Record-Braking Holiday Season in US, Declining online sales in Germany, and more | D2C Digest

Hey there, great people of the D2C community who are building fantastic things! This is your host Berkay writing. 

Take a 5 mins break and dive into D2C Digest for a quick overview of what’s happening in the D2C market worldwide!

📈 Record-Braking Online Holiday Season

The Adobe 2023 Holiday Shopping Report reveals some impressive statistics and trends. Here's a snapshot of the key findings:

1. Record-Breaking Online Spending: The 2023 holiday season in the US saw online spending soar to a new high of $222.1 billion, marking a 4.9% increase from the previous year. This growth sets a new record for e-commerce sales.

2. Consumer Behavior Shifts: Shoppers were particularly price-sensitive, with many flocking to online stores to find the best deals available. This trend was likely influenced by economic factors and a growing consumer preference for online shopping convenience.

3. Impact of Major Sales Events: The period known as Cyber Week, which includes Thanksgiving, Black Friday, and Cyber Monday, was a significant driver of this spending surge. Cyber Week alone accounted for $37.2 billion in online spending, up 5.4% year-over-year. Notably, Cyber Monday continued to be the biggest shopping day of the season, pulling in a record $12 billion in spending, an increase of 6.1% from the previous year.

4. Popular Payment Methods: A notable trend in payment methods was the increased use of flexible options like 'Buy Now, Pay Later'. This reflects a shift in consumer preferences towards more adaptable payment solutions.

How was your holiday season?

🤔 A Different Picture In Germany: Declining Online Sales

Is your D2C brand based in Germany? The news might be a bit worrying for you.

A recent survey highlighted a noticeable shift in consumer behavior in Germany, with more people moving away from online shopping and returning to physical stores. This change suggests that the online shopping boom, initially fueled by the coronavirus pandemic, might have reached its peak in the country.

Decline in Online Sales of Goods: In the first quarter of 2023, online sales of goods in Germany fell by 15% compared to the same quarter in 2022. This decline was particularly evident in the fashion sector.

However, it's interesting to note that while sales of physical goods declined, sales of digital services, like holiday bookings, actually saw an increase of over 28%. The food segment, on the other hand, remained stable​​.

With inflation in Germany remaining high at around 7.2% in April 2023, consumer behavior has been significantly influenced. To cope with rising prices, most online shoppers in Germany have been preferring to buy cheaper products.

So an omnichannel approach seems like a fitting strategy to cope with this!

😬 X Is Not Advertisers’s Favorite Anymore, LinkedIn Takes Advantage

The recent news around Elon Musk's X and its impact on LinkedIn's advertising revenue makes for an intriguing business case.

X, under Elon Musk's leadership, has seen a notable decrease in advertising sales in 2023. The platform is estimated to generate around $2.5 billion in advertising revenue for the year, which represents a considerable slump from previous years​​.

Since Musk took over X, the platform's monthly U.S. advertising revenue has consistently fallen by at least 55%. This decline contrasts with earlier optimistic statements about advertisers returning to the platform​.

As X experiences this downturn in ad revenue, LinkedIn, a professional networking platform, is capitalizing on the situation. Advertisers leaving X appear to be redirecting their budgets to LinkedIn, thus boosting its advertising revenue. This trend indicates a shift in advertiser preferences and spending strategies, possibly driven by the changing social media landscape and corporate reputations.

Are you advertising on LinkedIn?