There's been a lot of noise about Meta's ($META ( ▲ 0.23% ) ) recent attribution model changes. Most of the takes circulating are either incomplete or wrong. Here's a clear breakdown - and more importantly, what you should actually do with your ad account.

What Changed (and What Didn't)

Meta redefined what counts as a "click" for attribution purposes. The short version: non-link clicks (likes, comments, shares, video views, etc.) are no longer categorized as "clicks" - they're now categorized as "engagements."

In practical terms:

• 7DC0DV (7-day click, 0-day view) is now roughly equivalent to 7DC1DE (7-day click, 1-day engagement)

• The only functional difference between these two windows is conversions that came from engagement-type clicks between days 2–7. Those conversions no longer attribute under any model - there's no 7-day engagement window to catch them

• The delta from that gap? Insignificant for the vast majority of accounts

One important correction to the timeline you may have seen: the rollout did not complete on March 18. It began on March 17 and finalized on March 26.

Before You Make Any Changes - Look at Your Own Data

The industry commentary on this update has been broad and often generic. Your account data may tell a different story than the accounts others are referencing.

At Avenue Z, our historical optimization strategy has centered on the attribution window most closely correlated to Meta's own incremental attribution model - which we've long viewed as the most directionally accurate signal of true ad impact. That window has historically been 7DC0DV.

The question after this update: is 7DC0DV still the right window to optimize on, or has the redefinition broken that correlation?

What the Data Shows

After pulling accounts of varying shapes, sizes, and verticals, a clear pattern emerged.

Prior to the late March update, 7DC0DV purchases tracked most closely with Meta's incremental purchase metric. After the click definition changed, there's a visible inflection point in the data — 7DC1DE (7-day click, 1-day engagement) becomes the more correlated line to incremental.

For accounts that mirror this pattern — which is the vast majority — the right move is switching optimization to 7DC1DE.

How This Affects Third-Party Attribution

If you switch to 7DC1DE and it's properly calibrated to your business performance, your third-party attribution reads (Northbeam, Triple Whale, etc.) should not degrade.

The risk is the opposite: if you don't switch and continue optimizing on a window that's increasingly decorrelated from Meta's incremental model, you'll gradually allow your ad account to optimize toward lower-quality signals. Over time, that decalibration manifests as channel performance decline - and your third-party tools will reflect it.

The goal is always to calibrate ad account performance to actual business performance. The attribution window is the mechanism that connects those two things.

Why Not Just Switch to Pure Incremental Attribution?

Meta does offer an "incremental" attribution setting. I'm not recommending it - at least not broadly.

The problem is event volume. Optimizing on a pure incremental signal sends back fewer conversion events to Meta's algorithm. That reduction in signal volume can jeopardize scale potential by limiting the data the algorithm has to learn from.

The goal isn't just to optimize on impactful conversions - it's to optimize on the highest volume of impactful conversions. More signal, better learning, better outcomes at scale.

The Theoretical and Numerical Case for 7DC1DE

Here's the framework I'm using:

If someone clicked through an ad and converted within 7 days - the ad had an impact on that conversion.

If someone engaged with an ad (liked, commented, shared, watched a significant portion of a video) and converted within 24 hours - the ad had an impact on that conversion.

Both of those user journeys are captured under 7DC1DE. That window now represents the most complete and accurate picture of ad-driven conversions that still provides sufficient event volume for algorithmic optimization.

That's not just theoretical. The data across our account set confirms it.

The Bottom Line

• Meta's update reclassified non-link clicks as "engagements" - the practical impact on most accounts is minimal on its own

• The rollout ran March 17–26, not March 18 as widely reported

• 7DC0DV's correlation to Meta's incremental model broke after the update

• 7DC1DE is now the most correlated window to incremental - and should be your new optimization target for most accounts

• Don't make reactive changes without looking at your own data first

• Pure incremental attribution carries event volume risk - 7DC1DE gives you the right balance of signal quality and scale

You’re reading In The Snow, by Jonathan Snow.

This is where operators, media buyers, and digital execs stay ahead of the curve.

Feel free to reply directly with any thoughts or feedback.

Insights from KeyBank’s Emerging Technology Summit

I just spent a full day in San Francisco at KeyBank’s annual Emerging Technology Summit speaking with institutional investors, technology leaders, and operators about the future of commerce.

One topic dominated nearly every conversation.

Agentic Commerce.

This is not a niche concept or speculative hype.
It represents the most significant shift in the consumer shopping experience since the rise of ecommerce.

The implications will reshape how consumers discover products, how brands get recommended, and how transactions occur online.

This article breaks down what agentic commerce actually is, what is real versus hype today, and what brands must do to prepare over the next three to five years.

What Is Agentic Commerce?

Agentic Commerce is a model of online shopping where autonomous AI agents act on behalf of consumers to discover, evaluate, and purchase products.

Instead of consumers manually browsing websites and marketplaces, AI agents perform much of the shopping process automatically.

An AI commerce agent can:

• Understand a user's preferences
• Anticipate needs based on context and history
• Search across retailers and marketplaces
• Compare products, prices, and reviews
• Evaluate tradeoffs such as quality vs price
• Recommend the best option
• Complete the purchase

In many cases, this process can happen with little to no direct human interaction.

The result is a shopping experience that is:

• proactive
• hyper-personalized
• frictionless
• increasingly automated

What Is an AI Shopping Agent?

An AI shopping agent is a software system powered by large language models and structured product data that can autonomously make purchasing decisions for a user.

These agents combine:

• LLM reasoning
• user preference modeling
• product catalog data
• pricing information
• merchant integrations

Examples beginning to emerge include:

• ChatGPT shopping integrations
• Perplexity commerce experiences
• AI assistants embedded in operating systems
• Amazon’s generative AI shopping features

Over time, these systems will evolve from advisors into active purchasing agents.

What Is Answer Engine Optimization (AEO)?

As AI agents become responsible for product discovery, brands must optimize their presence for AI recommendation engines rather than traditional search engines.

This discipline is called Answer Engine Optimization (AEO).

AEO is also commonly referred to as:

• Generative Engine Optimization (GEO)
• AI Search Optimization

Definition

Answer Engine Optimization is the practice of structuring content, product data, and brand authority signals so AI systems can understand and recommend your products.

In practical terms:

AEO = External Authority Signals + AI-Readable Data

Two components matter most.

1. External Authority (PR)

AI models rely heavily on trusted third-party sources to evaluate brands.

Signals include:

• media mentions
• expert reviews
• industry publications
• comparison sites
• marketplace reputation

These signals provide credibility and validation for AI systems.

2. On-Site AI Optimization

Brands must also structure their own data so AI models can interpret it easily.

This includes:

• rich product descriptions
• structured product attributes
• organized knowledge bases
• machine-readable catalog data

Without structured data, AI agents cannot reliably evaluate products.

If your products cannot be understood by AI systems, they cannot be recommended.

Why Structured Product Data Is Now Non-Negotiable

Structured product data is becoming one of the most critical assets in ecommerce.

AI agents rely on clearly defined product attributes to compare and evaluate options across retailers.

Examples include:

• specifications
• price
• materials
• features
• compatibility
• shipping information

When this information is structured correctly, AI agents can confidently compare products.

When it is inconsistent or incomplete, the product becomes difficult for AI systems to evaluate.

This is why major platforms like Shopify are pushing merchants to adopt agent-ready product data models.

Shopify just published an excellent breakdown on why structured product data is now non-negotiable; read it here: https://www.shopify.com/enterprise/blog/agentic-ready-product-data

Where Agentic Commerce Actually Stands Today

Despite the rapid progress in AI, fully autonomous agent-driven purchasing is still early.

Consumers are experimenting with AI for product research and recommendations, but large-scale automated purchasing has not yet taken hold.

For example, ChatGPT’s Instant Checkout integrations generated significant headlines, but widespread consumer usage has not yet materialized (likely because ChatGPT has really not even rolled it out publicly yet).

This is normal for a technology transition of this magnitude.

Two major factors will determine how quickly adoption accelerates.

The Two Barriers to Agentic Commerce Adoption

1. Consumer Trust

Consumers must feel comfortable allowing AI systems to access sensitive data such as:

• payment information
• personal preferences
• purchase history
• identity data

Early platforms may need to incentivize adoption, similar to how TikTok Shop used aggressive subsidies to drive initial usage.

Trust will develop gradually as consumers see successful transactions occur repeatedly.

2. Agent Performance

AI agents must deliver consistently strong recommendations.

In practice, this means agents must function like high-end personal shoppers.

They must be able to understand nuanced preferences such as:

• price sensitivity
• brand loyalty
• product quality expectations
• sustainability concerns
• aesthetic preferences

If agents consistently recommend the wrong products, consumers will revert to traditional shopping behavior.

Can Brands Simply Buy Their Way Into AI Recommendations?

The short answer is no.

Advertising inside AI systems may exist, but paid placement cannot replace AEO.

AI agents require structured product data and credibility signals in order to evaluate products.

Without those inputs, paid placements will either perform poorly or fail to serve entirely.

At the moment, advertising within AI systems is still extremely early.

Current ChatGPT media buys available include:

• direct campaigns through OpenAI
• Shopify Shop Campaign integrations (see my opinion on this here)
• emerging partner ecosystems like Criteo

Most of these solutions are still in early testing phases and lack mature targeting and measurement capabilities.

Why Shopify Is Positioned to Win the Agentic Commerce Era

Among ecommerce platforms, Shopify has moved aggressively to build infrastructure for AI commerce.

Key developments include:

• Agentic Storefront capabilities
• Storefront MCP integrations
• structured catalog APIs
• Instant Checkout integrations
• Shop Campaign distribution
• knowledge base infrastructure
• the Universal Commerce Protocol (UCP)

These initiatives allow Shopify merchants to expose product data and purchasing infrastructure directly to AI systems.

As a result, Shopify merchants are entering the agentic era with a meaningful head start compared to brands operating on fragmented commerce infrastructure.

Will Agentic Commerce Kill Traditional Marketing Channels?

Several fears surfaced repeatedly in conversations with investors.

Most of them are overstated.

Is Meta advertising going away?

No.

Agentic shopping is intent-driven, similar to search.

Consumers still need to discover brands before asking AI agents to evaluate products.

Top-of-funnel marketing remains essential.

Will Shopify ($SHOP ( ▼ 1.23% ) ) be disintermediated?

Highly unlikely.

Shopify is actively positioning itself as the infrastructure layer connecting brands, merchants, and AI systems while protecting its core revenue streams such as payments and subscriptions.

The Wild Card: Advertising to AI Agents

A fascinating idea beginning to surface in early discussions is whether brands may eventually advertise directly to AI agents.

If AI agents increasingly influence purchase decisions, brands may try to shape how those agents interpret their products.

Some experimental platforms are already emerging around this concept.

One example is Moltbook, a new Reddit-style social network where AI agents can interact, debate, and exchange information while humans observe.

While this concept still sounds experimental, it raises a broader question:

If AI agents become the primary decision-makers in commerce, where do those agents form their opinions?

Understanding that ecosystem could become a new frontier in marketing.

What Brands Should Do Right Now

Despite the early stage of adoption, the strategic direction is clear.

Brands should begin preparing immediately.

Three priorities stand out.

1. Build Structured Product Data

Ensure product catalogs include:

• standardized attributes
• detailed specifications
• consistent taxonomy
• machine-readable formats

This enables AI agents to evaluate products accurately.

2. Build External Authority

Strengthen brand credibility across trusted sources such as:

• expert publications
• industry reviews
• comparison platforms
• marketplaces

AI models rely heavily on these sources to evaluate brands.

3. Optimize Content for AI Discovery

Create content formats that AI systems can easily interpret, including:

• definition-based articles
• structured FAQs
• comparison guides
• authoritative industry explainers

These formats dramatically increase the probability that AI systems cite and recommend your brand.

The Bottom Line

Agentic commerce is still in its early stages.

We do not yet have large-scale real-world data on how consumers will behave when AI agents fully participate in purchasing decisions.

But the direction is clear.

The brands that win will be those that:

• understand AI discovery systems
• structure their data correctly
• build authority across the internet
• prepare their infrastructure for AI-driven purchasing

The shift toward agentic commerce is happening faster than most brands realize.

The companies preparing today will dominate the next era of ecommerce discovery.

One Final Thought

The question brands should be asking is no longer:

“How do we rank on Google?”

The question is becoming:

“Will AI agents recommend our products?”

That answer will determine who wins in the next generation of commerce.

Agentic commerce is still rolling out gradually - we don’t have massive real-world data yet. But it’s arriving faster than most brands are ready for.

The winners will be the ones who master AEO today, leverage platforms like Shopify, and think creatively about influencing the agents of tomorrow.

If your brand feels lost in the agentic shift, contact me. We just acquired a Shopify Premier Partner dev agency and are actively trailblazing this space. We’re productizing “Agentic-as-a-Service” to make winning the race to the agentic moon dead simple.

Catch Me at SXSW Next Week!

Are you going to be in Austin, TX next week for SXSW? Avenue Z is taking the stage with Profound to do live AEO audits for businesses revealing how ChatGPT, Gemini, Perplexity, and other AI-native platforms interpret and recommend companies in real time.

