Market volatility is nothing new, yet this one is different. It is caused by tariff uncertainty, where sweeping decisions send ripples across global markets, reshaping decades-old international commerce. Relying on quarterly earnings calls, SEC filings, and traditional economic indicators to navigate this storm simply won't cut it. But alternative data just might.

Traditional data: too little, too late

Intel has announced that it will soon be slashing even more jobs. Sketchers withdrew its annual guidance, citing "macroeconomic uncertainty stemming from global trade policies". Hyundai is relocating to Alabama to avoid auto tariffs. Meanwhile, P&G is sounding the alarm about price increases, as it takes a $1.5 billion tariff hit. All of this happened within days of the US tariffs announcement on April 2nd, which had sent the S&P 500 plunging 10% in just 48 hours.

"The current environment is simply too dynamic from which to plan results with a reasonable assurance of success", lamented Skechers' COO David Weinberg after withdrawing the company's annual forecast. He's not the only one feeling this way.

It's painfully obvious what the problem is. By the time a company files its quarterly report detailing tariff impacts, the market has already adjusted to that information, along with three new rounds of policy changes that have occurred since then. When Intel's CFO warns about “very fluid trade policies,” he acknowledges that the usual forecasting models are nearly useless in this case.

The announcement on April 9th about a 90-day halt on most new reciprocal tariffs (except for China) sent another series of ripples in the market, returning some of the stock value. After a while, in yet another twist, the US and China made a deal to also put most tariffs on a 90-day pause. Still, the full effects on corporations won't be apparent in the usual financial reports for months. By then, we'll be approaching the first and second deadlines when the pauses expire, potentially unleashing another wave of volatility.

For now, companies are stepping back from providing guidance, essentially flying without a compass; investors are having a hard time gauging risk accurately; and supply chains are being reconfigured at enormous expense, sometimes for no good reason. Meanwhile, strategic planning has turned into a game of putting out fires instead of proactive management. In this environment, conventional data isn't just lacking – it can be dangerously off the mark.

A tariff-turbulence radar

While traditional analysts are still sifting through last quarter's figures, the more forward-thinking decision makers are mining alternative data sources that reveal what's happening right now – and what's likely to happen next. Think of alternative data as your high-resolution radar for navigating the tariff storm.

Detecting shifts before they're official

Satellite imagery companies can literally watch as Chinese factory activities slow down in response to tariff changes. Meanwhile, S&P Global Intelligence recently published a report detailing several new tools for dealing with the tariffs, one of which includes headcount data sourced from online job profiles. These are just some ways alternative data can help businesses predict how the introduction of tariffs is likely to play out.

Some businesses use anonymous credit card transaction statistics to understand real-time consumer behaviour. As companies like Procter & Gamble consider adjusting their pricing strategies, alternative data can help them see if, in such cases, customers tend to stick with their favourite brand or leave for greener pastures.

Moreover, web scraping tools allow for constant monitoring of e-commerce pricing changes across thousands of products affected by tariffs. This ability to track prices can uncover how retailers are strategically responding to policy changes.

Following the money (when it matters)

An effective way of tackling tariff uncertainty is to keep an eye on shipping and logistics data. This information is crucial because it gives us real-time insights into how the supply chain is adjusting. For instance, by looking at shifts in container bookings, changes in shipping routes, and port activities after tariff announcements, investors can pinpoint which companies are quick to adapt their supply networks – and which ones aren't. Knowing this can give businesses a significant edge over their competitors.

Another method involves examining job postings, as these can reveal strategic changes in corporate structure that aren't always publicly stated. Observing changes in hiring trends across regions with varying trade relationships makes it easier to figure out which companies are adjusting their manufacturing and distribution strategies in light of changing tariff policies.

Large-scale news and customer sentiment analysis can also help assess market reactions to trade developments in real time. Tracking everything from major announcements to low-profile meetings and consumer reactions helps capture shifting market sentiment hours before conventional analysis becomes available.

From reactive to proactive

Having access to alternative data is one thing. Turning it into a competitive advantage is another. A few examples of savvy business practices help get the idea.

For investors, there's a significant alpha opportunity out there. Given how hectic things become whenever news of fresh tariffs hits the airwaves, quantitative funds that tap into alternative data can pinpoint companies with robust supply chains. This allows them to make more focused investment choices, while traditional portfolios might be bogged down by outdated information.

For corporate executives, alternative data provides a means to respond with precision rather than fear. Rather than implementing sweeping policy changes, they're utilising granular insights to make surgical adjustments:

• Raising prices selectively on products where competitors are also increasing theirs
• Moving production only for supply chains that are genuinely at risk
• Fine-tuning inventory levels with impressive accuracy
• Hedging against currency and commodity fluctuations based on real-time shifts in trade flow

For supply chain managers, alternative data has transformed from luxury to lifeline. When tariffs change overnight, these managers feel the heat immediately and start bending over backwards to reroute shipments, renegotiate with suppliers, and recalculate landed costs. However, those who've been quick to harness alternative data can act in an organised manner. Tracking vessel movements, monitoring factory activities, and analysing customs clearance times in real-time helps them quickly pivot their global networks, while others are stuck waiting for official reports.

The uncomfortable truth about tariff navigation

We must face the fact that the world is moving faster than ever. And this is no longer just about the pace of innovation or production. It is also about policy changes and market reactions to them. Data has to be more dynamic and come faster to keep up with this new pace.

The shift to alternative data isn't just about sophisticated hedge funds anymore. Businesses are subscribing to satellite imagery services. Web scraping is booming. Investors and tech companies are increasingly turning to alternative data. Its democratisation will likely accelerate even faster because tariff uncertainty makes it essential rather than optional.

Challenges remain. Alternative data requires new skills, different infrastructure, and a willingness to change long-lasting procedures. It can be a risk. However, another lies in clinging to quarterly reports and annual forecasts while the trade landscape transforms weekly. In today's markets, where tariff policies can reverse direction suddenly and supply chains must adapt just as quickly, relying solely on backward-looking traditional data isn't merely suboptimal – it's dangerous.

Traditional data helps you understand what happened. Alternative data helps you navigate what's happening right now. As things stand, it's the present, not the past, where both danger and opportunity reside.

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