% last month; economists were expecting it to be up 0.5%. Anecdotes from brands, meanwhile, reinforce the narrative that people want deals and values. Plus, they are doing a lot of research, they will switch brands if the price is right, and they want brands to talk clearly and transparently about prices.

Later in the conversation, the team talks about how the consumer journey has changed. With people doing more research than ever before, people are taking longer to buy. Data from Klaviyo digs into why people are abandoning carts — in a survey of 500 consumers who have abandoned a cart since tariffs were introduced, 25% of them said they abandoned their cart because they found a cheaper alternative elsewhere. Meanwhile, shoppers are looking for payment flexibility, and more of them are using payment services like buy-now, pay-later. And, companies are investing in brand marketing partnerships and putting more content on their websites to explain their technical differentiators. The goal with all of these efforts is to get front of more potential new customers and to explain why they pick one particular brand over dozens of competitors.

Lastly, the team talks about how brands are responding to all of these shifts. Some brands are making changes to their return policies as tariffs force them to find ways to improve their margins. Others are being more strategic about which SKUs they promote during big shopping moments, and are marking some high-demand items as low or out-of-stock to conserve inventory. And, while lots of brands are experimenting with “tariff sales, not all of them are seeing the same results.”

Press play now to watch the first Modern Retail+ members-only Retail Debrief, and stay tuned for more talks like this soon.