The U.S. government’s decision to impose reciprocal tariffs on over 180 countries represents a seismic shift in global trade dynamics. While the full impact remains uncertain during the current pause period, one thing is clear, businesses must proactively reassess their supply chains and customer-facing operations to build resilience in the face of mounting uncertainty.
While the direct implications for goods, those explicitly targeted by the tariffs, are well documented, the downstream effects on the services sector are equally inevitable. The Customer Experience Management (CXM) industry, deeply intertwined with global delivery networks, talent ecosystems, and consumer behavior trends, is poised to feel the pressure.
Rising inflation, fluctuating customer demand, and increased cost scrutiny are also prompting Customer Experience (CX) leaders to reevaluate how and where they invest.
In this blog we will explore the potential short- and long-term ramifications of these tariff developments on CXM operations and what CX leaders should expect in a rapidly evolving economic landscape.
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The macro context of the impact on a shifting trade environment
At first glance, CXM would seem to be shielded from the first-order effects of trade policy. However, CXM is deeply integrated with physical product ecosystems through services such as automotive support, retail support, and post-sales device support. The shocks to global supply chains and consumer behavior from this will directly impact the interaction volume, complexity, and cost of CX services delivery.
The most immediate implications for CX leaders are:
- Rising Total Cost of Ownership (TCO): tariff-induced inflation will potentially drive-up input costs for talent and infrastructure expenses, and CX leaders must prepare for demand volatility which will increase their CX support costs, especially for high-touch operations
- Pressure to re-optimize shoring decisions: with rising inflation and tariff-driven cost escalation, CXM operations in high-cost delivery centers will become increasingly unsustainable. Even organizations which were traditionally hesitant to offshore or nearshore are now compelled to reassess location strategies, opening to lower-cost geographies like Latin America, Southeast Asia, and Africa, driven by cost resilience and access to multilingual talent
- Reprioritization of CX investments: with tighter budgets, CX leaders face the pressure to balance long-term CXM transformation initiatives (e.g., platform deployments, Artificial Intelligence (AI) solutions, etc.) in favor of immediate cost-containment efforts. In shorter term, they will need to prioritize quick wins, Return on Investment (ROI)-driven solutions, and flexibility in delivery
Potential implications for CXM due to disruptions across industries
While the new U.S. tariffs directly target physical goods, the downstream effects could be felt on CXM operations across industries, especially those with high customer interaction volumes or complex global operations. Here’s how different industries are expected to be impacted:
| Industry | Risk Factors | Short-Term CXM Implications | Long-Term CXM Implications |
| Telecom & Media | – Potential tariffs on imported electronics and network equipment – Delayed 5G/6G and fiber infrastructure rollouts – Device cost inflation affecting upgrades and new launches | – Spike in inquiries about device longevity, service quality, and more support – Escalation in complaints tied to outages or postponed upgrades – Need for proactive outreach for cost/availability related situations impacting customer experience | – Need for investments in digital self-service tools (e.g., messaging, IVR deflection) to cope up with high interaction volumes – Expansion of omnichannel support for billing and technical queries – AI-led diagnostics and device support |
| Technology | – Dependency on global semiconductor and hardware components supply chain – Rising costs of imported IT assets – High input costs resulting in budget cuts delaying innovation cycles | – Increase in technical support volume – Higher demand for product availability and warranty support – Pressure to optimize support costs using automation | – Offshoring or nearshoring of tech support to reduce costs – Adoption of predictive analytics for issue resolution – Greater integration between CXM and product engineering teams |
| BFSI | – Increased inflation and interest rate volatility – Declining consumer credit health – Increased risk of fraud and default – Declining financial transaction volumes | – Influx of inbound calls around loan repayment, interest rate changes, and budgeting – Need for empathetic collections and customer retention strategies – Need to efficiently manage any surge in fraud-related queries and claims | – Requirement to embed financial wellness tools and financial advice services – More advanced fraud detection in customer interaction workflows – Expanded use of AI agents for low-complexity financial support |
| Retail & e-commerce | – Supply chain concentration in tariff-affected countries – Potential product shortages especially for imported products – Margin pressure due to muted demand from consumers especially on luxury products | – Elevated inquiry volume for deliveries, pricing, and returns along with well-defined escalation workflows – Real-time updates required for stock availability and shipping times – Staffing flexibility for peak-volume handling – Well trained agents equipped to handle questions about supply chain disruptions | – Deep personalization across CX touchpoints for price-sensitive shoppers – Integrated inventory and support platforms for real-time updates – Shift toward AI-enabled chat and messaging support |
