The True North Strong and Fierce: Canadian Agencies Unyielding in the Face of Tariff Talk

Since inauguration day, President Trump has moved quickly to communicate his agenda, including talk of tariffs of up to 25% on imported goods from Canada. And while it will likely remain just talk for at least the next few weeks, it has become the overwhelming narrative in our country, unleashing a wave of patriotism, underscored, of course, by fear.  

This fear has percolated through our industry too, with the old adage ‘where the economy goes, so too does advertising’. But perhaps that is all simply rhetoric. Despite this economic uncertainty, and all the noise accompanying it, history has proven that, in fact, the Canadian marketing industry is highly resilient. Among the most resilient of industries over the two decades that included the Great Recession followed by periods of instability, the pandemic and high inflation all negatively impacting consumer behaviour. I write this as someone who launched not one, but two agencies during Covid-19.

In 2023, the Canadian industry's operating revenue increased by 7.8% to $14.4 billion, and there are now more than 8,600 businesses involved in a sector that grew at an average annual rate of 4% between 2020 and 2025.

There can be no question that the sector’s contribution extends across the Canadian economy. Valuable work from Canada's agencies generates more than $6 CAD return in GDP for each dollar spent on advertising. That return will look even more attractive should today’s uncertainty end with tariffs tomorrow. 

For our clients, brands both domestic and international, the path through unpredictability has been proven time and again to be one that doesn’t just encourage investment in marketing, but, in fact, compels it. All the evidence bears this out. The results of 2022 research from the Effie Awards Canada demonstrated that brands that committed budget to brand building, compared to those focused on short-term sales, showed a 27% uplift in long-term business effects.

A report published by Harvard Business School after the global recession of 2007 stated, "companies that master the delicate balance between cutting costs to survive today and investing to grow tomorrow do well after a recession." The report detailed how businesses that combine "defensive and offensive moves" have the highest probability - 37% - of leading their rivals. It said: "These companies reduce costs selectively by focusing more on operational efficiency than their rivals do, even as they invest relatively comprehensively in the future by spending on marketing, R&D, and new assets. Their multipronged strategy is the best antidote to a recession.”

More recently, Kantar's research revealed that the stock prices of companies with the strongest brands have consistently outperformed the market average since 2006 - making the case for long-term brand investment even more convincing. "Top brands withstand market volatility better than counterparts with less brand equity, thus safeguarding business interests during turbulent times. This greater resilience and faster recovery were particularly notable following the global financial crisis and again over the COVID-19 pandemic," the report stated. 

So, as both the volume and the prospect of economic volatility rise in the face of US tariffs, it’s crucial for agencies and our clients to shut out the noise and reflect on past experience as we consider the way forward. In moments of uncertainty, the Canadian advertising industry and the best brands prevail by rising to the occasion - navigating current market instability whilst keeping one eye on the future. If we can maintain the confidence to do that in this unique moment, surely we will have nothing to fear but fear itself.