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We Predicted the Future #61

We Predicted the Future #61

We got 75% of our 2024 predictions right. Did you?

Tye DeGrange
December 19, 2024

In partnership with

2024 Predictions Review Issue

Let’s see how we did in 2024.

Oh, the old days of Jan 2024

PREDICTION: 📈 Inflation will continue to be reined in, and the Fed will lower interest rates twice in 2024 to land at a Federal Funds rate of 4%, down from 5.5%.
1. ANSWER
  1. The Federal Reserve has lowered interest rates three times so far in 2024. I was close. The third cut came today, Dec 18.
  2. The federal funds rate is now 4.50% higher than my estimate.
  3. The prediction was close, but no cigar. 🟧
PREDICTION: 🏢 Commercial Real Estate (Office) will continue to struggle, particularly in key regions and cities.
1. The national office vacancy rate reached 19.2% in Q3 2023, approaching a historical peak of 19.3% Source.
2. Office vacancy hits 25% in 2024
3. ANSWER: The office vacancy rate reached approximately 19.4% by the end of October 2024, marking a significant increase from previous years due to remote work and high interest rates. Office vacancy rates were even higher in specific markets like San Francisco and Austin, reaching 27.7%. This is directionally accurate but not as high as I had predicted. 🟧
🛍️ DTC Ecomm Brands to grow again 🟩
1. PREDICTION: In 2023, global e-commerce revenue was approximately $5.62 trillion, reflecting a growth of 9.7% from the previous year.
2. ANSWER: For 2024, projections indicate that global e-commerce revenue will reach between $6.09 trillion and $6.33 trillion, marking an increase of about 8.4% to 8.5% from 2023. I NAILED my sandbag prediction 🙂 🟩
PREDICTION 🛒 Shopify SHOP stock price. Shopify performed exceptionally well in 2023, with its stock pricing increasing 119% in 2023. The stock is currently at $76.83; I estimate it will reach $125 in 2024.”
1. 🟧 - close again and directionally accurate, but no cigar! Up >50% this year and $114 at the article writing.
PREDICTION 🇺🇸 US Economy will perform reasonably well as the Fed tries to pull off a “soft landing” 🛬 post-COVID, stimulus, inflation, and interest rate increases, with GDP at $27.16 trillion. However, discretionary spending will continue declining as consumers increase their credit card spending and the cost of essentials remains high. GDP growth will be slightly less than the estimated (1% v 1.5%), and unemployment will be somewhat less than estimated (4.1% v 4.4%).
1. ANSWER
  1. The Fed was able to navigate a soft landing for the most part - so far
  2. Credit Card and Auto Loan Debt and defaults surged
  3. GDP is estimated at $27.7 trillion versus my estimate of $27.16 trillion. DAMN CLOSE! 🟧
  4. GDP growth is projected to hit 2.7%, much higher than the 1.5% 🟥
  5. Unemployment estimate was 4.1%, and in reality, it was…4.1%! 🟩
PREDICTION 💼 Hiring will continue to improve in Tech and EComm slowly. Unemployment will decrease by about 10% in the sector in 2024. Modest improvements will be won as companies aim for efficiency over scale.”
1. ANSWER: The tech sector did see some improvements in hiring, with a focus on specialized roles such as cybersecurity, AI, and cloud computing. However, the overall tech job market remained relatively stable, with modest fluctuations in unemployment rates. The tech unemployment rate decreased slightly to 2.5% by December 2024, indicating a competitive job market but not a significant decrease in unemployment by 10% as predicted. I was too optimistic. 🟥
2. The demand for tech talent continued to grow, driven by digital transformation and emerging technologies, but this did not translate into a dramatic decrease in unemployment. Directionally true 🟧
3. It is directionally accurate again but more challenging to quantify, especially in the DTC space. 🟧
PREDICTION🤖 AI adoption will only continue as consumer brands and tech companies invest in testing to improve learning and operational efficiency. ChatGPT and Bard alone will report multiple billion users in 2024.”
1. ANSWER🟩: Nailed it. Google AI changed its name to Gemini. ChatGPT had approximately 180.5 million users by March 2024, and by December, it attracted 1.6 billion visits in a single month. Google Gemini had around 42 million active users as of October 2024, with an average of 142.6 million visits per month throughout the year.
🏈 NFL: My beloved San Francisco 49ers 🥇 will win the Super Bowl.
1. Sad story - “Close only counts in horseshoes and hand grenades.” Dre Greenlaw doesn’t get hurt, and we win - lost by one play. And let’s not even talk about this season. ☹️ 🟧
NCAA: 🏈 The Michigan Wolverines will win the National Championship. A win! 🟩
🤳 Meta - costs will continue to go up. But performance will justify it. Those that know how to tame the algorithm will crush. Those who resist it will be crushed. 🟩 True!
1. Average CPM: The average price per ad increased by 11% in the third quarter of 2024, reflecting higher costs for advertisers due to improved ad effectiveness and demand
2. Revenue Growth: Meta's advertising revenue saw significant growth throughout 2024. In the second quarter, ad revenue was $38.3 billion, marking a 22% year-over-year increase.