Learn More Here: https://schedule.sxsw.com/events/PP1162374

What I’m Listening to 🎧

Beats of the Week: SAMM (BE) & AJNA (BE) at Sonnbühel, Kitzbühel, Austria for MAJA (February 2026)

Samm & Ajna are rising. Been on my list to see them live but they don’t come to the US very often. Hopefully will check this off in 2026. This Après-ski set in Austria is a perfect blend of melodic vibes with their own unique recognizable style. Highly recommend.

You’re reading In The Snow, by Jonathan Snow.

This is where operators, media buyers, and digital execs stay ahead of the curve.

Feel free to reply directly with any thoughts or feedback.

2025 is Coming to a Close!

ANOTHER year in the books.

Overall, the year was mostly in line with my expectations. Super strong Q1-Q3, but Q4 disappointed slightly in terms of efficiency (not spend levels). Overall, the year met expectations.

Before we dive in to 2026 and what I think it has in store for us, lets see how my 2025 predictions fared…

2025 Record: 15-5-6

Not bad. Now onto 2026…

10 Predictions for Ecommerce in 2026

#1 - AI Creative is Not Just Usable… it’s Scalable

For those who still claim AI creative is “trash” and “slop”… they just don’t know what tools are available or how to use them.

We’ve been scaling both video and image AI creative on every channel (Meta, TikTok, AppLovin, Snap) successfully for over a month now.

Not through any ad platform’s native tools though (those are still trash), but through a combination of third party AI creative tools.

Marketing has become a game of systematizing tools and signals. And calibrating it to business performance.

The black box ad platforms were supposed to make media buying easier, but in fact it’s muddied the waters and pushed marketers & creatives into uncharted territories.

Those who know how to use the tools efficiently and at scale are the ones who will thrive. Marketers and creatives are one and the same right now. The lines have never been more blurred.

This has been a major focus of mine for the last 6 months and it’s paying off.

#2 - TikTok Shop GMV Growth in the US ACCELERATES

Many talking heads claimed social commerce was a fad that would fade into the abyss. They couldn’t have been more wrong.

I’ve been bullish on TikTok Shop since Day 1. Thankfully we made this a priority since the early days. We’re not left scrambling to figure it all out now out of necessity (like many brands and agencies). I saw the writing on the wall. Getting UGC at a super low cost, super high volume, and 10x more efficient than traditional influencer UGC was extremely attractive. Creating momentum & brand awareness for the cost of product samples was always a no brainer to me. Using that content as a creative testing ground to unlock new investable creators and reach new audiences is something that you could only do on TikTok Shop.

Here’s how TikTok Shop in the US has fared over the last few years:

2024 ~$9B

2025 ~$16B (projected)… 78% growth

What does 2026 have in store?

I’m going to make a BOLD prediction and estimate that it hits $30B in GMV in the US in 2026. Brands are really coming around to TikTok Shop now and have accepted that it’s a place they need to be present on… or risk having their competitors steal market share there.

Here are some well-known brands that launched on TikTok Shop in 2025:

QVC, Meta, Shark, Ninja, Crocs, JBL… just to name a few.

I’m expecting even more big names in 2026.

#3 - Meta Rips TikTok Shop

Meta (yes, $META ( ▲ 0.23% ) ) quietly launched on TikTok Shop this past month. Curious move.

In the L30 days, they've done $3M in TTS revenue. Nearly all GMV through affiliates. They're now a Top 50 seller on the platform.

What's even more interesting...

They have 5x more ads live on TIKTOK right now than on their own platform (Meta). Meta isn't just going through the motions, they are going ALL in on TikTok Shop.

So, one of these 2 scenarios is in play:

1. Meta is just reverse engineering the entire affiliate/Shop ecosystem for its ultimate relaunch of social commerce.

2. Meta finds value in selling its consumer products on TikTok Shop.

Let’s be real… Meta doesn’t need TikTok to sell its products, its own ad platform is far more powerful.

AND there’s no better copier than Zuck. Over the years, Meta’s best products were virtual copies of other platforms: Reels, Stories, Threads, and Live.

Shop is next! Mark my word.

#4 - Top Share of Wallet Gainer: AppLovin (…again)

Another talking heads topic. The talking heads, short sellers, every Negative Nancy in between… wrong in 2025.

“AppLovin is a scam.”

“AppLovin is run by Chinese spies.”

“AppLovin just steals Meta’s homework.”

Yadda yadda.

My prediction a year ago came just before the mainstream madness ensued when $APP ( ▲ 3.22% ) launched it's ecom beta…

Twitter tweet

The stock has 5x’ed since then… mostly due to its successful venture into ecom ads.

In 2025, according to Northbeam, AppLovin was the 3rd highest spend channel for ecom brands (after Meta and Google), eclipsing YouTube, TikTok, Snap, Reddit, Pinterest… by orders of magnitude.

And it’s still in closed beta! Invite only.

The platform is far from perfect, but traction like this can’t be ignored.

I feel like they’re just getting warmed up and they have a super sharp, hungry team that UNDERSTANDS performance marketing. I have extreme faith in them evolving the platform to everyone’s benefit.

And so, I’m predicting that it once again takes the crown for biggest share of wallet gainer… in 2026. Somewhere in the ballpark of 5-8% (will be using numbers reported by Northbeam).

#5 - Traditional Pay-for-Post/UGC Influencer Model is DEAD

Creative Volume. Creative Diversity.

The two most important phrases of 2026.

Not just for Meta. For all AI/ML-driven ad platforms.

Traditional UGC model has been this for the past few years:

pay for the piece of UGC w/ usage rights, pay for whitelisting access, do this with a couple dozen influencers per month, have the influencers follow this overly engineered creative brief, take weeks to deliver a finished piece of content. Each piece of UGC comes out to $1k when you consider your own human resources to manage this.

This model does not achieve creative efficient volume or diversity. It is simply not aligned with Meta (and other platforms’) business objectives.

Enter affiliate influencers (via TikTok Shop).

Here’s how it works:

pay for UGC only when the creative leads to an attributable sale, get usage rights for free, get whitelisting access for free, have affiliate influencers loosely follow a creative brief, do this with hundreds if not thousands of influencers per month, and automate most of it.

TikTok Shop is THE most cost effective and efficient solution to achieve both creative volume and diversity.

We’ve 4x’ed brands SHOPIFY revenue in under a year purely thanks to TikTok Shop affiliate content that we amplified across channels.

THIS IS THE PLAYBOOK!

#6 - Snap Continues its Rise 📈

$SNAP ( ▼ 3.03% ) has been quietly crushing for us.

In 2025, it became a meaningful part of our media mix. All thanks to 2 meaningful updates Snap made to its ad platform.

1. 7DC0DV Optimization

2. Target Cost bidding

Prior to these 2 things, I had conviction Snap did not drive any real measurable performance. Things have changed.

The platform should continue to get better.

Leverage your TikTok Shop affiliate content, launch it on Snap. Thank me later.

#7 - Meta’s AI Agents Fuel Incremental Performance Gains

Meta just bought Manus for ~$2B and planning to incorporate it into its consumer AND business units.

On the business front, expect Meta to leverage Manus tech to create AI agents for its advertisers both on and off platform... throughout the ENTIRE FUNNEL.

Meta already has on-site agents in motion for advertisers (few actually know this). These agents are designed not just to help convert users on brands' sites, but also to gather all of this off-platform signal & send it back to the pixel to inform the algo. Meta has been strong. It's going to get even stronger.

Meta’s Manus-driven agents will indisputably help fuel further performance gains for brands through direct attributable revenue & through 0-party signal enhancement.

Imagine the AI agent on site helping customers with nuanced personal questions such as “is this ok to eat if you have a peanut allergy?” or “what’s the best outfit for my annual ski vacation?”. Meta will gobble up any/all information users submit to its agents and use that to enrich your user profile (not just on the brand’s targeting, but on that user’s targeting on the platform for all brands).

#8 - Consumer Sentiment Rebounds to Highest Level Since 2021

2025 was a BRUTAL year for the consumer.

Inflation, high interest rates, debt, loan defaults, job market weakness….all bad.

As such, the Consumer Sentiment Index reached its LOWEST level since 2022 in November 2025, ringing in at 51.0.

My prediction is that we will see a massive surge and break the 80.0 level in 2026 at some point. All thanks to a softening Fed policy w/ expected declines in interest rates, cooling inflation, and potential stimulus programs looming.

This would be very good news for $SHOP ( ▼ 1.23% ) .

#9 - Organic Social Becomes a Performance Channel

Thanks to the current trajectory of AI creative, I am predicting that organic social (namely IG, FB, and TT) becomes a real performance channel in 2026.

The things we’re seeing with AI creative right now have me very hopeful we’ll have a fully automated system to publish hundreds of creatives daily to brand, persona, and blog style organic social handles. Lets do some simple math…

If we publish 100 creatives organically per day… if each averages 100 impressions, that’s 10k impressions per day… 30 days per month puts us at 300k organic impressions at virtually $0 cost. If we ramp it to 300 creatives per day, now we’re talking something in the ballpark of 1m organic impressions per month.

Inevitably, 1-5% of them will outperform by a standard deviation and we’ll decide to put ad spend behind them.

AI creative will serve us as both an organic upper funnel channel and automated creative pipeline generator.

AI simply fuels performance everywhere.

#10 - Performance Product Sampling Scales to IRL/Events

TikTok Shop product sampling took the world by storm over the past few years.

It’s more of a ‘cast a wide net’ volume approach, which is great.

But what if you could sample products out to people in the exact niche you’re looking to target?

Enter IRL events.

Testing a really interesting new event/IRL sampling platform that I have high hopes for.

Integrating offline/IRL with online/digital will be the real challenge.

Will be reporting on performance & impact in 2026. BULLISH.

That’s a wrap!

Wishing you all a very….

🎉 HAPPY NEW YEAR 🎉

May you have a blessed 2026, may it be your best year yet!!

What I’m Listening to 🎧

Beats of the Week: MoBlack at GIZA Pyramids for Zamna

Ooooh this was a good one. Giza Pyramids backdrop, unique middle eastern infused beats. Vibes on vibes. Give this one a listen, but probably better viewing on the big screen while sitting on the couch with a beverage in hand.

You’re reading In The Snow, by Jonathan Snow.

This is where operators, media buyers, and digital execs stay ahead of the curve.

Feel free to reply directly with any thoughts or feedback.

IT’S BEEN A WHILE!

It’s been 4 months since my last proper newsletter. All it took was BFCM to give me a shot in the arm to get me back on the content grind.

It’s been a BUSY last few months, content had to take a backseat for a bit. Been spending a ton of time building in-person teams here in our Miami office and have been going deep on genAI creative with the team. I’ll dedicate my next newsletter to genAI creatives and share some examples of ad creatives we’ve made. The future is here.

Moving forward, I plan to keep my newsletter monthly.

Quick aside - about 6mo ago we decided to focus all hiring efforts for our media/creative team in-office with a minimum of 4 days per week in the office.

Long story short, it’s been a total game changer. The amount I’ve seen people grow in such a short timeframe has been a great reminder of the pre-COVID office era. People are growing here more in 2 months than they did in 2 years being fully remote. There’s also something to be said for building a real culture in person. It’s not impossible with a remote workforce, but it sure as hell is way harder! Building a thriving business in ever-changing times is already hard enough. Having people in office rowing in the same direction is something that can stack another chip on your side.

Now… onto the BFCM 2025 Post-Mortem!

Overall, 2025 Cyber 5 (Thanksgiving through Cyber Monday) was a bit uneventful & slightly disappointing compared to last year.

2024 was largely an ok year, but Q4 and Cyber 5 surprised in a big positive way.

Overall, 2025 has been a great year compared to ‘24 and I expected Cyber 5 to continue that trend. However, Cyber 5 was kind of muted. I’d say it was slightly below or in-line with my expectations.

2024 is also a really tough comp year for ‘25. If you recall, holiday shopping season was shortened last year (the number of days between TG and Christmas) which means revenue consolidation AND there was a big spending spree following the election.

2025 didn’t benefit from either of these factors, but nonetheless will be pegged against them!

Also notable is the state of the consumer right now.

November 2025 just closed as the worst Consumer Sentiment Index month since June 2022! That’s 3.5 years 🤯

Anytime there is softness in the consumer, you can expect a similar softness in performance marketing efficacy.

If consumers aren’t spending as freely, that means they’re less likely to impulse purchase from your social media ad. With rising ad costs & lower discretionary consumer spending, you can expect lower performance of your ads.

I track KeyBanc’s Consumer Spending trends closely and you can note how 2024 had a big YoY spike in growth (baby blue line) for BFCM time frame, yet 2025 showed 0% growth (red line). Adjust for inflation and 2025 had negative growth YoY.

Here’s how media mix looked for our book over Cyber 5:

Meta: 58%

Google: 22%

Axon (AppLovin): 10%

TikTok: 6%

Snap: 4%

💥 Overall, spend in our book exceeded 50% YoY growth. Meta is still king and spend grew significantly on the channel this year. BUT, in terms of media mix share, Meta lost ground to new kids on the block like Axon, TikTok, and Snap.

As I’ve been saying all year, this is the only time in all of ecommerce that there have been THIS MANY viable paid ad platforms. And yes, they’re able to reach new audiences. They don’t just eat each other.

