When tariffs hit, how do luxury brands convince consumers to spend even more?

Some Chinese manufacturers on TikTok may have just started using Trump’s tariffs as an excuse to peddle $2 wholesale “Louis Vuitton” bags. But Jhara Valentini has been prepping her luxury clients on how to market during a trade war since last August.

Valentini is the founder and president of Valentini Media Group, an agency whose clients have included Louis Vuitton, the lifestyle brand Goop, and Watches of Switzerland, a seller of brands like Cartier, Rolex, and Patek. Luxury clients bring a wealth of unique consumer behavior data, and their consumers have more drawn-out customer journeys, she told us; high-end brands also often have more variable long-term goals, like engagement and awareness, rather than performance-based KPIs. That is key to how she plans to advise them on navigating the tariffs’ effects, which are levying extra costs on imports from countries central to the luxury sector’s manufacturing and inventory processes.

“Luxury is very atypical,” Valentini said. “I think luxury and heritage and that value perception is going to be the biggest narrative.”

We spoke with Valentini about how tariffs are already affecting luxury brands, and how she’s counseling her clients through a turbulent time.

This interview has been edited and condensed for clarity.

Explain it to me like I’m 5. How are tariffs affecting the luxury sector, and in particular, the brands that you are working with?

My husband and I were actually having this conversation with our kids…So I structured it around a math problem. At the end of the day, especially with [luxury’s] efficiency and lower final-conversion tactics, margin is your main play. Because at the end of the day, margin impacts your profitability. Profitability is when you’re winning. Even if you have a double-digit return on investment, if the margin isn’t there, then you really didn’t make any money…The margin number is obviously going to be dependent on the location…That’s probably the bigger [conversation] within our client set, because we have Europe, Swiss, domestic. There’s so many different variables. Some stuff we do monitor and oversee global distribution, others we only oversee domestic distribution. So how does that margin look regionally? What’s the profitability tactics for each region? They always vary, obviously, but now it’s a much bigger conversation and more pertinent conversation, depending on where the inventory is coming from and what specific tariff number that has.

When you’re thinking about how the tariffs are affecting these profit margins, how is that affecting messaging, especially for luxury brands?

It’s almost like a two-pronged approach. We have our immediate tactics that we’re optimizing into, and then that long-term play. In the immediate, luxury is seeing a surge. We’re seeing conversions go up. In conversion value, we’re up almost 200%. Since the tariff news, consumer cost per acquisitions are down, we’re almost down 16% on average. So we’re seeing a really nice lift. But it also makes sense people are taking advantage of the prices now, because we know they’re going to go up later…Long-term, the play is really going to be storytelling and leaning into heritage, value, context, and that “why” component. The luxury consumer, I think, is going to be much more inquisitive and open to information and education about the products that they’re purchasing…So how can we parlay that into a marketing strategy and conversation that makes sense, that’s digestible, and that’s consistent? The biggest thing that we’re trying to advocate across every channel is consistency of messaging. Because if you’re safe within your messaging, and you’re consistent with it, and that value is always there throughout every touchpoint, pricing doesn’t become secondary, but it’s an easier conversation to navigate because the perception of value is there.

Has luxury always leaned into a little bit of education, or is that a direct result of the tariffs?

It’s always been part of the arsenal, because that’s where that value perception lies. There’s a reason why there’s so much content around how a Birkin is made, how a Patek Philippe Ellipse watch is made. All of those pieces of information give that product item the value it deserves…I think now, because of the conversation that’s happening, I think [people are] going to be a lot more open to engagement with it.

Tell me a little bit about how tariffs are reshaping pricing and product flow in luxury, and then how luxury brands are also adapting their paid media strategy as a result.

Nobody’s scrambling yet. However, we are being so much more intentional when it comes to existing inventory, new inventory, where that inventory is coming from, and the concern around the pricing…From the client side, there’s definitely conversation and concentration around inventory that’s tariff-insulated. Things that won’t get affected so much [are] things that are already in-market, things that are already here. How can we leverage that inventory? What can we do to make sure that that inventory sells? And then [we are] figuring out that path to make sure we have enough inventory in the States as soon as possible to offset anything that’s going to happen.

The other thing that I’m planning for…[is] at the end of the day, your end-of-year numbers are what the big conversation is, so we’re front-ending like crazy. Any type of opportunity and optimization tactic that we can lean into right now to sell product, especially while surges are high, we’re taking advantage of completely to help offset any kind of diminishing returns or things that are happening later in the year.

And then our long-term planning for Q3 into Q4 is always setting up the next year, but I’m looking at the next three years. What are the brand advocacy programs that we can set up? What does customer lifetime value look like right now? What is that going to look like in six months? How can we make sure we retain that consumer through this experience, because it is going to be very fragmented?

People are going to have feelings. Feelings are going to be felt, and there’s going to be so much fluctuation. My goal is to keep that consumer loyal, to keep that consumer happy and educated, and [keep] that value perception strong. That means incorporating a lot more branding plays, and also working with owned and operated channels that don’t cost money. So newsletter, organic, organic social, SMS, whatever kind of delivery method we can use to just maintain that consumer and keep that education and perception value high we’re pushing into, and then wherever we can, tap into that tariff-insulated product inventory.

Is this something you have ever done before, preparing three years into the future for essentially an entire presidential administration?

I don’t plan around presidential elections, but I usually plan around a three-year flight…Especially with luxury, because the path to conversion is long—I mean, we’re talking [about how] sometimes pieces can be between $100,000 and $200,000—sometimes it’s at a six-week program or an eight-week program, but it’s that heritage value perception that we’re trying to set up. So I do typically work and think very future-forward, just because I have to anticipate media changes so much. It’s almost naive to be like, “What we’re doing today is what we’re going to do tomorrow.” Tomorrow can implode on us, so we have to plan ahead, especially this year.