Turning Ad Spend Into a Competitive Advantage During Uncertain Times

Tariffs are the latest hot topic, and they’re already shaking up paid media strategies across many industries.

With costs climbing and uncertainty rising, it comes as no surprise that a recent Interactive Advertising Bureau poll found that 94% of advertisers are worried about how these tariffs could impact their budgets. And with social media ad spend expected to drop by up to $10 billion by 2026, these concerns aren’t just noise.

Let’s be honest—I’m not an economist. And Workshop Digital isn’t in the business of economics, either. But we are digital marketing experts. And from my perspective, this isn’t just a challenge, it’s an opportunity to rethink the way we invest. It’s a chance to pause, re-prioritize, and get more intentional about where your marketing dollars are going.

In this post, I’ll break down what’s happening, why it matters for marketers, and tips on how you can build a solid strategy, even in uncertain times.

In early 2025 (and ongoing), President Donald Trump proposed a new wave of tariffs, reigniting economic uncertainty across the U.S. These tariffs target a wide range of imports, raising red flags for businesses facing rising costs across the board.

The timing is notable, as it comes on the heels of a record-breaking 2024, which saw the fastest U.S. ad spend growth since the 1980s. But in response to the proposed tariffs and anticipated inflation, eMarketer has already revised its 2025 U.S. ad spend growth forecast downward, from 7.5% to 6.3%.

Now, as operating costs rise, businesses are reevaluating their budgets, including what they put into advertising. And if it all feels a little familiar, that’s because it is. Just like during the pandemic in 2020, marketers are back to juggling shrinking budgets with existing performance expectations.

Once again, we’re shifting from spending more to spending smarter with less.

The full impact of the tariffs is still unfolding, but the early signals? They’re hard to ignore. Brands across industries are already making adjustments. They’re not pulling the plug entirely, but they are adjusting strategies and reallocating budgets toward channels that prove their worth.

Spending Shifts Are Already Under Way

Retail giants like Temu and Shein, previously two of the most aggressive U.S. advertisers, have dramatically dialed back their spending:

• Temu slashed its ad budget across Meta, YouTube, and X by 31% in early April

• Shein cut U.S. ad spend by 19%, with the biggest pullback on YouTube

They’re not alone.

According to a recent IAB survey:

• 45% of advertisers plan to reduce their overall ad spend

• 41% expect to cut back specifically on social media platforms

It’s a trend we’ve seen before. When budgets tighten, upper-funnel brand awareness campaigns are often the first to go. What’s rising instead? Paid search, performance media, and anything with a clear ROI.

Projected Ad Spend Cuts by Channel Due to Tariffs

Social media, display, and video channels are expected to take the biggest hits. Typically, these channels focus on top-of-funnel (TOFU) awareness and are harder to justify when budgets are tight and marketers need to prove short-term ROI. Paid search, on the other hand, is holding strong thanks to its trackability, efficiency, and performance-focused nature. Paid search tends to target users who are either actively searching for a solution or are ready to convert.

As economic conditions continue to change, cost control, adaptability, and transparency are moving to the top of the priority list for marketing teams. The brands that succeed won’t be the ones that pause, they’ll be the ones that pivot with purpose.

We get it—things feel shaky at best. The headlines are loud, budgets are tight, and the instinct to pause or pull back on ad spend is totally understandable. But if history (and data) tell us anything, the opposite is true. Going dark is rarely the answer.

Yes, budgets are tighter. But expectations? They’re still sky high. And while people may be shopping less, they’re still shopping (especially for the things they need). When visibility drops, your brand becomes easier to forget. And when you go quiet, competitors who stay active stand out.

The brands that get it are leaning into:

• High-intent, conversion-focused campaigns (think paid search, remarketing, and shopping ads).

• Flexible, test-and-learn media plans that can scale up or down depending on market conditions.

• Channels with crystal clear attribution, because when every marketing dollar is under scrutiny, measurable performance is worth its weight in gold.

So why stay active when the outlook feels shaky? Because the brands that do tend to come out ahead. Just look at the track record. Research from Harvard Business Review, McGraw-Hill, and other independent studies shows that brands that maintain or strategically adjust their marketing spend during economic downturns tend to outperform competitors in the long run.

• After the 2008 recession, companies that stayed visible saw up to 3.5X more brand visibility and recovered faster.

• A McGraw-Hill study found that during the 1980s recession, brands that maintained or increased spend saw 256% more growth than those that cut back.

• And in 2023, Nielsen reported that cutting ad spend by 50% can drop brand awareness by 25%, while investing during a downturn can boost share of voice as competitors retreat.

To put it simply, going quiet can cost you more than staying present ever will.

We’ve seen it firsthand. During the pandemic, one of our clients had to drastically reduce their paid media budget. But instead of disappearing, we helped them double down on what was working. We optimized targeting, reallocated spend, and focused on results. The outcome? Better leads. Lower costs. Stronger strategy. You can read the case study if you’re interested.

This is the kind of moment that rewards intentionality. The brands that stay focused and flexible? They’re the ones who come out stronger on the other side.

I’ll say it again, I’m not an economist. But as a digital marketing expert, when it comes to making the most of your marketing budget in uncertain times, we’ve all been there before.

If your team is tightening the purse strings (or just trying to do more with less), here are a few things worth considering. These aren’t hard rules, just strategic starting points we’ve seen work for clients facing similar challenges.

Tips from Workshop Digital

1. Prioritize What You Can Measure

Now is not the time to hope something will stick. Focus your budget on ROI-driven paid media channels—like Google Search, Performance Max, and remarketing—that deliver measurable results and actionable insights. They’re built for high intent and high accountability, and right now, that’s everything.

2. Let Your Data Do The Talking

Before you make cuts, dig into your performance data. Look at conversion rates, cost-per-lead, and return on ad spend (ROAS) by campaign, keyword, and audience. Reallocate spend toward your top performers. Pause what is underperforming, and test incrementally before scaling. This isn’t the time to trust your gut; trust the data.

3. Tighten Up The Funnel

Clicks are only valuable if they convert. Use this time to optimize landing pages, reduce any friction with your forms, and ensure your CTAs align with user intent. Test the alignment between your ad copy and landing pages across your paid search campaigns. Check your quality scores — they’re a great indicator of relevance and user experience. Even small UX or content updates can dramatically improve cost per acquisition (CPA).

4. Stay Flexible

Make sure you’re building campaigns that can flex with the market. That might mean automated bidding strategies or quickly pausing low-intent audiences. Make sure your budget isn’t locked into underperforming tactics. The most resilient plans are responsive and data-led. Do not even think about set-it-and-forget-it strategies right now (or ever)!

5. Lean on Your Experts

You don’t have to figure this out on your own. We’ve helped clients pivot during turbulent times before, focusing their budgets away from top-of-funnel awareness campaigns toward high-converting paid search and remarketing campaigns, even on tighter budgets. The result? Better performance with fewer dollars spent.

If you take anything from this, let it be that now is not the time to pause your digital marketing efforts. It’s time to refocus, reoptimize, and re-strategize by leaning into data-driven decision-making and prioritizing what works.

Yes, the economic outlook is messy. But within that uncertainty is room for innovation, efficiency, and momentum.

Not sure where to start? That’s okay. The smartest thing you can do right now is bring in an experienced PPC agency that can help you stretch every dollar and build a strategy that performs today and positions you for long-term success.

At Workshop Digital, we’ve helped brands navigate change, challenge, and everything in between. Whether you’re looking to reduce costs, improve lead quality, or future-proof your funnel, we’re here to help you figure out your next move! Request a strategy session today.