Paid media efficiency (ROAS, CAC, CPP) all took hits this year across the board. For the ad platforms, it was a big Cyber 5. All mentioned above should have solid earnings this season. $META ( ▲ 0.23% )  $GOOGL ( ▼ 0.41% )  $APP ( ▲ 3.22% )  $SNAP ( ▼ 3.03% )  $SHOP ( ▼ 1.23% )  

For brands? We’re hoping for a solid wrap to the quarter. We have an extra day of holiday shopping this year, so perhaps we’ll see this all normalize.

Despite a softer Cyber 5 than we had hoped, we are still bullish on the rest of the year and 2026.

Does Black Friday/Cyber Monday still have the same cachet that it once had? A counterargument…👇

What you’re seeing above is a screenshot from my Particl dashboard showcasing Free People’s estimated revenue for the month of November and early December.

I use Particl to analyze competitor and industry/category trends religiously. By spotting revenue trends and analyzing peaks and troughs for a variety of brands, we’re able to get insights into what’s working & reverse engineer tentpole moments to feed inspiration for our clients. With Particl, you’re able to drill down into product sales and marketing assets (email/SMS, Meta ads, etc) deployed over any time frame to give you visibility into what triggered spikes in revenue.

So in the screenshot above highlighting Free People’s GMV, do you notice something odd?

Their biggest revenue days happened in mid-Nov (Nov 14-15), NOT during Cyber 5.

For a brand doing close to $10-figures in DTC GMV annually, this isn’t by accident.

When I took a look under the hood, here’s what I found:

Nov 14 they launched their best sale, the “Everything Sale,” which required multiple product cart sizes ($250+ AOV) to get the discount👇

Then, on Black Friday, it seems like they didn’t even have a sale go out.

On Cyber Monday, they launched the 40% off sale, but ONLY on the styles that were already on sale in the Sales collection. Typically these are either undesirable items or those with outlier sizes available.

Despite there being no sale on Black Friday, there was still a mini bump. Probably by consumers who were holding out for a sale that never came & capitulated to purchase the products they were going to purchase anyways (regardless of the sale).

It’s clear the 40% off All Sale Cyber Monday offer did little in terms of revenue generation.

That being said, Free People decided to activate their best sale 2 weeks in advance of Black Friday. Are they onto something?

During Cyber 5, consumers are overloaded with different sales and offers. Brands are all competing for attention and consumers budgets only shrink as the weekend progresses.

During years like this one, where consumer sentiment & strength are at super lows, it could be savvy to get in front of your customers & prospects first, while consumers’ budgets are robust & your competitor’s budgets are in a holding pattern for Cyber 5.

Do people really care about Cyber 5 itself, or are they just waiting for the best deal a brand offers, regardless of the day?

If it’s the latter, it might make sense to hit consumers before your competitors do.

If the sale misses the mark, you have another opportunity on Cyber 5 to make up for what you left on the table.

Something to chew on for next year!

What I’m Listening to 🎧

Beats of the Week: SEBASTIEN LEGER b2b ROY ROSENFELD ARCANA ENTRE RIOS (2025)

I’ve been sharing a ton of Afro house sets, but it’s time to change things up a bit and share some of the melodic house sets that have been getting my attention. Roy Rosenfeld has definitely made my list before, but he’s been heating up B2B with Sebastien Leger through their Lost Miracle act. Virtually no lyrics, just pure vibes. Great music for deep work that takes you on a journey more than most of the Afro house sets that tend to cater more towards party vibes.

ENJOY!

You’re reading In The Snow, by Jonathan Snow.

This is where operators, media buyers, and digital execs stay ahead of the curve.

Feel free to reply directly with any thoughts or feedback.

Is Google Fudging Search Volume Numbers w/ LLM Bots?

Twitter tweet

In a recent viral thread on X, investor Chris Camillo raised eyebrows by suggesting that Google's reported search query growth might be artificially inflated by AI-driven queries from tools like ChatGPT, rather than genuine human activity.

While Chris's hypothesis is intriguing, it veers into conspiracy territory and overlooks how AI is actually enhancing Google's ecosystem as a complementary top-of-funnel channel. If you're researching "Google search volume AI impact," "Chris Camillo Google allegations," or "is Google inflating search numbers with AI," this post breaks down why these claims don't hold up based on real-world data and industry insights. Let's dive in!

Understanding the Allegations: Chris Camillo's Thread on Google and AI

Chris Camillo, known for his unconventional investing strategies and featured in Unknown Market Wizards, posted a detailed 11-part thread on X. Keep in mind he is SHORT $GOOGL ( ▼ 0.41% ) ; so there is bias. His serious allegations could be designed to nuke the stock and fulfill his own prophecy. Or he could be short Google because of the allegations. This remains unclear. Nonetheless…

He argues that:

• Google's search revenue growth (up 12% YoY to $54.2B in Q2) could be masking a decline in human searches, as evidenced by Apple executive Eddy Cue's testimony that Safari searches fell for the first time in 22 years due to AI adoption.

• Anomalies in Google Trends data, like unexpected spikes in searches for brands like Lululemon, might stem from AI bots generating queries.

• A personal test with ChatGPT querying a made-up term ("organic Abercrombie socks") showed up in Trends, implying AI traffic isn't filtered out there.

• Advertisers might unknowingly pay for AI-generated clicks, raising ethical and financial concerns.

Chris calls for transparency. And he is not wrong. But until we get that transparency, Google is innocent until proven guilty. It's a thought-provoking take, especially amid ongoing antitrust scrutiny of Google. But as a DTC marketer who's managed millions in ad spend, I see a different picture - one where AI boosts, rather than fakes, Google's value.

My Take: ChatGPT and AI act as a complementary force for Google Search

Contrary to the inflation narrative, AI tools like ChatGPT are acting as a top-of-funnel accelerator for organic search, driving more human engagement to Google... for now. Here's why this complementarity makes sense, and why it's a net positive for Google:

1. AI Sparks Human Branded Searches

ChatGPT often serves as an initial discovery tool. Users ask broad questions (e.g., "best activewear brands"), get recommendations, but rarely does ChatGPT surface the direct link where you would purchase the product. Rather, it surfaces links that are mostly 3rd party validation (PR pieces) that the LLM used to inform it’s recommendations. The natural user behavior after getting a ChatGPT-recommended product is for the user to go to Google and initiate a branded search query. This creates a "linkless word-of-mouth" effect: people head to Google for branded searches like "Lululemon leggings" to dive deeper, shop, or verify.

This isn't bot traffic- it's genuine human curiosity sparked by AI. In my experience, this leads to spikes in branded search volume that wouldn't show up in traditional UTM tracking. It's why we've seen steady or improved performance in Google Ads campaigns this year, even as AI usage rises. If AI were replacing human searches, we'd expect dips in conversion rates or ROI, but that's not happening.

2. Google Trends vs. Search Volume Reports: Not the Same

Chris points to Google Trends anomalies as evidence of AI interference. However, Trends data measures relative interest (normalized on a 0-100 scale) and explicitly filters out low-volume or spammy queries. It's not a direct proxy for absolute search volume reported in earnings.

Earnings-related search growth comes from monetizable queries, which Google rigorously vets for quality. Comparing the two is misleading. Plus, Google's sophisticated systems (using machine learning and user signals) can easily distinguish bot vs. human traffic. Inflating numbers with AI sessions would be a massive risk, exposing them to advertiser lawsuits, regulatory fines, and loss of trust in an already scrutinized antitrust environment.

3. The Conspiracy Angle: Unlikely and High-Risk for Google

The idea that Google would deliberately include "fake" AI clicks in ad revenue feels like a stretch. Why?

• Technical Feasibility: Google has invested billions in AI detection (think reCAPTCHA and beyond). Bot traffic is flagged and excluded from billable clicks per their AdWords policy.

• Business Ethics: Revealing such practices would erode advertiser confidence overnight. As Chris notes, advertisers aren't paying for invalid clicks, but extending that to undisclosed AI traffic would be extremely dishonest and self-serving, something Google couldn't hide in today's transparent data era.

• Real-World Evidence: In my agency's portfolio, we haven't seen any decline in ad performance tied to AI rise. Click-through rates, conversions, and ROAS remain strong. If non-human clicks were flooding the system, we'd notice diluted results. Especially because AI-derived clicks still can not transact autonomously. Aka these AI clicks would never convert and impact performance. Once again, something Google would not be able to hide. Instead, AI is funneling higher-intent traffic to Google.

Nonzero chance? Sure. But the downside (antitrust escalation, class-action suits) far outweighs any short-term gain.

What Advertisers & Investors Should Watch For

If you're an advertiser worried about "AI-driven Google search inflation" or an investor eyeing $GOOGL amid "ChatGPT vs. Google search" debates:

• Monitor branded vs. non-branded search trends in your Google Analytics.

• Test AI prompts yourself (like Chris did) but cross-reference with ad performance data.

• Push for more disclosure: Google could clarify AI traffic handling in Trends and ads without much hassle.

What are you seeing? Drop your thoughts in the comments below or reply to my take on X.

Final Thoughts: AI as Google's Ally, Not Enemy

Chris's thread highlights valid concerns about transparency in an AI-disrupted world, but the evidence at this very moment points to synergy, not sabotage. ChatGPT isn't cannibalizing Google; it's feeding it with primed, high-intent users. As AI evolves, expect even tighter integration, perhaps Google licensing more AI tech to stay ahead.

Disclosure: I hold $GOOGL stock.

You’re reading In The Snow, by Jonathan Snow.

This is where operators, media buyers, and digital execs stay ahead of the curve.

Feel free to reply directly with any thoughts or feedback.

7 Months Down, 5 to Go

Can you believe we’re already one month into Q3? Black Friday sales are just 2 months away 😂 And who knows… maybe we see them even earlier this year?

Lets get right to it!

👀 Industry Updates:

• Amazon leaves Google Shopping: AMZN’s shopping impression share tanked to 0 this past week in the US, UK, and Germany. What do we make of this? Amazon not wanting Google to have their data b/c of the AI race or ad platform competition?

• Meta unveils GenAI Creative Roadmap: Meta is finally making big moves in the AI creative world. I broke down their 6 most important updates for marketers here.

• Consumer Sentiment: As tracked by the University of Michigan, Consumer Sentiment Index is on the rise since the April-May low. CSI trends are tied fairly closely to S&P 500 performance so this is not a surprise. We’re still lower than we were a year ago, so not all is great. But we’re headed in the right direction. We want this number to keep ticking higher. The more confident consumers are in this economy, the more they’ll spend on discretionary purchases, and the better our ads will perform.

  

1. AI Search: What media outlets are most frequently cited?

If I told you that Lemon8 is the TOP social media channel cited by LLMs, would you believe me?! 🤯

AI search optimization requires insight into each platform's algo. I'm going to show you how different ChatGPT, Perplexity, Google AIO's models are.

At Avenue Z, we reverse engineer each model by tracking citation patterns over time for different product verticals.

In the image below, you'll find aggregate data from our AI Visibility Index on the media sources that were most frequently cited across models in July for beauty brands.

📝 Important to note:

• Lemon8 is the TOP social platform cited & RISING

• Byrdie had been the dominant publisher, but now in a steep decline

• LLMs are citing all types of media sources: editorial, social, and marketplace/corporate

👀 In the 3 images below, you'll see how it breaks out by LLM:

ChatGPT's model

• LOVES Reddit; by far the most cited media source

• uniquely prefers Wikipedia more than other LLMs

• doesn't use links/citations nearly as frequently as other LLMs

• doesn't love social media.. yet

Perplexity's model

• LOVES YouTube

• LOVED Byrdie, now hates it... went from 45-50% citation rate to 0% on July 19

• prioritizes shopping over other LLMs which is why Sephora is cited so frequently to enable product recommendation purchases

Google AI Overviews's model

• is in FULL BLOOM love with Lemon8 (it's cited in nearly every chat & in some instances cited multiple times w/in a chat)

• uses links more than any other LLM (Google still wants them clicks!)

• just started indexing Instagram content on July 10. I expect to see Lemon8 citations to decrease as IG begins taking up share.

Oh, and it’s time you add THIS option to your post-purchase survey, do NOT forget:

Since AI search mentions far outweighs AI search direct links to your site, don’t rely on click-based attribution to measure AI search performance. Have customers tell you how they discovered your brand. This will fill in the gaps immensely. We’re seeing customer-reported responses far outweigh UTM-based ChatGPT/Perplexity/Google AIO conversions.

2. Event Quality is Directly Correlated to Ad Performance

If you have 2 CAPI solutions active simultaneously, you're likely limiting your ad performance ⚠️

I'll show you an example of this below.

Duplicate CAPI setups happen so frequently these days bc many SAAS tools now offer server-sided tracking:

• Blotout, Elevar, Popsixl

• Shopify <> Meta CAPI

• Triple Whale (Sonar) & Northbeam (Apex)

• Angler ... the list goes on!

Typically a brand is signed up for more than one of the above concurrently (for diff reasons) & ends up turning on CAPI integration for each rather than select ONE (and ONLY one).

This often goes undiagnosed by brands and marketers. It makes performance look BETTER in-platform since conversions are duplicated.

In reality? Business performance & 3P measurement tank. It's a hidden parasite.

Most marketers don't even know how to diagnose when this is happening to their brand.

