Arrrrr! 🏴☠️ Welcome to a 🔒 subscriber-only edition 🔒 of Category Pirates. Each week, we share radically different ideas to help you design new and different categories. For more: Dive into an audiobook | Listen to a category design jam session | Enroll in the free Strategy Sprint email course
Dear Friend, Subscriber, and Category Pirate,
We’re a few months into 2025, and consumers are stashing their treasure—and rethinking every purchase.
Not because of inflation. Not because of interest rates.
But because the government is tightening the purse strings.
Pirate Eddie recently shared his POV on consumer sentiment with the Schwab Network. He explains why government spending is being investigated, audited, and dialed back. Why job losses are hitting government-reliant industries hard. And why consumers are spooked—not by headlines, but by direct exposure to the fallout.
If you’re a Category Designer, you need to understand what this means because the future isn’t being shaped by spending patterns.
It’s being shaped by spending retractions.
In this Jam Session, we break down why consumer sentiment is dropping, how spending patterns are shifting, and what this means for your category strategy.
Here’s what we unpack:
Why the University of Michigan’s Consumer Sentiment Index just dropped for the third straight month
What it means when spending slows and savings spike—at the exact same time
And why companies who mistake this for a temporary pullback will get blindsided by what’s coming next
This isn’t just about what people are buying. It’s about what they believe is safe, smart, and socially acceptable to buy. Because when the government pulls back, consumers follow.
Here’s how to navigate the conversation:
00:37 – Consumer Sentiment Slump: Why confidence is down three months straight
05:20 – Personal Income vs. Spending: Why this is a rare moment where both zig in opposite directions
11:44 – The DOGE Effect: Why anti-government waste sentiment is gaining traction—and affecting business
20:12 – Government Dependency as a Business Risk: Why and entire industries (and companies like Booz Allen) are more exposed than they realize
26:15 – The Bigger Picture: What happens when the era of unchecked government cash ends
We hope this gives you a lens into how consumers feel right now, so you know how your category might be impacted.
Arrrrrr,
Category Pirates 🏴☠️
P.S. - Where are you seeing changes?
We’re curious—drop a note in the comments and tell us what weird, early signals are popping up in your category. 🎸🏴☠️
