2024 Predictions #41

What does 2024 have in store?

Author

Tye DeGrange
January 03, 2024

2024 Predictions #41 🔮 

Happy New Year! 🎆 

2024 - what is in store?

We cover DTC Ecomm, ad platforms, media mix, football, and even Oscar picks. This is not investment 💲advice 😉.

2024 Predictions

🤞 Fingers crossed, we can be as accurate as the Simpsons 🙂 

Source: The Simpsons

  1. 📈 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%.

  2. 🏢 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. 🛍️ DTC Ecomm Brands 

    1. 💥 DTC enjoyed a boom from 2014-2021. But as we learned in 2022-2023, those days are over, and funding, endless growth, and discretionary spending are down.

    2. Those unable to differentiate and improve efficiency will shutter at one of the highest rates ever.

    3. The good news is that the US and Global EComm pie will continue to grow over time, and 2024 will be no exception.

    4.  🛍️ DTC Ecomm Brands that have improved their operational excellence, optimized for profitability, found ways to differentiate, improve cart size, limit CAC, and run diverse, effective performance marketing will continue to emerge victorious. We will see a number of them thrive. Shopify is an excellent example of the head, mid, and long tail of DTC EComm thriving. 

  4. 🛒 Shopify SHOP stock price. Shopify performed exceptionally well in 2023, with its stock pricing increasing 119% 2023. The stock is currently at $76.83; I estimate it will reach $125 in 2024.

    1. 🔍️ Refocused: Shopify divested from its two logistics investments in 2023 to focus on its core e-commerce business and product acceleration.

    2. ➕ Great TAM, market penetration of 11% (room to increase)

    3. ⚡️ Network Effect - Their app ecosystem gives them a network effect - meaning the more developers on the platform, the more value is provided to merchants, and the more merchants on the platform, the more opportunity developers have to build and earn for merchants.

  5. 🇺🇸 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%).

  6. 💼 Hiring will continue to improve in Tech and DTC 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. 

  7. 🤖 AI adoption will only continue as consumer brands and tech companies invest in testing to improve learning and operational efficiency.

    1. ChatGPT and Bard alone will report multiple billion users in 2024.

    2. From 2022 to 2032, the global market for generative AI is expected to expand from $8.65 billion to $188.62 billion, indicating a substantial growth trajectory.

  8. 🏈 NFL: My beloved San Francisco 49ers 🥇 will win the Super Bowl.

  9. NCAA: 🏈 The Michigan Wolverines will win the National Championship.

  10. 🤳 Meta - costs will continue to go up. But performance will justify it. Those that know how to tame the algo will crush. Those who resist it will be crushed. 

    1. In 2017, the average CPM was around $11.20. By 2021, the average CPM had risen to approximately $14.90, holding steady.

    2. Meta's advertising revenue in Q3 2023 was $33.64 billion, its highest ever reported.

  11. 🔎 Google - costs will continue to go up. Those that know how to tame the algo will crush. Those who resist it will be crushed. Sound familiar?

    1. According to Search Engine Land, in 2022, the average Google CPC was $4.01. However, in 2023, it increased to $4.22.

    2. Google Stock Price Target $155

    3. Google Ad Revenue reached all-time highs in Q3 2023 to $76.3B

  12. ⏱️ TikTok - at 1.5 billion monthly active users (MAU) in 2023 and growing, TikTok will continue to increase MAUs in 2024. They will be under fire from US regulators but not shut down, banned, or materially change ownership structure. Rumors of a buyer and some negotiations will happen, but nothing will materialize.

  13. 🫰 Snap - continue to eke out a turnaround and wins, build momentum post-cost cutting, and beat estimates as they did in Q3 2023 earnings.

  14. 🤼 Reddit - continue to eke out wins and IPO (see below).

  15. 📌 Pinterest - continue to eke out wins and serve as a valuable destination for advertisers in specific verticals like home decor.  