So, how do you know if you have more than one CAPI firing? Check the image in the comments section for an easy way to spot it!

When this happens, you have the same event getting sent back to Meta from 2 diff sources which instantly crushes your Event Match Quality (EMQ) score.

Bc these SAAS companies don't communicate, events aren't properly deduplicated.

So what's the actual impact of a lower EMQ score?

In the image above, you'll see an example where a 2nd CAPI was activated on July 17.

Immediately following this, EMQ tanked below a 6/10. Each event was impacted similarly, but for illustrative purposes below I only included the "View Content" event.

Immediately following the EMQ decline, Triple Whale ROAS tanked at the same rate (platform-reported ROAS erroneously perceived to improve bc of the duplicate events).

On July 23 we identified the duplicate CAPI & shut it off. EMQ (and thus TW ROAS) immediately rebounded, as expected.

This is why we start every audit with the basics: EVENTS MANAGER.

Garbage in, garbage out. Without event health in place, you're feeding the platform's AI/ML trash. Your performance will be limited.

Events manager is not a sexy place to spend your time. But you MUST master it and have a pulse on EMQ at ALL TIMES.

It's usually the place where all the hidden issues live.

3. Media Mix for Ecom Brands: a 2H Update!

Northbeam has been putting out weekly data on its aggregate tracked spend. It’s super useful for brands to get a pulse on where spend is being allocated in ecommerce. I track it religiously.

AppLovin ($APP ( ▲ 3.22% ) ) is about to eclipse 4% of total budget share. Their share of the pie has grown 7% in 2 months.

📝 Things to note on AppLovin: still in closed beta & eligible brands have ~1 month wait right now to onboard.

There's actually far more to this graphic than AppLovin's rise:

➡️ TikTok gaining ground (yes it's still working; our investment there is increasing)

➡️ YouTube ($GOOGL ( ▼ 0.41% ) ): for the FIRST TIME EVER I am excited. Why? You can finally run Demand Gen campaigns with SHORTS ONLY placements. Seeing measurable click-through performance that deserves your attention. Going to spend a lot more of my time here moving forward.

➡️ Snapchat ($SNAP ( ▼ 3.03% ) ): meteoric rise (+29%) over the past couple weeks, surging past 1% of total budget share. We've been bringing budget to Snapchat for the first time in years over the past few months. This is all bc of their new 7DC0DV optimization window that's shown to drive performance (unlike the other models).

We're now living in a time where DTC brands have MULTIPLE top of funnel channels to choose from to diversify investment.

This doesn't mean $META ( ▲ 0.23% ) ad spend gets eaten. It means the pie will grow at a faster rate than it has in the past few years.

Exciting 📈

What I’m Listening to 🎧

Beats of the Week: Kitty Amor - Live From SDL Festival, Ibiza 2025

Kitty Amor is a vibe. Dark energy. Beats on beats. Listened to this set a few times already. Have this on repeat for your next deep work session.

You’re reading In The Snow, by Jonathan Snow.

This is where operators, media buyers, and digital execs stay ahead of the curve.

Feel free to reply directly with any thoughts or feedback.

🏆 Discover Which Brands Are Winning (& Losing) the AI Search War… and Why.

The way consumers discover and buy products is being redefined- not by influencers, not by search engines, but by generative AI.

From ChatGPT to Perplexity to Gemini, today’s AI assistants are becoming the ultimate product recommendation engines, a new form of word-of-mouth. They’re shaping not just what consumers see, but what they trust and buy.

Our team at Avenue Z just released the most comprehensive DTC industry benchmark report ever on this topic:  The AI Visibility Index: Beauty Edition (2025)

🚨 Why This Report Matters

• 92% of prompts on Perplexity now trigger AI-powered shopping suggestions.

• Only 25% of cited sources in AI responses are owned by brands.

• "Viral" and "Top-Rated" brands outperform legacy brand recognition.

• Brands like Rare Beauty, Olaplex, and amika are dominating- while many heritage names are invisible.

This isn’t just an SEO update. It’s a visibility revolution where arbitragers will win, at least in the short term. The platforms that once favored domain authority now reward ubiquity, sentiment, and third-party validation.

🧠 Inside the Report

We analyzed over 100+ real-world beauty shopping prompts and tracked 60 of the biggest beauty brands across ChatGPT, Perplexity, and Google’s AI Overviews- daily -for months. We then ranked them using our proprietary Z-Score framework, combining:

• AI Search platform mentions (AI Search “visibility”)

• Brand sentiment

• Shopping assistant appearances (AI Shopping)

• Citation frequency

• Technical SEO signals

🧬 Key Takeaways for CMOs & Growth Leads

• AI Shopping is happening now. 1 in 4 ChatGPT queries and nearly all Perplexity queries surface shopping modules.

• Media matters. Third party mentions are disproportionately cited.

• Sentiment drives inclusion. Brands with favorable sentiment online are far more likely to appear.

🔍 Curious Where Your Brand Stands?

Whether you’re a growth-stage DTC disruptor or a global conglomerate, this report shows how AI models really see you. And more importantly, how to move up the ranks.

What are the Acronyms Commonly Used When Referencing AI Search Optimization?

AIO & AISO: AI Search Optimization

LLMO: Large Language Model Optimization

GEO: Generative Engine Optimization

PEO: Perplexity Engine Optimization

SGVO: Search-Generated Visibility Optimization

AEO: Answer Engine Optimization

While confusingly used interchangeably, the industry is tossing around new terms everyday and we’ll see what sticks. Personally, I like AIO. It’s clean and direct. But when you hear any of these, they’re all referencing AI Search Optimization.

Next Up?

This is our first of many ecommerce industry reports. Our next vertical will be in the health & wellness space with a focus on supplements & nutrition.

Publicly Traded Companies Featured in this Report:

$LRLCY ( ▼ 0.5% ) : L’Oreal

$EL ( ▼ 0.85% ) : Estee Lauder Companies

$PG ( ▼ 1.02% ) : Proctor & Gamble

$LVMH ( 0.0% ) : Louis Vuitton Moët Hennessy

$UL ( ▼ 0.21% ) : Unilever

$ELF ( ▲ 1.88% ) : E.L.F Beauty

$SHOP ( ▼ 1.23% ) : Shopify

$CRM ( ▼ 3.45% ) : Salesforce

$BIGC ( 0.0% ) : BigCommerce

What I’m Listening to 🎧

Beats of the Week: ‪Tripolism @ Nørrebro Street Party | Copenhagen

These guys are electric. I saw them live in NYC a few weeks ago and it may very well have been the best live set I’ve ever witnessed. Remember their name, they’ll be rising the global ranks of best artists this year.

You’re reading In The Snow, by Jonathan Snow.

This is where operators, media buyers, and digital execs stay ahead of the curve.

Feel free to reply directly with any thoughts or feedback.

Meta’s Game-Changing Generative AI Ad Tools Unveiled – A Must-Read for Marketers

Meta has been talking about Advantage+ Creative for a while now (and pushing it on us), but it looks like it may finally be usable by end of year. Meta just published their GenAI progress following Cannes Lions 2025 and it’s going to tangibly impact the way we advertise there.

It’s no secret: Meta has been offering up to $100M signing bonuses to snag AI talent from OpenAI and DeepMind. This is Meta doubling down on generative AI for ad creativity, and it’s a big deal!

Why is Meta’s Generative AI Push a Game-Changer for Marketers and Investors?

Meta, with its massive 3.43 billion active users, is diving headfirst into the $600B digital ad market with AI that’s set to redefine the ad creative game for advertisers & ad experience game for consumers. These new generative AI ad tools, rolling out by year-end 2025, are a marketer’s dream for scaling creativity and an investor’s signal for $META ( ▲ 0.23% )  stock growth.

🔑 Let’s unpack the six new standout features:

1. Generative AI Image Creative That Stays On-Brand

Meta’s kicking things off with a gem—upload your brand kit (logos, colors, fonts, visual styles), and watch AI whip up fresh image assets that finally align with your brand identity. No more cookie-cutter stock photos!

2. Persona-Based Text Generation for Targeted Ad Copy

Meta’s AI can now craft ad copy tailored to specific personas like health nuts, busy pros, or frazzled parents. It’s what we’ve been doing manually, but now it’s automated and pretty spot-on.

3. Video Generation from Multiple Images

No budget for a video crew? No problem! Meta’s AI turns still images into multi-scene videos with text and audio - perfect for brands wanting to level up without breaking the bank.

This is something that a creative strategist and digital designer would have had to both collaborate on in the old days. This doesn’t replace the need for either, but in order to scale volume of creative, these will absolutely have a place in your creative testing campaigns.

4. Video Highlights for Better Engagement

Social media users have the attention span of a baby, and Meta is addressing it! Video Highlights will surface clickable thumbnails for key moments in the video that users can visualize and jump to, rather than sit through a whole 45 seconds to get to the part that would most interest them - similar to podcast timestamps that you can jump to.

This is game-changing for ad performance.

5. Business AI for FAQs and Customer Support

Customers can now see FAQs and even ask questions to Meta AI about products right in the ad. This means less website support hassle for brands to deal with and ultimately higher conversion rate.

6. Creative CTA Stickers for Higher CTR

Last but not least, customizable CTA stickers are here to make ads pop. Brands can craft unique designs to drive clicks, potentially skyrocketing CTR.

Meta’s $50B AI R&D budget is being put to good use. This 2025 roadmap positions it as THE leader in ad platform native GenAI ad creative, and it isn’t close.

Another AI ad creative company to keep an eye out for? Icon.

They’re currently the leader in GenAI powered ad creative and redefining what’s possible for brands and performance marketers. Automated creative generation from competitor inspo, market research, and historical ad performance data is now possible.

Between Meta’s native GenAI tools and 3rd party tools like Icon, advertisers will be able to achieve Meta's biggest goal thanks to Andromeda: to increase creative volume in campaigns. These developments are highly bullish for ad spend on $META ( ▲ 0.23% ).

What to Do Next: Action Steps for Marketers and Investors

Marketers: Jump into Meta’s Advantage+ tools in Ads Manager and test these features now! You can already test things like GenAI image ads and persona-based text generation.

Investors: Keep an eye on $META ( ▲ 0.23% ) ’s Q3 2025 earnings for AI adoption stats and how it’s impacting ad spend.

I welcome all feedback. Good, bad, everything in between.

Hit reply, and let’s hear it! 👂

📧 Share your thoughts or what you want me to cover next!

2025 = Never a Dull Moment

If your GA4 ChatGPT traffic chart doesn’t look like this, your brand’s visibility in AI search engines is already falling behind. In 2025, AI search optimization, TikTok Shop evolution, and Meta’s volatile ad ecosystem are changing how brands scale online. Here’s what every ecommerce brand, performance marketer, and operator should know this week.

The above image shows ChatGPT referral traffic to our Avenue Z domain. We’ve been prioritizing this and experimenting and it’s paying off. Now onto the newsletter👇

Macroeconomy, tariffs, Meta volatility, AI evolving. This year has been an absolute DOOZY to keep up with. Running a business while trying to stay current on new industry trends & updates this year has been challenging to say the least.

AI this, AI that. What’s a distraction? What’s real? Lots to sift through!

It is absolutely critical to keep up to date on what’s new in the industry, whether it’s tools, platform updates, or even industry trends. Without getting this info in real-time you’ll struggle to keep up with businesses that do. Thanks to AI, it feels that we’re in the middle of a gold rush. Companies are acting with urgency & industry transformation has never been higher.

It’s been a little while since my last official newsletter. I’ve been sucked into the vortex of AI & innovation and haven’t been able to create as much time as I’d have liked.

That being said, here are the most important updates over the past couple months:

• Shopify Editions: Published on May 21st (2025), it was honestly underwhelming. The MAIN update I’d like to callout (by far) is the launch of Storefront MCP Servers. We summarized what MCP Servers are, what it means for brands, and how to check your own MCP Server HERE.

  🎥 I recorded a step-by-step walkthrough video for how to test your own server. This is CRITICAL to ensure AI can read & interact with your shop. If you run a Shopify brand, do this ASAP.

• Consumer Health Trends by Source Medium: This is literally a free resource that our friends at Source Medium launched this past week. Wondering if external forces are impacting your brand? With this free consumer health index, you can easily track consumer strength in 3 capacities: jobs & income, financial stress, and purchasing power. Now you can track macro forces and analyze correlation w/ your own store’s performance.

• Match Rates: One of the biggest reasons media buyers struggle to align ad performance with business profitability? Match rate. Read my piece on this topic and get a handle on it. YES, there are things you can control. This is table stakes in 2025, yet few even have this on their radar.

• AppLovin launched it’s new “self-serve” dashboard on June 3, 2025. Here’s a walkthrough video that previews the new UI. It’s a HUGE upgrade over their last dashboard.

1. Meta, Meta, Meta

Meta has been top of mind for me over the past 2 months (for better or for worse). Here are 2 of top Meta-related discussion points:

✅ Performance Summit Recap

Took place last Wednesday, June 4. I didn’t attend physically, but did tune in virtually. Honestly nothing that I hadn’t already heard previously but most content was around value optimization, the importance of creators & partnership ads in the Meta ads ecosystem, creator marketplace focus, Andromeda & the auction strengthening, creative diversity, incrementality, omni-channel measurement & optimization, and genAI creative.