3. By the third quarter, total revenue reached $40.59 billion, a 19% increase from the previous year.
4. Ad Impressions: There was a 7% increase in ad impressions in the third quarter of 2024, indicating a higher volume of ads being served across Meta's platforms
Google 🟩
1. PREDICTION: $155 price target - nailed it 🟩
2. PREDICTION: Costs will go up 🙂
  1. Costs rose modestly 🟩
    1. CPM: The average CPM was $230 in Q1 2024, lower than the $373 average in 2023, but costs increased seasonally throughout the year. This suggests a normalization after the sharp rise in 2023.
    2. CPC: The average CPC for Google Search Ads increased to $6.60 in 2024, up from $6.20 earlier in the year, representing a modest rise.
    3. Google Ad Revenue Growth: Advertising revenue grew significantly, with Google Search and Other Advertising generating $49.4 billion in Q3 2024, a 12% year-over-year increase. YouTube ads also grew by 12%, contributing $8.9 billion for the same quarter.
TikTok 🟩
1. PREDICTION: MAUs will go up significantly
2. ANSWER: The platform surpassed 1.8 billion MAUs by the end of the year, up from approximately 1.5 billion in 2023. This represents an increase of about 20% in monthly active users over the year.
Snap 🟩
1. PREDICTION: They continue to beat earnings
2. ANSWER: They did! 🟩
3. In 2024, Snap beat earnings expectations in multiple quarters, showing strong financial performance:
  - Q1 2024: Revenue grew 21% year-over-year to $1.19 billion, exceeding expectations. Adjusted EBITDA was $46 million, up significantly from $1 million a year earlier.
  - Q2 2024: Revenue increased 16% year-over-year to $1.23 billion, with Adjusted EBITDA improving by 243% to $55 million.
  - Q3 2024: Revenue rose 15% year-over-year to $1.37 billion, slightly beating analyst estimates of $1.36 billion. Adjusted EBITDA surged 229% to $132 million, and earnings per share (EPS) of $0.08 exceeded expectations of $0.05.
Reddit 🟩
1. PREDICTION: Will put some wins on the board and IPO 🟩 NAILED IT
2. ANSWER:
  1. IPO: Reddit successfully went public on March 21, 2024!
  2. Financial Performance: By the third quarter of 2024, Reddit reported its first-ever profit as a public company, with a net income of $30 million. This was a significant turnaround from previous losses.
    1. 68% increase year-over-year
    2. Key drivers: strong advertising revenue growth and partnerships for AI licensing.
  3. Struck a golden deal with Google: This impacted our performance and even the affiliate marketing space.
    1. The deal, valued at $60 million annually, allows Google to train its Vertex AI on Reddit's data.
    2. Super detailed article here —> "The Google-Reddit AI Deal: Strategic Move or a Harbinger of Licensing Agreements to Come."
      1. The article outlines the strategic benefits for both companies:
        Google's need for more training data for its AI models and
        Reddit's financial boost ahead of its IPO.
      2. The article also explores the broader implications of such licensing agreements in the context of AI development and intellectual property concerns.
  4. If you want to use Affiliate Marketing to reach Reddit users and only pay when someone converts / purchases, hit me up 😉
Influencers 🟩
1. PREDICTION: Influencer marketing will outpace all growth in all digital platforms" was largely accurate based on 2024 data: ACCURATE 🟩
  1. ANSWER: Influencer Marketing Growth:
    - The influencer marketing industry grew to an estimated $24 billion by the end of 2024, reflecting a strong compound annual growth rate (CAGR) and a 13.9% increase in ad spending from 2023.
    - Influencer marketing outpaced other digital advertising channels, such as paid social and programmatic growth rates, with 66.8% of marketers increasing their budgets for influencer campaigns in 2024.
    - Brands allocated more than 30% of their marketing budgets to influencer campaigns, with nearly 24% dedicating over 40% to this channel.
  2. Effectiveness and ROI:
    - Influencer content consistently outperformed branded content, with higher engagement rates and conversions. Businesses reported an average ROI of $5.78 for every $1 spent on influencer marketing, making it one of the most effective digital strategies.
    - Authenticity and user-generated content were key drivers, aligning with your prediction that trusted recommendations from influencers resonate more with audiences than traditional ads.
  3. Comparison to Other Digital Platforms:
    - While overall digital ad spending grew by 7.4% in 2024, influencer marketing grew faster, driven by its ability to deliver higher engagement and targeted reach.
    - TikTok emerged as the most popular platform for influencer campaigns, surpassing Instagram.
    - It makes sense, given TikTok is its own affiliate network. Unfortunately, change is on the horizon.
    - Brands are increasingly leveraging nano- and micro-influencers for authentic connections. Balancing these with larger influencers is one of the most challenging tasks, which is why clients choose to work with us to improve their approach to influence marketing.
Affiliate Marketing 🟩
