Trade War-sparked consumer boycotts: Short-lived or sign of a shift?

Canadians woke up with one mother of a Trump-induced hangover Tuesday morning.

America was expected to make the first strike today in what has been repeatedly reported as an economically-crippling trade war with Canada. However, after a 45-minute call between U.S. President Donald Trump and Canadian Prime Minister Justin Trudeau late Monday, the country managed to narrowly escape the 25% tariff – at least until March 1, while the Canadian government works with Trump to come to an agreement on border security and economic concerns.

Trying to make sense of the U.S. president’s end-game can be as frustrating as trying to understand the directives of a bad boss. You know they have their own set of pressures influencing their decisions; they’re just not able to rationally articulate them. So while experts have been trying to make sense of Trump’s rationale since inauguration day, we’ve yet to see which (if there is only one) goalpost the president is aiming at. Over the last few weeks, he’s justified the tariffs by citing a host of issues: drug-related trade, ineffective border security, (false) claims around how U.S. banks operate in Canada and bad trade deals. Perhaps it’s all of those reasons, perhaps it’s none.

What is certain is the fear that tariffs sparked in Canadian consumers and businesses alike, as they spent the better part of last week and the weekend bracing for more economic turbulence. But amid that fear was also patriotism. As nearly every corner of the country pushed to “Buy Canadian,” the trade war demonstrated the potential to reshape consumer behaviour, push brands into new marketing strategies and force policymakers to rethink Canada’s internal trade barriers.

Now, with the tariffs paused, the question remains: Did the threat of a trade war spark an enduring shift in consumer sentiment?

Over the last few days, Canadian citizens prepared to swing their own punch at the U.S. by boycotting Made in America goods. Perhaps it was Prime Minister Trudeau’s blessing on social media to only buy Canadian products in stores, or perhaps it was the horde of provinces pulling U.S. alcohol brands from shelves, but Dr. Mark Cleveland, a marketing professor and consumer behaviour researcher at Western University, said he’s never seen such a swift response from Canadians.

“I was shopping [on the weekend] at Costco and at a local store where we buy fruits and vegetables, and it seemed like everyone was talking about the tariffs. I noticed people doing what I was doing – scrutinizing packaging, checking labels and trying to determine where products were from. Many people are actively looking for alternatives, though it’s not always easy to find them. It depends on the product. In some cases, there are plenty of Canadian alternatives or imports from other non-American sources. In others, finding substitutes is much more difficult.”

Some experts have argued that buying local isn’t as easy as it sounds, with varying disclaimers on products – such as Made in Canada versus a Product of Canada – having different legal thresholds for how much its ingredients (for food and beverages, for example) were sourced from Canada vs. the U.S. According to Global News, Canada’s Competition Bureau allows brands to label goods as a “Product of Canada” if 98% of its contents came from Canada. Meanwhile, “Made in Canada” claims for non-food items are subject to a 51% threshold of Canadian content, according to the report.

In addition to that challenge, Dr. Pau S. Pujolàs, associate professor and associate chair of the Department of Economics at McMaster University, says he sees historical parallels that suggest consumer-led boycotts often lose steam. Having immigrated to Canada from Spain, he previously watched the backlash to Catalonia’s president declaring independence from the country in late 2017. There were similar boycotts by consumers in Spain, which Dr. Pujolàs said had a temporary effect, but did not lead to a lasting economic downturn in Catalonia.

“Many people started boycotting Catalan products. Did it work? Not really. In the short run, yes, there was an impact. But Catalan winemakers adapted. They began exporting more to other European markets, and in the long run, the boycott had little effect. I suspect something similar would happen here. Companies will find strategies to work around consumer boycotts. One way is repackaging a product under a different label. An even simpler solution is to redirect sales to other markets.”

While Dr. Cleveland also agreed that consumers likely wouldn’t have been able to sustain their boycott efforts in the long term, the immediate effect was unmistakable.