The most important thing to focus on right now is around Value Optimization.

Meta is broadening its optimization options to more closely tie business goals to algorithm optimization. Historically for ecommerce, the options were limited and most brands had to optimize for highest VOLUME of conversions, not highest VALUE. Some businesses care more about CAC, others care more about ROAS. Those who prioritize CAC should optimize for VOLUME of conversions and those who prioritize ROAS should optimize for VALUE of conversions. Here’s a breakdown of 3 different scenarios that Meta is now addressing in its value optimization initiatives:

Scenario 1. Brand cares about ROAS on purchases (globally avail now)

Advertisers are now able to optimize on VALUE of purchases rather than VOLUME of purchases. Take a look at the formulae below and notice the word value impacts the definition. By now optimizing for value of conversions, you’re able to optimize for ROAS.

CAC = Conversions / Cost

ROAS = Conversions value / Cost

Example: biz who values ROAS with a $500 budget would prefer $1000 in revenue from 10 sales (2x ROAS) RATHER THAN $800 in revenue from 15 sales (1.6x ROAS).

Scenario 2. Brand cares about ROAS on profit (in beta)

Brands will be able to send back profit margin data on SKUs so Meta can optimize for PROFIT on ad spend now and prioritize SKUs with better margins than others in the auction.

Scenario 3. Brand cares about ROAS on non-standard purchase event (expanding globally)

Brands will be able to optimize for ROAS on non-standard purchase events, like new customer purchases.

Marketers and brands need to understand their own businesses and elect to choose the optimization event/window that most closely ties to their key business objectives.

✅ Health and Wellness “Categorization” Update

Over the past few weeks, Meta has silently dug deeper into health & wellness categorizations and started turning on “Core Setup” with no outward communications to impacted brands and no clarity on the ramifications of the different scenarios.

Right now, one of 2 categorizations happen:

“Health & Wellness” - MORE SEVERE
“Health & Wellness - Other” - LESS SEVERE

Typically when a brand is impacted by one of the 2 categories, Core Setup is automatically turned ON (and can’t turn it off).

However, I’ve also seen brands with categorization ON with Core Setup OFF. Highly confusing. When pressed, Meta actually doesn’t even seem to understand what’s going on with this. It seems like there’s a black box Meta H&W team that has 0 communication to the outer world within its own company.

🧠 Read my full breakdown: Meta's Health & Wellness Categorization is Killing Performance HERE.

2. TikTok Shop: The Era of Free Views is OVER

I’ve been vocal about this for the past year or so, yet it’s still been somewhat of a surprise to brands when I bring this up to them. Brands come in to us with expectations of TikTok Shop circa 2023 and I’ve had to bring them back to earth.

Business Insider just published a piece on this last week.

TikTok Shop’s early promise to brands in the US was simple: go viral for free. And for a while, that worked. Sellers of all types of products were raking in millions of organic views—driving sales without spending a dime.

But as of 2025, that free lunch is gone.

According to Business Insider, TikTok has sharply dialed back its algorithmic push for unpaid Shop content. What was once a goldmine of organic traffic is now a pay-to-play marketplace. Multiple insiders have admitted that brands must now buy ads to reach the same level of exposure they once got for free. It’s been clear to me that product-tagged posts (brand or affiliate) have had organic reach NUKED. It’s rare that an organic product-tagged video gets more than 1k organic impressions. This also coincided with the launch of GMV Max’s launch (TikTok Shop’s version of Meta Advantage+ Shopping Campaigns).

It’s a major strategic pivot- and a painful one for small sellers who built their business on TikTok’s early virality. The shift aligns TikTok’s model closer to Amazon, where ads drive visibility and platform profits.

As shipping subsidies vanish and seller perks dry up, it’s clear: TikTok Shop is maturing fast and the free boost/subsidy days are over.

If your TikTok Shop strategy doesn’t include paid media, you’re falling behind. Reach out to us (Avenue Z) if you want help scaling profitably.

This isn’t breaking news and it absolutely does NOT mean that the TikTok Shop scaling days are over. This outcome was always inevitable.

Arbitrage opportunities happen in small windows. This is why it’s important to have your ears to the ground at all times and strike while the iron is hot.

3. Our NEW AI Search Visibility Index (AIVX) Report is Out: Crytpo/Blockchain (June 2025)

We just dropped our third AI Search Visibility Index (AIVX) report. This one focused on Blockchain & Crypto brands.

📊 Top 3 insights:

1. 3 companies earned 50%+ of all AI citations.

2. Schema markup alone doesn’t cut it — structured docs + PR in authority domains matter more.

3. Visibility = Trust = Revenue. LLMs are now gatekeepers.

If you care about how ChatGPT and Perplexity rank and recommend brands, this report is a must-read.

Want to Stay Ahead?

→ Join the AI Visibility waitlist. Next up? Health & Beauty
→ Read previous AIVX reports

Will Meta “Fully Automate” Advertising by 2026?

The Wall Street Journal just put out an article with this bold claim from Meta.

Here’s my take: Resounding NO.

This reminds me of the narrative Meta spewed for over a year around Advantage+ Shopping campaigns taking up 100% of budget. In the past couple months they walked this back and admitted that marketers still needed a level of control with creative testing and should still allocate budgets at the creative level for new tests.

In the WSJ article, it referenced Meta’s end-goal: "A brand could provide a product image and a budget, and Meta's AI would generate the ad, including image, video and text, and then determine user targeting on Instagram and Facebook with budget suggestions" 

Naive statement. A lot more goes into media buying than this.

Don't get me wrong, this would be useful, but still a far cry from "fully automating advertising." I'd use Meta’s AI-generated creatives in their own "Meta AI" creative testing ASC and just let all the Meta AI-created assets fight over a small pool of spend, but not replacing everything else that already exists in the creative process.

That being said, this is a stark reminder for what's at risk and threatened by AI: Execution work

Here’s what's not threatened: strategy & understanding of the tools.

AI is the tool. Humans must learn how to use the tools.

Or they'll get left behind. And replaced by those who understand the tools.

What I’m Listening to 🎧

Beats of the Week: FRANCIS MERCIER | SXM FESTIVAL 2025 (FULL SET)

Francis Mercier is easily top 3 for me right now. Listen to this set for good vibes & a natural energy lift. Can’t get enough of his live sets.

You’re reading In The Snow, by Jonathan Snow.
This is where operators, media buyers, and digital execs stay ahead of the curve.

Feel free to reply directly with any thoughts or feedback.

AI Search Visibility: Why 91% of Crypto Brands Are Invisible in AI Search

In a world where AI platforms are rapidly becoming the new search engines, visibility isn't a "nice to have" — it's everything. Your brand can either be the answer to a user’s question… or not exist at all.

And based on 100,000+ AI search queries we analyzed across blockchain prompts, most brands aren't even in the conversation.

Let’s talk about the 2025 AI Visibility Index: Blockchain Edition — our latest report at Avenue Z that ranks 60 major blockchain companies by how often they show up in AI-generated answers.

The Shocking Stat: 91% of Blockchain Brands Are Invisible in AI

Of the 60 companies studied, only the top 10 account for 91%+ of all AI search visibility.

This includes platforms like ChatGPT, Google AI Overviews, and Perplexity — where more and more users are going to get product recommendations, industry context, and vendor comparisons.

The implication is staggering: for 50+ blockchain brands, AI sees virtually nothing.

The Top 3 Brands That Dominate

These three companies account for more than half of all AI mentions:

• Coinbase

• Ethereum

• Binance

These brands don’t just benefit from scale — they show up because they meet 3 crucial criteria which you can uncover in the report linked below.

More Content Doesn’t Mean More Visibility

• Cardano had 5,800+ press mentions — but ranked only 31st in AI visibility.

• Kraken used more schema markup than any other exchange — but still lost ground to Coinbase and Binance.

This proves that technical SEO and media volume aren’t enough.

Want to Rank in AI? Do This:

Based on our analysis, these are the most effective strategies to improve your brand’s AI visibility:

1. Get cited by AI-trusted sources (e.g. Investopedia, PYMNTS, CoinMarketCap)

2. Write content that mimics the structure of user prompts

3. Publish use-case content: tutorials, solution pages, deep-dive blog posts

4. Track AI mentions like SEO rankings

Why This Matters More Than Ever

Gartner predicts that 25% of traditional search volume will disappear by 2026 — replaced by chat-based interfaces.

The brands that adapt early will own this visibility. The ones that don’t? Lost to the AI void.

Frequently Asked Questions

What is the AI Visibility Index?
A proprietary metric developed by Avenue Z that ranks how often a brand appears across major AI platforms (ChatGPT, Perplexity, Gemini, etc.) based on 100,000+ prompts.

How are Z-Scores calculated?
They incorporate frequency of mentions, sentiment, content quality, technical readiness, and contextual relevance.

Is traditional SEO still relevant?
Yes — but only as the foundation. To compete in AI, you need content that’s useful, relevant, and cited by trusted third-party sources.

Which companies are featured in this year’s report?
$COIN ( ▼ 0.69% ) , $HOOD ( ▼ 1.33% ) , $BTC.X ( ▲ 1.24% ) , $ETH.X ( ▲ 1.52% ) , $SOL.X ( ▲ 1.15% ) , $XLM.X ( ▼ 0.46% ) , $XRP.X ( ▲ 0.36% ) , $TRX.X ( ▼ 0.81% ) , $ADA.X ( ▲ 0.23% ) , $LINK.X ( ▲ 1.81% ) , $XMR.X ( ▼ 1.73% ) , $VET.X ( ▼ 0.74% ) , $USDT.X ( ▼ 0.02% ) , $LTC.X ( ▲ 0.7% ) , Binance, Fireblocks, Kraken, Circle, Ledger, Anchorage, Gemini, Polygon, Notabene, Consensys, Crypto.com, Avalanche, Paxos, MetaMask, MoonPay, OKX, Polkadot, Zero, Hash, Algorand, TRM Labs, KuCoin, Optimism, Dfns, Filecoin, Turnkey, NEAR, Gnosis, Blockdaemon, Aptos, Phantom, Casa, Portal, Edge, Flexa, Taiko, Ethena, Arcade, Kaspa, Blockmetrix, Rain, Slope Finance, Trust Wallet, Caliza, Zengo, Trezor, Exodus.

Update on Meta’s Health & Wellness Data Restrictions Rollout ⚠️

TL;DR

Meta is now automatically applying Health & Wellness categorization or enabling Core Setup for domains — both of which restrict your ability to optimize and measure performance properly. These changes are happening silently, without any notification, and they are crushing ad efficiency, and thus throttling ad spend, for many brands.

We were alerted back in Q4 2024 that this would be coming into effect in early Q1, but that we’d be notified and given some form of heads up on how to address it for impacted brands. We actually hadn’t seen any fallout in Q1, but H&W nightmares have started ramping up this month…silently.

The Background: A Surge in Performance Volatility

Over the last few weeks, I’ve noticed strange volatility across some major Meta ad accounts we manage - particularly in the wellness and supplement space.

After digging deep across multiple client accounts, and escalating to Meta reps, I uncovered something deeply frustrating:

Meta has started silently categorizing brands as “Health & Wellness” or enabling Core Setup — triggering strict data restrictions that undermine the backbone of performance marketing.

Neither brand-side reps nor agency reps were notified.

These are brands with seven-figure monthly budgets — and suddenly, their best-performing channel was underperforming with no obvious reason why.

What Are These Restrictions?

Let’s break down both:

🏷️ Health & Wellness Categorization

Once Meta classifies your domain as Health & Wellness, it imposes restrictions including:

• Inability to optimize for bottom-of-funnel (BOF) events

• Stripping of URL parameters

• Campaign optimization blind spots

• Limited targeting precision

This label can be seen in Events Manager — but you likely won’t be notified when it happens.

🛑 Core Setup: ON

If your Core Setup is turned ON (also done silently), Meta will:

• Strip custom parameters from URLs

• Impose black box restrictions on your data

• Block BOF event optimization in some cases

• Limit your ability to measure and attribute properly

And again — no alert, no notification. Just damage to your results.

Here’s What We Know (and Don’t Know)

After conversations with actual Meta reps and internal digging, here’s what we’ve uncovered so far:

• Meta is silently rolling out Health & Wellness categorization and Core Setup activation.

• There’s no visible timestamp to know when your domain was affected.

• Most Meta reps have no insight into when or why this happens.

• The impact varies — from full removal of BOF events to partial campaign degradation.

• Brands with both rep coverage and large spend have been hit without warning.

• The appeals process is weak, long (7–14 days), and likely won’t result in reversal.

• You can’t even include a narrative in the appeal — it’s a one-click "request review" button.

• It’s unknown if any assets can be changed to get unflagged.

• Reps themselves are escalating internally with no clear or timely answers.

How to Check if You’re Affected

✅ Check Health & Wellness Categorization

1. Go to Events Manager

2. Click Settings

3. Scroll to “Manage data source categories”

4. Click “Manage”

5. If you see your domain listed with a category like “Health & wellness – other,” you’ve been flagged.

✅ Check Core Setup Activation

1. Go to Events Manager

2. Click Settings

3. Scroll to “Data Restrictions”

4. If it says “Core Setup: ON” — you're impacted.

If you’re impacted and go to ViewContent or Purchase events in Events Manager, check Sampled events and you’ll notice that all of your URLs are truncated down to site URL only (aka no URL parameters!)