  16. 🏫 US University - College alternatives will continue to grow due to the high cost-to-value ratio. IBM, Google, Dell, Accenture, and Delta Airlines have already dropped the degree requirement, Source.

  17. 📸 : Influencers will outpace all growth in all digital platforms.

    • The savviest media buyers and brands have seen the data. The most effective ads are not ads at all, but trusted recommendations from influencers. The more user-generated, authentic, and real, the better.

  18. 🤝 Affiliate will outpace growth and increase market share more than any other “channel.” 

    • The Market Value of Affiliate Marketing Exceeds $17 Billion. (as of 2023). This is a significant increase from $13 billion in 2016.

    • Affiliate marketing spending in the United States is projected to have reached $8.95 billion in 2023, a substantial increase from the $5.4 billion spent in 2017.

    • The Performance Marketing Association reported a 47% growth in affiliate marketing investment from 2018 to 2021, reaching $9.1 billion.

    • There has been a noticeable synergy between influencer marketing and affiliate marketing. Influencers are increasingly becoming the “stars of the internet,” with more than 90% of consumers trusting an influencer more than an advertisement or traditional celebrity endorsement. Additionally, over 75% of brand marketers intended to dedicate a budget to influencer marketing in 2022.

  19. 📰 Media Houses will continue to adopt affiliate marketing and pursue consolidation to improve monetization 

  20. 🤳 Meta and ⏱️ TikTok 🛒 Shops continue to thrive, growing at a similar % in 2024, representing an even larger piece of the DTC Ecomm pie.

  21. 🏆️ Media Mix for 2024: The biggest channel winners in 2024 will be in order of growth rate:

    • ⏱️ 🛒 TikTok Shops

    • 🤳 🛒 Meta Shops

    • 📺️ YouTube

    • 📷️ Influencer (not listed but coming soon to Northbeam 😉 ?)

    • 🤝 Affiliate (not listed but coming soon to Northbeam 😉 ?)

  22. 📊 Agency winners and losers: 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.

  23. 📷️ Influencer spending, impressions, clicks, and revenue will continue to explode, led by mid-tier micro nano and those that can deliver measurable TOF and ROI 

  24. BTC will hit $60k in 2024

  25. ETH will hit $3k in 2024

  26. 👨‍💼VC Funding: we will see some rebound in VC startups investing in the number of dollars invested and the path to profit. 

  27. 🏦 The IPO market will rebound, but not to 2016-2020 levels 

    • Return on investment capital is going to drive start-up decisions more, and VC and LP payback period will need to change in a higher interest rate environment 

    • Notable IPOs in 2024:

      1. Stripe

      2. Databricks

      3. iBotta

      4. Reddit

      5. Liquid Death

      6. Fanatics

      7. Panera

  28. 💻️ Tech Mergers & Acquisitions - The Figma - Adobe deal is an example of Facebook - Instagram deals no longer being in 2024. 

    • Policy changes, new incentives or subsidies, or rate changes are required to change the merger and acquisition environment - they are far from gone, but there will be more scrutiny.

  29. 🤑 Profitability will continue to be the primary focus over scale for brands

  30. 🎥 Oscar Predictions:

    • Best Supporting Actress: Da’Vine Joy Randolph, The Holdovers

    • Best Supporting Actor: Charles Melton, May December

    • Best Actress: Lily Gladstone, Killers of the Flower Moon

    • Best Actor: Bradley Cooper, for his role as Leonard Bernstein in Maestro.

    • Best Director: Greta Gerwig, Barbie

    • Best Picture: Christopher Nolan, Oppenheimer

I am excited and hopeful for 2024. Of course, I am balancing it with preparation and cautious optimism as I think some areas and sectors will continue struggling.

We are fortunate to be working in the tech field that continues to move forward and see growth. It will require constant improvement and efficiency in a growingly global and competitive field.

You can check back with me next year to see how I did with my predictions!

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Seeing the growth 📈 and folks 👯 mentioning us and responding that it’s helpful has been a lot of fun.

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Let’s have a great year!