1. PREDICTION: Our beloved affiliate marketing industry will continue to experience very positive growth, outpacing many other “channels.”
2. ANSWER: Growth Rate: The affiliate marketing industry continued to thrive, with an annual growth rate of approximately 10%. This growth is significant compared to many other digital marketing channels.
3. Market Size and Influence: The global affiliate marketing industry was valued at over $17 billion in 2024 and is projected to reach $27.78 billion by 2027. Affiliate marketing accounted for 16% of all internet orders in the U.S., highlighting its substantial influence on e-commerce transactions.
4. Adoption and ROI: Most brands (81%) utilized affiliate marketing programs, and brands reported an average ROI of $15 for every $1 spent. This high ROI underscores the channel's effectiveness in driving sales and customer acquisition.
5. Strategic Importance: Affiliate marketing was considered a top acquisition channel for 40% of U.S. merchants, further emphasizing its strategic importance in digital marketing. This aligns with what we see from dozens of client testimonials sharing that Affiliate Marketing is one of their most efficient performance marketing channels!
Agency Winners & Losers 🟩
1. PREDICTION: We will see increased agency shuttering and consolidation. Winners in performance, differentiation, and emerging niches will thrive. The overall revenue pie will continue to grow as we innovate and evolve via deep specialization, expansion for those who can, and effectively leveraging smart hiring and AI.
2. ANSWER:
  1. Agency Consolidation:
    1. The advertising sector saw significant consolidation activities, highlighted by the major merger between Omnicom and Interpublic Group (IPG), valued at $13.25 billion. This merger aimed to create the largest ad agency company, reflecting the trend toward consolidation as agencies sought to gain scale and leverage data and AI capabilities.
    2. The M&A landscape was active, with agencies focusing on acquiring niche firms to enhance their digital transformation capabilities and meet evolving market demands.
    3. Private Equity is investing heavily in the ad agency market, which is not slowing down.
    4. Some notable acquisitions
      1. Audiens was acquired by Bango, highlighting a strategic move in the big data and marketing automation space.
      2. Crowd Digital Marketing acquired Noble, a software development firm, expanding its services to nonprofits and small businesses.
      3. Cyberwoven acquired Additive Agency LLC, enhancing its brand strategy and digital capabilities.
      4. New Engen acquired Donut Digital, strengthening its creative-led performance marketing services.
      5. RRD (R.R. Donnelley & Sons Company) finalized the acquisition of digital and print marketing businesses from Vericast, expanding its digital marketing offerings
      6. Spark ROAS, an e-commerce-focused digital marketing agency, was acquired by Bearcat Media.
      7. Artisan Colour acquired MarComm, integrating digital marketing strategies with commercial printing services.
  2. Emerging Niches and Specialization😀
    1. Agencies specializing in AI, data analytics, and sustainability were particularly attractive for mergers and acquisitions. These niches provided competitive advantages in a rapidly evolving market.
    2. Integrating AI into agency operations helped drive revenue growth and efficiency, supporting your prediction about leveraging smart hiring and technology.
PREDICTION: BTC will $60k 🟩
1. The current BTC price is $100k —> https://coinmarketcap.com/currencies/bitcoin/
PREDICTION ETH will hit $3,000 🟩
1. The current ETH price is $3,800 —> https://coinmarketcap.com/currencies/ethereum/
  Is BTC Digital Gold?
PREDICTION: VC funding will rebound 🟩
1. Global VC funding increased by 5% quarter-over-quarter in Q2 2024, reaching $94 billion across 4,500 deals. This marked the second consecutive quarter of growth after a significant slump in 2023.
2. In the U.S., VC-backed companies raised $37.5 billion across 2,794 deals in Q3 2024, with late-stage deal sizes rising year-over-year.
3. Consumer internet startups saw a 25% increase in VC investment compared to 2023's nine-year low, with later-stage VC investment up 83% year-over-year.
4. Challenges and Caution:
  - Despite these gains, overall deal activity remained subdued compared to pre-2022 levels due to lingering economic uncertainties and cautious investor behavior
  - Early-stage investments lagged behind prior years' levels as investors prioritized proven startups with clear paths to profitability.
Limited Tech Mergers and Acquisitions 🟩 true
Profit and smart growth over aggressive Top Line growth 🟩
🎥 Oscar Predictions:
1. Best Supporting Actress: Da’Vine Joy Randolph, The Holdovers 🟩
2. Best Supporting Actor: Charles Melton, May December 🟥 Robert Downey from Oppenheimer
3. Best Actress: Lily Gladstone, Killers of the Flower Moon 🟥 Emma Stone from Poor Things
4. Best Actor: Bradley Cooper, for his role as Leonard Bernstein in Maestro. 🟥 Cillian Murphy Oppenheimer
5. Best Director: Greta Gerwig, Barbie 🟩
6. Best Picture: Christopher Nolan, Oppenheimer 🟩