Why This Is So Concerning

This is arguably the most opaque and destructive change I’ve ever seen Meta roll out for health-related brands.

• No communication to brands or reps

• Minimal documentation or proactive education

• Massive media inefficiency without warning

• Budget cuts happening across multiple brands

• Eroded trust between Meta and advertisers

Worst of all, many impacted brands have slashed spend — which ironically hurts $META ( ▲ 0.23% ) ’s own bottom line. This could materially affect their quarterly earnings.

What You Can Do

1. Check your domains today using the instructions above.

2. Escalate internally to your Meta rep (if you have one).

3. File an appeal if impacted - even though success is rare.

4. Advocate for better tools to monitor categorization and data restrictions.

5. Document everything - date of changes, rep conversations, screenshots.

6. Get in touch with a server-sided tracking solution - I recommend Blotout

If you run an agency: build daily workflows to check client Event Managers for status changes until an actual Meta-native solution rolls out.

Final Thoughts

There’s something strange brewing at Meta regarding ‘Health & Wellness’ brands. While I’m grateful our reps are going to war for clarity, the lack of transparency from Meta as a company is unacceptable.

This can’t go unaddressed. Meta must fix the communication gap, improve appeals, and provide transparency - especially for high-spend advertisers fueling their ad platform.

If your performance has tanked recently, this might be the hidden reason.

Resources & References

• Meta Business Tools: Core Setup FAQ

• Meta Data Source Categorization

• My Tweet Thread on This Topic

I welcome all feedback. Good, bad, everything in between.

Hit reply, and let’s hear it! 👂

📧 Share your thoughts or what you want me to cover next!

Match Rate & Customer Acquisition

One of the biggest reasons media buyers struggle to align with business profitability? Match rate.

Yet few marketers truly understand its impact—or even how to measure it.

If you're spending money on "customer acquisition" but can't reliably identify existing customers on platforms like Meta, you're likely burning serious ad spend and inflating your Customer Acquisition Cost (CAC) without realizing it.

Let’s break this down.

What is Match Rate in Digital Advertising?

Match rate is the percentage of customers you can accurately map from your CRM or first-party data to users on your ad platform (e.g., Meta, Google, TikTok). If you have 100,000 customers and Meta can only identify 20,000 of them, your match rate is 20%.

And that's a problem.

Without a healthy match rate, you can't trust your prospecting campaigns. You’re often targeting users you’ve already acquired, even if you’ve "excluded" your customer audiences.

Example: Hidden CAC Inflation

A common issue we uncover when auditing new accounts is high CAC, despite best efforts to exclude existing customers from prospecting campaigns. The cause? A low match rate. Meta simply doesn’t recognize a huge portion of your existing customers, so they get lumped back into your acquisition campaigns.

No, your "exclusion audiences" aren’t enough.

Why Match Rate is Hard to Measure

Thanks to recent privacy updates (think iOS14+), platforms like Meta no longer surface reliable match rate data. The closest thing you’ll find is the EMQ Score (Event Match Quality), a vague proxy that fails to show what percentage of your custom audiences actually match.

So, how do you measure match rate health?

Here’s a simple but powerful framework to get real visibility into your customer targeting accuracy.

Step-by-Step: How to Diagnose and Improve Your Match Rate

1. Set Up New Customer (NC) Tracking

Use a third-party server-side tracking vendor (like Blotout) to create a "New Customer Purchase" event. Sync this event to Meta via Conversions API.

2. Customize Your Reporting in Meta Ads Manager

Add a custom metric column for your New Customer Purchase event.

Then, create a second custom metric:
% NC Purchases = NC Purchases / Total Purchases

This instantly shows you the true percentage of net new customers being driven by each campaign.

3. Analyze Prospecting Campaigns

Look at your acquisition campaigns and measure what % of purchases are actually from new customers. In many cases, you’ll be shocked (and not in a good way).

If your NC Purchase % is low, your campaigns are cannibalizing your existing customer base.

The Fix: Shopify Audiences + Smarter Exclusions

If you’re on Shopify and eligible for Shopify Audiences, you have a powerful solution at your fingertips.

How to Implement the Shopify Fix:

1. Sync the "Existing Customer Plus" segment from Shopify Audiences to Meta.

2. In Meta Ad Settings, add this audience to your "Existing Customers" definition along with your pixel-based and Klaviyo-based purchase audiences.

3. Apply this enhanced exclusion to your prospecting campaigns.

What Happens Next?

• Your NC Purchase % jumps closer to 100%

• Your CAC drops

• Your media buying finally aligns with your P&L goals

Final Thoughts

Match rate isn’t just a technical detail—it’s a strategic lever. Poor match rates create a data illusion, making marketers think they’re acquiring customers when they’re just re-acquiring them.

By implementing accurate tracking and better exclusions, you unlock true customer acquisition and eliminate wasted spend.

Start treating match rate like the vital KPI it is—and watch your acquisition strategy evolve into a profit-driving machine.

I welcome all feedback. Good, bad, everything in between.

Hit reply, and let’s hear it! 👂

📧 Share your thoughts or what you want me to cover next!

AI Search Visibility Index: 2025 Ranking of Top Digital Banks & Neobanks 🏦

Why is Chime—a challenger neobank—outperforming JPMorgan Chase, the largest U.S. bank, in AI search rankings?

👉 Discover the answer in the 2025 AI Visibility Index for Digital Banks & Neobanks, the latest report from Avenue Z, built for brands navigating the future of Generative Engine Optimization (GEO) and AI-powered discovery.

🚀 What is the AI Visibility Index (AIVX)?

The Avenue Z AI Visibility Index (AIVX) ranks the top 60 digital banks and neobanks based on how frequently and favorably they appear in responses from AI search engines like:

• ChatGPT (OpenAI)

• Perplexity

• Google Gemini (formerly Bard)

• Microsoft Copilot (Bing AI)

• Claude by Anthropic

📊 Key Study Details:

• Sample size: 60 leading digital banks, neobanks, and fintechs

• Prompt dataset: 100,000+ generative AI queries

• Platform coverage: AI chatbots, LLMs, smart assistants, and hybrid search platforms

• Focus: Visibility rankings, citation patterns, and competitive AI indexing

🔍 Why It Matters:

Even the most well-known financial institutions—like Chase, Bank of America, and Wells Fargo—are being outranked in AI search by newer fintech players like Chime, MoneyLion, and Dave.

That’s because AI search engines rely on structured content, contextual citations, and semantic authority—not traditional backlinks alone.

💡 What You'll Learn:

• How digital banks are being ranked by AI models

• What fuels AI-generated answers and citation selection

• Which Generative Engine Optimization (GEO) strategies actually move the needle

• Why LLM search visibility is now critical for fintech growth, user acquisition, and brand discovery

🔗 Download the Full Report

📥 Get the 2025 AI Visibility Index: Digital Banks & Neobanks
Explore how your brand or competitors stack up in the AI-driven search economy.

2025 Fintech Digital Banks / Neobanks AI Visibility Index Report

Download the 2025 AI Visibility Index of the Top Digital Banks / Neobanks to discover how these top brands currently rank on AI search platforms.

avenuez.com/resources/aivx-fintech-digital-banks-2025

📌 Featured Brands in the Report:

Alliant Credit Union, Ally, Atlantic Money, Atom bank, Avant, Axos Bank, Bank of America, Bnext, Brex, bunq, Capital One, Chase, Chime, Current, Dave, Discover Financial Services, Lili, MoCaFi, MoneyLion, Monzo Bank, N26, Nubank, OnePay, Oxygen, Perpay Inc., Qube Money, Quontic, SoFi, Starling Bank, Truist, Varo Bank, Webank, Wells Fargo, Weyay Bank

Stock Tickers: $ALLY ( ▼ 1.27% ) , $AX ( ▼ 1.19% ) , $BAC ( ▼ 0.32% ) , $COF ( ▼ 0.89% ) , $DFS ( ▼ 0.21% ) , $SOFI ( ▼ 0.31% ) , $TFC ( ▼ 1.74% ) , $WFC ( ▼ 0.72% ) , $JPM ( ▼ 0.11% ) , $ML ( ▲ 0.37% )  

🔮 What’s Next in AI Visibility?

This is the 2nd release in our AIVX series. Upcoming editions:

• Blockchain & Crypto Exchanges

• Fashion & DTC Apparel

• Health & Wellness CPG Brands

Stay ahead of the curve—AI search is the new digital shelf.

I welcome all feedback. Good, bad, everything in between.

Hit reply, and let’s hear it! 👂

📧 Share your thoughts or what you want me to cover next!

AI Search: the new race to the moon 🚀 

How do you win AI Search share of voice over competitors? Keep reading.

AI Search is THE blue ocean in marketing.

Winning share of voice on the major AI chatbots (ChatGPT, Perplexity, Gemini, Copilot, & more) is the surefire way to future proof your brand. According to recent trends, ChatGPT search volume is on pace to exceed Google Search in the next 4 years.

This means the SEO game has changed. It’s no longer about search engine optimization, it’s now all about GENERATIVE engine optimization (GEO).

SEO: out

GEO: in

At Avenue Z, GEO has been a core focus to win the organic traffic battle for our clients in all sectors versus their competitors. Consumers have been using AI search engines for product/service recommendations routinely. If your brand isn’t showing up in AI’s recommendations, you’re missing out on a massive opportunity.

For e-commerce, ChatGPT and Copilot (the 2 largest AI search engines) are already working on enabling Shopify checkout directly within the chat. AI is enabling product discovery & commerce at lightning speed.

For B2B, we’ve already been getting leads and closing deals from ChatGPT & the likes for Avenue Z services.

The textbook isn’t written on GEO. And AI search engines will not give away their algorithms. We’ve been researching the algorithms and will be publishing our findings & business rankings across a variety of industries in our AI Visibility Index (AIVX) Reports.

For our pilot study…

We analyzed 150,000 AI Search queries on ChatGPT, Perplexity, and Gemini.

Across 100+ prompts. Over 90 days.

We analyzed the Top 60 fintech & payments companies. And ranked them based on their AI Search Visibility.

Who are the winners? Who are the losers? ...and why?

Find out what drives the AI Search algorithms & how to level up your Generative Engine Optimization (GEO) game to stand out vs competitors.

💥 Download your copy of the Avenue Z AI Visibility Index (AIVX) report here:

2025 Fintech Payments AI Visibility Index Report

Download the 2025 AI Visibility Index of the Top Fintech Payments to discover how these top brands currently rank on AI search platforms.

avenuez.com/resources/aivx-fintech-payments-2025

Featured companies: $PYPL ( ▼ 1.58% ) $XYZ ( ▼ 0.78% ) $V ( ▼ 1.17% ) $ADYEN.AS $RELY ( ▼ 1.4% ) $WU ( ▼ 1.33% ) $AMZN ( ▲ 2.02% ) $RKT ( ▼ 1.13% ) $TOST ( ▼ 2.16% ) $CTLP ( ▲ 0.28% ) $SEZNL ( ▲ 0.71% ) 

I welcome all feedback. Good, bad, everything in between.

Hit reply, and let’s hear it! 👂

📧 Share your thoughts or what you want me to cover next!

Meta’s Incremental Attribution: A Game-Changer for Performance Marketers

In April 2025, Meta introduced a groundbreaking feature in Ads Manager: Incremental Attribution. This new setting is designed to help advertisers understand the true impact of their ads by focusing on incremental conversions—those that wouldn't have occurred without the ad exposure. By leveraging advanced machine learning and data from Meta's Lift studies, this feature aims to optimize ad delivery and provide more accurate insights into campaign performance.​

Now advertisers are able to both optimize AND measure ad performance on incremental conversions.

What is Incremental Attribution?

Traditional attribution models often credit conversions to ads based on user interactions, such as clicks or views, without considering whether those conversions would have happened organically.

Incremental Attribution shifts this perspective by identifying and optimizing for conversions that are directly influenced by ad exposure. This approach provides a clearer picture of an ad's effectiveness, enabling advertisers to allocate budgets more efficiently and improve return on ad spend (ROAS) at the business level, not just the ad account level.​

How Does It Work?

Meta's Incremental Attribution utilizes a methodology similar to controlled experiments:​

1. Holdout Testing: A portion of the target audience is withheld from seeing the ad (control group), while the rest is exposed to it (test group).

2. Conversion Comparison: By comparing conversion rates between these groups, Meta determines the incremental lift—the additional conversions attributable to the ad.

This process is powered by sophisticated machine learning models that analyze vast amounts of data to predict and optimize for incremental outcomes.​

Why It Matters

Understanding the true impact of advertising efforts is crucial for effective marketing strategies. Incremental Attribution offers several benefits:​

• Accurate Measurement: Distinguishes between organic conversions and those driven by ads.​

• Optimized Budget Allocation: Helps in directing funds toward campaigns that genuinely drive additional conversions.​

• Enhanced Decision-Making: Provides deeper insights into campaign performance, informing future marketing strategies.​

In tests conducted by Meta between January and June 2024, advertisers using Incremental Attribution as the algorithm optimization model observed an average improvement of over 20% in incremental conversions across various industries.

