When China looks west: what EU brands need to prepare for
Soon after this article was published, the US and China agreed to temporarily reduce the punishing increase in tariffs announced earlier this year for 90 days as they continue trade negotiations.
The final outcome of these ongoing negotiations remains uncertain. In the meantime, it is critical for brands to stay ahead by staying prepared.
As the US escalates tariffs on Chinese imports, with rates reaching up to 145% on consumer-facing goods, global trade patterns are being forced to shift.
That pressure has to go somewhere. And increasingly, it’s heading for Europe.
For EU marketers, the implications are immediate. If Chinese producers can’t access the US at the scale they’re used to, they’ll look westward. And, European markets are open, sizeable, and already price-sensitive.
In the coming months, we can expect to see a wave of redirected goods entering the EU. Not just components and commodities, but finished products that go head-to-head with what many European brands currently sell, often at prices that are hard to match.
This isn’t a theoretical exercise in trade policy. It’s a clear and present challenge for any marketer trying to defend pricing, retain customers, and preserve brand equity.
Discount retail is already paving the way
Europe isn’t just a logical destination for diverted Chinese exports. It’s increasingly well set up to receive them.
Retailers like B&M in the UK and Pepco across Central and Eastern Europe are purpose-built to distribute low-cost, fast-moving goods. These chains are expanding fast, taking share from both mid-market and premium players. And they offer Chinese suppliers a frictionless route to European consumers, often without the need for local brand-building or marketing investment.
Kantar data shows that discount retailers now account for over 18% of FMCG market share in Western Europe, up from just 14% five years ago. This isn’t just a niche trend. It’s a systemic shift. And it’s only likely to accelerate as more supply enters the market looking for a home.
For consumers, this means more low-cost options and greater exposure to unfamiliar brands. For marketers, it means defending not just against traditional competitors, but against entire supply chains repositioning themselves to win on volume and velocity.
Marketers can learn from Europe’s solar panel industry, once a global leader which now imports over 95% of its modules from China. Multiple EU manufacturers have collapsed in the past 18 months, unable to compete on price, not because their products were worse, but because they waited too long to adapt. The cost of complacency, in that case, was the dismantling of an entire sector.
Holding your ground means proving your worth
When consumers see cheaper alternatives, they reassess. Not just the product they’re looking at, but the brands they’ve bought from in the past. In categories already affected by inflation and price fatigue, this new influx could lead to a fresh round of value-switching.
The answer isn’t to race to the bottom. It’s to reinforce the value that justifies your price – in ways that go beyond product features.
Brands can navigate pricing pressure by reframing the customer relationship. That means:
- Reasserting value through content, service, and transparency
- Using experience and consistency as loyalty drivers
- Telling the story behind the price — especially where provenance, sustainability, or service levels support it
The reality is, not every customer is trying to pay less. But every customer wants to feel they’re getting more. In volatile markets, value is psychological as much as it is financial.
Find your risks before your customers find alternatives
One of the simplest ways to defend loyalty is to act before it’s tested. That means identifying which customers are likely to defect, and why, before they do.
You don’t need to guess. The signals are already there:
- Smaller baskets
- Longer gaps between purchases
- Drop-offs in referrals, reviews, or email engagement
These behaviours often precede churn. And while not every at-risk customer can be saved, many can, if the right message or offer reaches them in time.
At DEPT®, we help brands use first-party data not just for personalisation, but for churn prediction and defection mitigation. For example, we developed an AI model for a skincare brand to predict what product a customer will buy next and show it across all channels.
It’s about using the data you already have to deliver offers, content, and experiences that keep value-conscious customers engaged without cheapening the brand in the process.
Use the disruption to redefine your advantage
It’s easy to view trade volatility as a threat. But for strong brands, it’s also an opportunity. Because when price becomes noisy and confusing, customers don’t just look at the numbers. They look at what they know and trust.
That’s where brand equity pays dividends.
If your products are manufactured closer to home, if your sourcing is ethical, or if your aftercare genuinely sets you apart, now is the time to say so. These are attributes that matter more, not less, when the alternatives multiply and the differences between them blur.
We worked in the past with Patagonia on its flagship digital experience and needed to strike the balance between culture, business, and the environment. One that begs consumers to consider the impact of their choices—right down to the clothes they wear. The reimagined eCommerce platform serves as a brand hub for both activism and content, and gently educates shoppers on how products are made and the impact it has on the planet.
While not every brand can be the cheapest, every brand can be clear. Clarity builds trust. Trust builds margin.
A moment to sharpen, not just survive
What happens when China looks west? European consumers get more choice, lower prices, and more reasons to reappraise what they buy. European brands get more competition, more price pressure. And more urgency to respond.
But this isn’t a time for panic. It’s a time for precision.
EU marketers can build resilience through clarity, loyalty strategy, and first-party intelligence. Because if you know your customer, and you know what makes you valuable to them, you don’t need to match the lowest price in the market, you just need to make sure you’re worth what you ask.
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