| Travel & Hospitality | – Economic uncertainty reducing corporate travel and events as businesses monitor costs closely – Cost-driven cancellations and rescheduling – Declining demand from international travelers due to higher costs and/or nationalistic sentiments | – Increased service demand related to cancellations and travel insurance claims – Spikes in reward program redemptions – High interaction volumes in contact center during peak booking windows | – Deployment of virtual travel assistants and itinerary bots – Flexible staffing models to scale quickly in case of any sudden tariff announcements – Integrated support across channels (chat, app, voice) with scalable digital concierge services |
| Manufacturing | – Impact of heavy reliance on imported raw materials and parts especially for auto manufacturers – Tariffs on cross-border manufacturing inputs (e.g., Mexico, Canada) – Production delays, cancellations, and inventory shortfalls | – Surge in escalations due to delayed shipments or canceled orders requiring well defined escalation workflows – High-touch and proactive communication needed for enterprise buyers and distributors – Requirement to manage B2B and B2C interaction channels in tandem | – Integration of supply chain data with CXM operations leading to real-time production visibility during customer interactions – Predictive service models based on supply chain insights – Better agent training to enable empathetic conversations to reduce both B2B and B2C customer frustration |
| Energy & Utilities | – Infrastructure investments affected by import costs – Regulatory pressure to contain customer energy costs – Potential geopolitical supply shocks | – Rising number of billing complaints due to potential rate hikes – Greater volume of outage reporting and service quality concerns – Backlogs in support channels without intelligent triage | – Predictive analytics for outage alerts and rate forecasts – Self-service billing portals with clear cost breakdowns – AI-driven routing to prioritize high-risk or vulnerable customers |
| Healthcare & Life Sciences | – Medical device and pharma import disruptions – Rising costs in patient care and diagnostic – Increased pressure on healthcare providers’ operational margins | – Growth in inquiries about insurance coverage, delays in procedures, and claim processing – Compliance risk with regulatory requirements for patient engagement – Longer wait times impacting satisfaction | – Expansion of secure and compliant omnichannel systems – Use of AI to triage patient cases and billing inquiries – Personalized healthcare engagement for chronic care support |
What should be the strategic response from CX leaders?
CXM is no longer just a service delivery decision, it’s a strategic lever for competitive differentiation. To navigate the turbulence, CX leaders should consider activating the following strategic levers:
- Rebalance global delivery models: evaluate current delivery footprints. Tariff-driven cost challenges present an opportunity to diversify into resilient, cost-effective locations across Asia, Latam, and Africa. Consider investing in real-time language translation and accent localization technologies which can help maintain the same quality of interactions from different countries
- Adopt smart workforce management strategies: along with traditional workforce models, lean into gig models, flexible staffing, and AI-based forecasting to manage volume spikes with agility
- Prioritize ROI from digital solutions: focus investment on initiatives that drive measurable savings or retention such as self-service deflection, agent assist tools, and AI agents. Large-scale platform overhauls may be deferred unless tied to near-term value
- Scenario planning & risk management: introduce trade-policy-related risk assessments into planning. Collaborate with your CXM service providers to run ‘what-if’ simulations based on potential tariff scenarios, delivery cost swings, or consumer downturns and pre-build mitigation playbooks accordingly
- Forge partnerships with experts: Develop close partnerships with industry associations, third-party service providers, and policy experts to monitor trade policy developments and their immediate implications to anticipate and adapt strategies quickly
What should CX leaders do in the months ahead?
The tariff landscape remains fluid, and the long-term impact will depend on how they are implemented eventually. As negotiations and retaliation continue, CX leaders must not view this as a one-time event, but as a structural shift in global operating conditions.
While the U.S. tariff regime is primarily aimed at reshoring manufacturing and correcting trade imbalances, its implications for the services sector, especially in CXM, can be profound. Much like the pandemic, it now requires a rethink of how customer experience is delivered, sourced, and optimized. CX leaders should act now to build more agile, tech-driven, and geographically diversified delivery models. The winners in this next phase won’t just respond to trade dynamics but instead, they’ll use them as a catalyst for future-proof customer experience.
For more information regarding the US administrations tariffs and to see what the US tariffs mean for the global services market, please visit https://www.everestgrp.com/us-administrations-tariffs/
If you found this blog interesting, check out our How Will The New Tariffs Affect The Global Services Market? | Blog – Everest Group, which delves deeper into the global services industry regarding the latest tariffs and how this may affect various sectors in the US and beyond.
If you have any questions or want to discuss the impact of tariffs on the CXM industry in detail, please contact Chhandak Biswas ([email protected]).