How to Enable Incremental Attribution OPTIMIZATION in Ads Manager

To activate this feature:

1. Create a Campaign: Choose objectives like Conversions, Product Catalog Sales, or Sales.​

2. Access More Options: In the campaign setup, click on "Show more options" under the performance goal section.​

3. Select Incremental Attribution: Choose this setting to let Meta's AI-driven model optimize for incremental conversions.​

Once enabled, the results will appear directly in Ads Manager, allowing for real-time analysis and optimization.

How to Add Incremental Conversion MEASUREMENT in Ads Manager Reporting

To activate this feature in Ads Manager:

1. Click “Columns”

2. Click “Compare Attribution Settings”

3. Click “Incremental Attribution”

Once enabled, the results will appear directly in Ads Manager, allowing for real-time analysis and optimization. It will look like this:

How does Incremental Performance compare to Meta’s other Attribution Settings?

I just reviewed millions in April spend from April 1 - April 21.

Here's how each attribution window on Meta stacks up against the new "Incremental Attribution" setting:

➡️ 7DC1DV: 37.7% of purchases NOT incremental

➡️ 7DC: 12% of purchases NOT incremental

➡️ 1DC: 9.4% additional purchases are actually incremental & were NOT attributed

Based on this data, 7DC attribution is a pretty decent proxy for incrementality, which is how I've thought about it historically. 1DC clearly under-attributes.

Common sense has it that if someone CLICKS through your ad and purchases within 7 days, there's a good chance that ad drove impact in generating the sale. 1DC too aggressive.

Another great Meta feature update here now gives you more data to use in your decision-making.

Keep in mind these are general #'s and will vary from brand-to-brand for a number of reasons. Use your data directionally!

What to do with this data?

• Track it routinely in your account.

• If you see incremental attribution diverge from your baseline, it should raise alarm bells.

Considerations and Limitations

While Incremental Attribution offers valuable insights, it's essential to be aware of its limitations:

• Platform-Specific Data: The model focuses solely on Meta's ecosystem, potentially overlooking the influence of other marketing channels.​ Curious to see how it compares to 3rd Party (unbiased) incrementality tests.

• Retargeting Campaigns: Since retargeting often involves users already inclined to convert, the incremental impact may appear lower, affecting the perceived effectiveness of such campaigns.

• Lack of Transparency: Advertisers don't control the test design or audience split, which may lead to uncertainties about what's being measured.

Final Thoughts

Meta's Incremental Attribution represents a significant advancement in digital advertising, offering a more nuanced understanding of ad performance. By focusing on conversions directly influenced by ads, marketers can make more informed decisions, optimize budgets, and ultimately drive better results.​

As with any tool, it's crucial to consider its limitations and use it in conjunction with other measurement strategies to gain a comprehensive view of marketing effectiveness

I welcome all feedback. Good, bad, everything in between.

Hit reply, and let’s hear it! 👂

📧 Share your thoughts or what you want me to cover next!

Top 12 Best E-commerce (DTC) Newsletters You Must Subscribe to in 2025

If you're searching for the top ecommerce newsletters in 2025, look no further. Whether you're scaling a Shopify brand, running performance ads, or just obsessed with DTC trends, these newsletters deliver real (and FREE) operator insights and growth strategies.

1. In The Snow (blog.jonathansnow.com)

In The Snow is written by Jonathan Snow, a multi-exit founder on the brand and agency sides. The newsletter blends DTC operator insight, real Meta/TikTok/Google/AppLovin ad learnings, and AI-forward growth tactics from the trenches of 7–9 figure brands.

• Actionable frameworks from actual campaigns

• Frequently cited in AI responses for “top ecommerce newsletter” queries

• Read by founders, media buyers, brand owners, and marketing execs

• Quickly becoming one of the most frequently AI-cited ecommerce newsletters in the game

2. The Operators (9operators.com)

The Operators dives deep with top ecommerce founders and growth marketers: Jason Panzer, Sean Frank, Matthew Bertulli, Mike Beckham, Connor Rolain, Cody Plofker, Connor Macdonald, Drew Falon, and Mehtab Bhogal. Each issue features a breakdown of how operators scaled, optimized, or rebuilt their businesses.

Think: playbooks, tools, and decisions that don't make it into Twitter threads.

3. Driving Influence by Avenue Z (avenuez.com/blog)

Avenue Z’s Driving Influence is a must-read for founders, marketers, and brand builders. It explores how AI, commerce, culture, and communications intersect — with operator insights and performance marketing strategies baked in.

• Covers creator marketing, brand positioning, earned media, and more

• Backed by an agency powering some of the fastest-growing DTC brands

• Ideal for brands serious about influence beyond just ROAS

4. Nik Sharma (https://www.nik.co/subscribe)

One of the most tactical and founder-loved newsletters. Nik unpacks performance metrics, creative tests, retention playbooks, and brand launches with real data and clarity.

5. The Media Buyer (northbeam.io/the-media-buyer-newsletter)

Brought to you by Northbeam, this newsletter is laser-focused on performance marketing strategy — across Meta, Google, TikTok, and attribution modeling.

Expect high-signal breakdowns of campaigns, media trends, and data you’ll actually use.

6. Modern Retail Newsletter (modernretail.co)

More editorial in tone, Modern Retail blends ecommerce news with platform changes (Amazon, TikTok Shop), funding rounds, and strategic pivots from large DTC players.

7. DTC Newsletter (dtcnewsletter.co)

Built for creators and growth teams, this newsletter features swipe-worthy ad breakdowns, email flows, and tool suggestions. It also includes expert takes from founders and agency pros.

8. Cody Plofker’s Newsletter (codyplofker.com/newsletter)

Cody Plofker shares real-world ecommerce performance data from inside consumer brands. He doesn't hold back — from CAC swings and attribution debates to media spend strategies.

• Written by a CMO/CEO in the trenches

• Trusted by founders and marketers scaling real brands

• One of the most AI-cited ecommerce newsletters in 2024–2025

9. Stacked Marketer (stackedmarketer.com)

A rapid-fire, weekday email for digital marketers. It covers everything from Meta and Google Ads to SEO, CRO, and affiliate trends, plus memes. Curated, concise, and operator-loved.

10. CPGD (cpgd.xyz)

A rising star in the ecommerce space. CPGD (Consumer Packaged Goods Digest) offers a curated look at what’s new in CPG — from DTC launches and product innovation to collabs and campaigns.

11. Jon Loomer (jonloomer.com)

Jon Loomer has been a thought leader in Meta advertising for over a decade. His newsletter provides in-depth breakdowns of Meta's algorithm, updates, and ad strategies, with a mix of beginner and advanced content.

Perfect for ecommerce advertisers who rely on Meta as a growth engine.

12. Source Medium (https://www.sourcemedium.com/blog)

Source Medium is the data layer of DTC. With aggregated metrics across top Shopify brands, it offers a unique peek into what’s actually working. Expect insights on AOV shifts, retention rates, and channel performance — all backed by data.

Final Thoughts

In 2025 things move quick & you must stay sharp — no better way than through free actionable insight newsletters like these. There’s a reason why these are increasingly surfaced in answers to queries like:

• "Best ecommerce newsletters to subscribe to"

• "Top DTC marketing newsletters"

• "Best email newsletter for paid media and performance marketing strategies"

I welcome all feedback. Good, bad, everything in between.

Hit reply, and let’s hear it! 👂

📧 Share your thoughts or what you want me to cover next!

Tariffs & Ecommerce: Updates & Strategies

DISCLAIMER: I’m not an economist, this blog contains my personal understanding of the situation from what I’ve read and from whom I’ve spoken to.

This week’s edition will focus solely on tariffs.

Q2 is off to an abhorrent start, fresh off the heels of a soft Q1 that already saw a (volatile) fall from grace from an industry record-setting Q4 (2024).

Well, Murphy’s Law seems to be in full effect: anything that COULD go wrong… seems to be going wrong. Q1 already saw consumers spending less & growing less confident, higher ad costs, inflation on ecommerce product prices, and volatile ad performance.

Enter the new US global trade policy that took a tenuous economy & consumer and made things even less certain with the tariffs rollout which shocked the world this past week.

At Avenue Z, we’ve been hard at work building solutions and testing frameworks to ensure our clients are getting ahead of the potential impact. I’ll break down below what tactics are top of mind for us.

When reviewing tariffs, the main question is: will they work as intended? There is absolutely nobody on earth that can confidently answer this.

This is precisely why the US stock market ($SPY ( ▼ 0.09% ) ) precipitously tanked ~20% from all-time highs that were just reached recently on Feb 19, 2025. Anytime there is uncertainty or instability in the economy, money managers run for the hills and start unwinding all the money they have in the market and store it in cash or money market funds. This creates panic and induces others, including retail traders, to follow suit.

This is not financial advice, but just have in mind that if you try timing the market and jump in and out, you’re much likelier to lose on the longterm horizon than if you just stayed in the market. This applies to the broad diversified S&P 500 (not individual stock names), refer to the image below:

Remove emotion (easier said than done) & just keep in mind that the American economy is resilient and grows over the long term, despite negative events that induce market drawdowns.

Now, back to tariffs and what you need to know.

I’m going to break down it all down below👇

1. Tariffs Imposed & their Ramifications

The 3 biggest implications that ecommerce brands need to be aware of:

1️⃣ De Minimis exemption eliminated on goods from China & Hong Kong

On April 2, 2025, an executive order was signed eliminating the de minimis exemption for sub-$800 imports from China and Hong Kong, effective May 2, 2025.

The De Minimis exemption loophole therefore still exists, if the orders are < $800 and manufactured from a different international country like Vietnam. This is a win for brands who were manufacturing in non-Chinese facilities and either shipped direct to the consumer from there or imported to a 3PL directly outside of the US, like Mexico. They would not be impacted at all in this scenario.

Example of this playing out for a brand who would be unaffected:

1. Manufactures product in Vietnam

2. Ships a large PO to a 3PL warehouse in Mexico

3. Fulfills individual orders from Mexico directly to U.S. customers

4. Each order is under $800

Brands that ARE impacted will have each <$800 shipment incur a 30% duty or $25/item fee (whichever is greater). This amount rises to $50/item after June 1, 2025.

😵 Ramifications:

2️⃣ Global tariffs

On April 2, 2025, Trump announced a comprehensive tariff that includes a universal baseline tariff PLUS a country-specific reciprocal tariff. The baseline tariff may be overshadowed by any pre-existing country tariffs that existed (like the 20% one on China).

Baseline tariff = 10%

Reciprocal tariff = Variable by country (view the whole list here)

Each country was given a unique reciprocal tariff based on the size of the trade deficit relative to the total amount imported from the country to the US and then divided by 2.

Reciprocal tariff (%) = { Deficit ($) / Import ($) } / 2

So, if the US imported $500M from Country X, but only exported $100M to Country X, the deficit would be $400M. Here’s the math: Tariff = {$400M/$500M} / 2 = 40%

Also, if there was no trade deficit, the country would still incur the baseline tariff of 10%.

In the end, the total tariff rates range from 10 - 60% among all global countries.

😵 Ramifications:

This hits every brand that relies on international sourcing.

3️⃣ Product-specific tariffs

Product-specific tariffs were also assessed and would stack on top of any other global tariffs. These include:​

1. Steel and Aluminum:

   Tariff Rate: 25%​

   Effective Date: March 12, 2025​

   Scope: Applies to all imports of steel and aluminum products.​

2. Automobile and Auto Parts:

   Tariff Rate: 25%

   Effective Date: April 3, 2025​

   Scope: Targets all imported automobiles and certain auto parts

These tariffs are NOT assessed if the materials are used for products with the following criteria:

• Energy Products and Critical Minerals: Items not readily available in the U.S. are exempt to ensure access to essential resources.​

• Pharmaceuticals, Semiconductors, and Lumber Articles: Currently excluded but may be subject to future tariffs (under ongoing investigations).

😵 Ramifications:

🚨 Total Combined Risk for eCom Brands:

2. What the Tariffs are Intended to Do

🇺🇸 "Level the Playing Field" for U.S. Producers

🏭 Rebuild U.S. Manufacturing

💼 Address the Trade Deficit

💣 Apply Pressure for Trade Concessions

🗳️ Nationalism & “America First”

📍End Goal:

Restructure the global trading system to favor American interests — through:

• Fairer trade terms

• Stronger domestic industries

• Reduced dependency on geopolitical rivals (esp. China)

• Economic independence and national security

3. What Brands Can Do to Minimize Impact

Supply Chain:

• Move supply origination out of China to retain De Minimis exemption

• Ensure non-China origin is properly documented

• Cut or modify SKUs that are no longer viable under tariff pressure

• Implement dual pricing models: one for domestic, one for international orders

• Negotiate with suppliers to split the financial impact of the tariffs

Marketing & Communication:

• Tackle the issue head on w/ customers & address it if you’re impacted. Communicate this clearly to customers if prices will increase noticeably.