For instance, on Sunday, Loblaw CEO Per Bank took to LinkedIn to announce that the retailer would be “taking action to minimize the impacts” of the trade war during an already difficult period. He listed steps that the national grocery chain would take, which included increasing its efforts in securing food grown and made in Canada; as well as looking for alternative products outside of the U.S., with a particular focus on importing more goods from Mexico, “which has also been subjected to these unnecessary tariffs.”

“What the CEO of Loblaws did leveraging Canadian nationalism is exactly what brands will do,” says Pujolàs of how local brand marketers can turn the impact of a trade war on consumer sentiment into an opportunity. “Companies should use this moment to appeal to patriotic sentiment, not by advocating for tariffs, but by positioning themselves as Canadian alternatives to foreign brands.”

Meanwhile, the CEO of Shopify, Tobi Lütke, said his company (while unaffected by the tariffs) would roll out “buy local features” on its Shop app. In a post on X, he stated that his company would introduce the tool in Canada, the U.S. and Mexico to start, with the intention to launch this week. Shopify’s response is reported to have come as a result of calls on social media asking for his company to introduce this type of feature, according to BetaKit.

While the trade war appears to be on hiatus, and we’re unable to say for definite if Canada’s muscular response to Trump’s tariffs was the straw that broke the camel’s back, Dr. Cleveland says there is a chance the recent movement could revive consumer consciousness when it comes to spending money on Canadian soil.

While some consumers may eventually return to their old shopping habits, others could shift permanently, says Dr. Cleveland, pointing to Heinz Ketchup as an example. “When Heinz closed its Canadian plant [in 2014], there was a backlash. I had never bought another brand of ketchup in my life, but after that, I switched to French’s, which prominently advertised its Canadian-made status. That shift became permanent for me – and I suspect that will happen for many consumers in other product categories,” he said.

Dr. Cleveland says brands could still implement strategies that lean into their Canadian identity. For instance, Peter Mammas, CEO of Foodtastic – which operates majority Canadian-owned restaurants such as Second Cup, Milestones, Pita Pit, Freshii and Quesada – told strategy yesterday that his team was working on a new campaign that would highlight several of its 27 brands and urge Canadians to buy local. “We saw similar strategies from Japanese car manufacturers when they faced U.S. tariffs in the past. I expect Canadian brands to lean into their national identity, incorporating more Maple Leaf imagery into packaging,” says Dr. Cleveland.

While consumer boycotts and nationalist branding efforts may fluctuate, the professor believes the current trade war has already created a deep mark on Canada-U.S. relations. “I’ve never seen Canadians this angry at the U.S., and I don’t think that sentiment will fade quickly,” Dr. Cleveland says. “President Trump’s unpopularity in Canada could be a lasting factor. His rhetoric – such as calling Prime Minister Trudeau ‘Governor Trudeau’ and referring to Canada as ‘the 51st state’ – has intensified resentment.”

While tariffs may be paused (for now), another deeper question also remains: Will Canada use this as a catalyst to fix its own trade inefficiencies? Much of the focus has been on the U.S.’s protectionist stance, however Pujolàs argues that Canada should use this moment to address its own trade inefficiencies.

“Right now, it’s expensive for an Ontario business to buy from British Columbia or for a company in Nova Scotia to purchase from Alberta. That makes no sense. The federal government should take this opportunity to unify Canada as a true single market. By my calculations – and those of my colleagues – reducing interprovincial trade barriers could boost GDP by 4% to 7%, whereas the economic damage from Trump’s tariffs is estimated to reduce GDP by 1% to 2%.”

For Pujolàs, the answer lies in Canada’s ability to take the long view. “Trump isn’t just targeting Canada – he’s also taking an aggressive stance toward the European Union. This is the perfect moment for Canada to strengthen its trade ties with Europe. We should revisit the Canada-EU Free Trade Agreement and remove any remaining trade barriers. The same logic applies to other markets, such as the United Kingdom. With the U.S. becoming more protectionist, this is an ideal time for Canada to expand its trade relationships with stable, rule-of-law-abiding countries. If we do this, the benefits will far outweigh the harm caused by Trump’s tariffs.”