(Almost) Daily Musings

Evening all

Alston capital just raised a fresh EUR 175m for vintage three. An amount that would come in handy as Black Friday week is culminating in Cyber Monday.

I have to admit: I love making deals. And while it’s up for debate if buying a professional steam iron is a good deal, one thing is not: the fact that I will arrive in a professional-quality grade steamed shirt in the office tomorrow. Now, freshly equipped to start a dry cleaning business, I share today’s musings.

Cheers
Philip

Chart Art

AdTech

For years, Google has tried to position itself as an advertising company rather than a search company, likely to sidestep the anti-cartel hammer that comes with dominating a smaller, more concentrated market. But what if ads aren’t going through Google. Where do marketers go?

Amazon’s search-ad revenue surged 17.6% YoY, as users increasingly turn to platforms like Amazon or TikTok for their shopping searches and general queries (thanks, WSJ). This shift is driving ad dollars away from Google and toward its rivals.

With fewer users clicking on Google ads, the cracks are starting to show:

• Google search ad growth: a paltry +3% YoY in Q3.

• Retail media: +28% YoY—the MVP of ad spend.

• Social platforms: +5% YoY—picking up scraps.

As Perplexity tried to lure me into closing more Cyber Monday deals than I care to admit, the growing role of AI in advertising became glaringly obvious: AI is making its presence felt. New Street Research surveys earmarked that 60% of US consumers used a chatbot to help decide on a purchase in the past 30 days. Advertisers are following the money to retail and social platforms, where consumers already are.

As Perplexity tried to lure me into closing more Cyber Monday deals than I care to admit, the growing role of AI in advertising became glaringly obvious: AI is making its presence felt. New Street Research surveys earmarked that 60% of US consumers used a chatbot to help decide on a purchase in the past 30 days. Advertisers are following the money to retail and social platforms, where consumers already are.

Import / export

Industrial production in Germany is struggling, with mechanical and plant engineering taking a notable hit. Orders fell 9% YoY in October, with foreign demand plunging 14%. This naturally leads to questions about the trade balance, which isn’t exactly thriving either.

While the euro’s weakness should theoretically boost exports, it seems import slumps are outpacing any export gains—not that there would be any notable gains. Exports to EU Member States fell 1.0% YoY to EUR 205bn in Q3 2024.

Exports to non-EU countries tell an equally uninspiring story—the graph paints a clear picture.

There is one faint glimmer of hope: China. The country has shown increased imports, which could become a rare growth driver for Germany. Still, given the heavy reliance on the auto sector, which has seen little momentum since the pandemic, optimism remains cautious at best.

The trade balance is clearly under pressure, and for an economy as export-driven as Germany’s, that’s a story worth watching.