Online shopping slows as tariffs bite, delivery costs rise: Survey

Online retail is facing its most significant upheaval in over a decade, driven by mounting tariff pressures, shifting consumer expectations, and rising delivery costs, according to AlixPartners' latest Home Delivery Survey. The report underscores how trade policy and inflationary headwinds are reshaping the dynamics between consumers, retailers, and delivery providers.

Conducted in late May and early June, the survey of 1,100 US consumers and executives across retail and logistics reveals a stark slowdown in online delivery growth across most sectors—marking the first such stagnation since the survey began in 2012.

“Elevated consumer awareness of tariffs is clearly flowing through into buying decisions,” said Chris Considine, a partner in AlixPartners’ retail practice. “You can see how people are timing their purchases and the conscious effort among a sizeable minority to ‘Buy American’.”

Tariffs are prompting 37 per cent of consumers to reconsider what and when they buy, with 66 per cent indicating they would prefer US-made products if import costs rise. About 34 per cent have delayed purchases due to price volatility, while 28 per cent have rushed to buy in anticipation of tariff hikes.

Meanwhile, online home delivery volumes have fallen across core e-commerce sectors, registering double-digit year-on-year declines. Despite weaker demand, consumer expectations remain high: 3.5 days is still considered the ‘sweet spot’ for delivery, and free shipping continues to be the dominant factor behind purchase decisions.

Retailers, in response, are cutting back on once-standard perks. Many are now restricting access to free delivery—either raising minimum spend thresholds or requiring paid memberships—and reducing return flexibility. Almost half of retailers surveyed said they’ve tightened their policies or shifted focus towards in-store pick-up and returns, the report said.

A demographic shift may offer some breathing room for struggling shippers. Gen Z consumers are more tolerant of slower deliveries, often waiting a week or more and allowing time for consolidated shipments. They also favour global value platforms like Shein and Temu, despite recent changes to low-value import duty exemptions.

With nearly three-quarters of retail and logistics executives reporting increased per-package delivery costs, cutting last-mile expenses has become a priority. In response, companies are pulling away from major carriers: 40 per cent have reduced volume with FedEx and UPS, and half report diversifying their logistics partners.

“Carriers are feeling the pinch as shoppers reconsider and shippers diversify to lower costs,” said Marc Iampieri, global co-lead of AlixPartners’ logistics and transportation practice. “Optimising your distribution network is the big lever for retailers, and they are pulling it hard, adding more pressure on the carriers.”

Amid growing trade friction, economic caution, and evolving consumer behaviour, the future of e-commerce delivery may hinge less on speed—and more on strategy, flexibility, and value.