E-commerce Declines in 2024
October 23, 2024
by a searcher from Marist College in Austin, TX, USA
E-commerce peeps:
I'm near closing on a Shopify business but don't like what I've been seeing in company performance over the past three months. I'm trying to figure out if it's just the lack of available paid media due to the US election cycle or something more systemic in the business.
What are you seeing in 2024 in terms of the declining performance of paid media?
from University of Idaho in Boise, ID, USA
I've attributed it mainly to the roll out AI models into a lot of the algorithms of ad platforms. Google, for example, pushed a lot of new AI into their ad platform at the beginning of 2024, and some campaigns went completely bonkers. In one case, we scrapped campaigns that had been performing well for years, but were creeping up in cost, and rebuilt them from scratch with the newer tools, and they improved a lot.
That was my experience with Google at least. I'm sure other platforms have been 'improving' their ad platforms with AI too. The improvements may come from AI, for sure, but I would consider creating brand new campaigns with similar settings and seeing which ones perform better.
All that said, it could be the election cycle driving demand (and bids) higher as well, especially if it's specifically over the last 3 months, and your ads focus heavily on display advertising.
Hope this helps!
from Vlerick Business School in Zürich, Switzerland
I'll be the idiot here - what is an eCommerce business (?) - I suppose there's a spectrum
For example:
- B2C niche (higher-value) electronics business selling products under own brand (no manufacturing)
- strong website, leading player in their niche with strong content incl complemented by social meeting - source 0f majority of sales
- additional distribution via (local European) Amazon-like platforms as well as other B2B2C platforms (very limited brick & morter distribution)
---> how exposed do you see such a model to the above-mentioned trends?
Europe (and particularly Switzerland where we don't even (yet at least) have Amazon) is probably more nuanced than the US....
Is there objective, high-level data out there somewhere on how bang for your buck on Google ad spend is evolving? (I know this is a very broad question!)