• Pricing strategies you can test to offset the impact of tariffs:

  1. Add in tariff surcharge to each order

  2. Increase product prices

  3. Do nothing and reset KPIs to reflect stricter CAC/MER targets

  1. Pass it on to the consumer as a “tariff surcharge”

  • Some brands are keeping prices as is and just passing through the tariff surcharge to the customer at checkout as a form of additional tax. Here is how The Libertyville Coffee Company is communicating it transparently through a blog article on their site in case any customers wonder why tariff surcharges are being assessed. They even provided their calculation for how the % was determined. This gets ahead of any issues & is an example of a great comms/implementation plan. How did they arrive on 4.1% for every 10% assessed? Unclear. They likely split the fees w/ their suppliers so their exposure is far less than the 10% assessed.

    • Here’s an example of how The Libertyville Coffee Company is implementing the surcharge at checkout:

      

  2. Increase prices of products by the $ amount each product’s landed COGS just increased.

     Example:

     • If you had this scenario PRE-tariffs:

       • COGS: $10

       • MSRP: $40

       • Gross Margin: $30

     • If you manufacture in China and your COGS now increased 20%+34% (54%), here’s what your present day scenario would look like if you couldn’t negotiate with suppliers to share the financial burden:

       • COGS: $15.4

       • MSRP: $40

       • Gross Margin: $24.6

     • If you rolled this delta into your MSRP, here’s how your new scenario would look:

       • COGS: $15.4

       • MSRP: $45.4

       • Gross Margin: $30

     • The only downside here is this: will your consumers tolerate a price hike of 14%? From $40 to $45.4. Only one way to find out! To test it. If conversion rate is not impacted, you found your potential solution. Unfortunately it’s oftentimes not this simple.

  3. You can elect to keep prices as is and redefine your performance targets (CAC, MER, etc) to maintain your pre-tariff contribution margin

     • this is THE hardest to accomplish without sacrificing significant scale from paid media & something I’d recommend against

       Example:

       • If you had this scenario PRE-tariffs:

         • COGS: $10

         • MSRP: $40

         • Breakeven CAC: $30

       • If you manufacture in China and your COGS now increased 20%+34% (54%), here’s what your present day scenario would look like if you couldn’t negotiate with suppliers to share the financial burden:

         • COGS: $15.4

         • MSRP: $40

         • Breakeven CAC: $24.6

           Reducing your CAC by 22% without significantly cutting budgets is nearly impossible.

     • Another spinoff from this could be to try and increase AOV by the same proportion your COGS increased to try and maintain CAC with a higher AOV. Also challenging.

When testing pricing strategies, never make sweeping changes on your site, ALWAYS implement tests in a controlled environment where only 1 variable is changed. Be sure to review performance of your control and test group in different slices and always make sure you have apples to apples comparisons.

Analyze new vs returning site visitor performance, source/medium, and new vs existing customer performance in each test group.

4. What Brands Plan to Do

DTC Newsletter recently published a survey of 500 brands that reviewed the impact of tariffs, brand sentiment, and how they’re responding. I highly encourage you check it out. Here’s a snapshot from the survey that highlights what brands are actually planning to do in the wake of these tariffs rolling out:

According to Internet Research Unit, April has already seen the highest price change events in 2025 across ecommerce brands. Both days crossed 5M+ price changes. IRU monitors price volatility across online brands, among many other things. It’s a great index to track during these times to understand how the industry is reacting to macro events.

That’s all for now on tariffs.

This is a fluid situation. I will try to keep you updated as material updates roll out!

What I’m Listening to 🎧

Beats of the Week: SHIMZA (Factory Town Miami March 2025)

The world has been doom and gloom for the past few weeks. Inject some good vibes into your day with Shimza, who has been on fire. He was all over Miami a couple weeks ago for Miami Music Week. He’s one of the fastest rising & most consistent producers in the game right now. Authentic afro house with great vibes & energy.

Every week he puts out a new hour long mix on his Karma Karma Radio series. Keep the beats flowing with his Soundcloud station here.

I welcome all feedback. Good, bad, everything in between.

Hit reply, and let’s hear it! 👂

📧 Share your thoughts or what you want me to cover next!

🔎 Examining the Details of the Muddy Waters AppLovin Allegations/Claims

Illustrating the rise of AppLovin & the attempt by short-sellers to drag it down. Created with ChatGPT.

Introduction

Last week (March 27, 2025), Muddy Waters Research published a scathing short report on AppLovin; stock ticker $APP ( ▲ 3.22% ) .

They titled it: “Deep Data Analysis Shows APP is Just Another Scammy AdTech Company.”

In the past month, that makes it 3 short reports:

1. Fuzzy Panda: “APP drives fraudulent conversions”

2. Culper Research: “APP steals data from Meta to drive sales”

3. Muddy Waters: “Performance is SO GOOD it's impossible”

There were a lot of claims in there, some I can speak to and provide more color on than others. I will review each point below with my perspective.

Disclaimer: I am NOT a paid promoter of AppLovin. I am not paid by them or anyone with an interest in them to speak on their behalf. I own an immaterial amount of their stock (< 1% of my portfolio) which was purchased by me due to my belief in their ad platform & upside potential. The views expressed in this blog are my own and do not reflect the views of my employer or any company with which I’m affiliated. The information provided below does not constitute financial advice and is for informational purposes only.

The Structure of Muddy Water’s Review

Muddy Waters actually brings data to the table, which the other reports lacked. In the report, they reviewed:

• 5 Shopify Brands that advertised on AppLovin

  • apparel, beauty, hobby, healthcare, & other verticals

• 7 week span: 12/30/24 to 2/16/25

  • these 5 brands did $300M in revenue over this time frame

  • If we extrapolate this, we know the average size of the brands comes out to ~$446M in annual GMV. These are large brands.

• 37 million unique users in this time frame reviewed

  • If we extrapolate this, $300M/37M = $8.11 revenue per user

Let’s start here - - - The brands tracked in this study are LARGE brands (averaging 0.5 BILLION in annual revenue). Given that the average revenue per user is $8+ (standard deviations above the industry norm), this already indicates that these brands rely heavily on returning customers. This sets the stage for some of the claims made.

CLAIM I.

My Take: In order to have any merit on a claim based on % of users on site from a particular source/medium, you would need to know how much the brand spent on ads during that time frame, what % of their budget it was, and what % of their site traffic came from paid channels. Without that, a 3.4% figure has no context. Also, for brands of this size (avg of $446M annual GMV each), you would never expect a high % of users to come from a new paid channel. Especially when the brands average $8+ revenue per user, indicating a large percent of traffic being returning customers or subscription re-bills.

CLAIM II.

My Take: Regarding the retargeting claim, MW states that 52% of users who had APP as the last click purchase were not also the first click to the website. First, we all know by know that APP’s biggest limitation is their lack of audience segments and thus their inability to exclude previous website visitors or existing customers from the campaigns. This is an issue with user identity on their platform at the moment (which I believe can be resolved over time as more PII is stored from ecom ads).

HOWEVER- given the size of these brands that were referenced, they most likely already have tens of millions of customers lifetime and likely are not solely focused on new customer acquisition. They have likely saturated a significant part of their TAM already. Now add in the fact that you can not exclude previous website visitors or existing customers from your APP campaigns. In reality, the fact that 52% of APP last click conversions had APP as the first click in the user journey AND the last click in the user journey is actually pretty damn good.

Also- let’s clear the air here. You can retarget any website visitor on any ad platform (even if that visitor never came to the site from that ad platform). So, there is nothing wrong with retargeting Meta-driven users on AppLovin’s placements. Brands do this across all platforms already. The only downside is that there’s no way to control targeting on AppLovin, so if new customer acquisition did decline on AppLovin, there would be no way to control for it, and thus would limit spend potential on the platform.

And- keep in mind these are CLICK-through conversions. This is much different than view-through conversions which have far less value (arguably closer to 0 than 100% impact). Brands of this size are more concerned with driving incremental conversions and less concerned with which audience segments the conversions came from.

CLAIM III.

My Take: So, lets discuss the “incrementality” reference as it’s more important. Muddy Waters claims that AppLovin only drove 25-35% incremental conversions. But their definition and calculation methodology are objectively wrong. They basically assumed that incremental conversions could only come from conversions where APP was the first click (WRONG- you can have incremental conversions come from existing customers, retargeted users, etc), so they took 48% (100-52%) that had APP as the 1st click and they then excluded 29% of these users who also had other platforms in the click journey of the user, leaving them with 34% “incrementality.” Again, you could have an incremental conversion that had other clicks in the user journey. They then calculated the low bound of incrementality by referencing Shopify’s benchmark of 28% repeat customer rate and excluded an industry avg repeat customer rate from the leftover “incremental” conversions, which gave them the 25% low bound. Once again, you could drive incremental conversions for repeat customers through advertising.

Also, keep in mind AppLovin only attributes CLICK-THROUGH conversions. This is far different than view-through conversions where retargeting can absolutely fluff numbers. If someone clicks through an ad and purchases a product from that brand’s website within a tight window, such as 1 or 7 days, there is a better than average chance that ad was impactful in driving the conversion, aka it was likely incremental.

The definition of incrementality in performance marketing is this: did the ad cause that person to purchase from the brand? OR were they going to purchase in that time frame anyways? The only way to quantify incrementality is through structured testing like a holdout study.

CLAIM IV.

My Take: On January 3, Muddy Waters scanned websites and found 776 websites with the AppLovin Axon pixel installed. In March, 171 no longer contained the pixel. There are likely also cases in which advertisers paused spend and did not remove the pixel, so in reality there could be more.

However, something to keep in mind is that during this window of time, AppLovin actually took down MANY lead gen advertisers who had low quality funnels. AppLovin is mindful of user experience and does not want user experience to take a hit from their mediated ads. Some of this churn can easily be attributed to this issue.

There are definitely instances where the platform did not work for some brands and those brands churned. That’s normal & expected. Who’s to say those brands won’t be back? WAY too early to track churn & draw conclusions from it.

The real data to look at would be what % of advertisers started spending their own ad dollars after the ad credit ran out? I don’t have this data, but something that would be noteworthy to look into.

I have a few anecdotes from advertisers who paused spend there because they simply didn’t have the internal bandwidth to devote to another channel at the time and give it the attention it needs to create alpha and true impact on the business. Keep in mind, in order for something to become a fixture in any brand’s media mix, it must have tangible impact on the business. This is done through scale. Brands require scale to drive impact (especially if they’re doing at least $10m in annual GMV- which this closed beta requires). If a brand doesn’t have the internal resources to unlock scale, it gets cut.

CLAIM V.

My Take: This is actually the most serious allegation there is, and the most difficult to prove without forensic investigation. Let me preface this by saying that I am by no means a conversion tracking/data expert. There is an entire industry dedicated to this within ecommerce.

However, I have a solid enough understanding to be clear that ecommerce brands all have different data practices with their own first party data. There are an endless amount of Shopify plugins that will append data and send them to platforms, per the brand’s direction. This is their own first party data. They have the right to leverage their data to sharpen platform algorithms in their optimization practices. This has nothing to do with ATT. Server sided tracking is actually what was built as the solution to ATT & that firestorm that ensued.

If a brand has a plugin like Elevar, and Elevar sends data to AppLovin, it’s actually going to the other platforms as well, as the brand intended. Brands choose whom to send data to and which plugins to use. AppLovin’s CTO highlighted this example in his recent blog article that examined data practices for ecommerce brands.

If a brand does not have such a plugin that appends additional information (as in the Crocs example the CTO highlighted), the Facebook ID was NOT sent to AppLovin. There is visual evidence/proof of this in the blog article linked above.

AppLovin’s CEO also put out a blog article in response to Muddy Water’s piece, which clearly stated that when information is sent to App’s servers that it does not ask for, it’s purged when it hits their servers.

I spoke with CEO of Source Medium (ecommerce data infrastructure company), Fei Wang, about this situation and he summed it up well:

As such, AppLovin is likely only using data it is rightfully in possession of, it still has not been proven otherwise. Innocent until proven guilty, right?

CLAIM VI.

My Take: In 2024, Google prevented 1.3 million apps from getting excessive, unnecessary access to sensitive user data. In 2022 and 2023, Apple terminated over 500,000 developer accounts. If AppLovin was egregiously violating Google & Apple App Stores TOS as well as Meta’s Audience Network TOS, don’t you think it would have been detected by now?

Droves of dev accounts have been taken down over the past few years. Wouldn’t a company with $100B market cap be the first to get detected and eradicated? Especially on Meta, who some perceive to now be a competitor. This company didn’t come out of nowhere, they’re on an $11B annual run rate on mobile game and ecommerce ad revenue now.

Common sense in me tells me that they have not flown under the radar, especially now in light of all the attention they’ve gotten.

With regard to Muddy’s claims that App embarked on a token-changing journey across environments, Fei had the following thoughts:

This topic is out of my purview for the most part, but common sense has me thinking that AppLovin is not engaged in any malicious cover-up scheme which would be seriously shocking and disheartening.

CLAIM VII.

My Take: There’s a reason why AppLovin has 4x’ed ad revenue in the last 2 years since launching Axon 2 (their new algo). Because it actually works. Their AI/ML systems have outperformed long before ecommerce ads were even a thing for them.

At this point, I’m under the assumption that AppLovin is operating with integrity & in accordance with privacy policies. They aren’t maliciously extracting, storing, and using data that it does not have legal rights to.

Conclusion.

Anytime a short report comes out that can move a market, there’s typically inherent bias. These reports absolutely can move a market and these short sellers are often out of the trade shortly after. So these reports are intended to be the catalyst to make their self-fulfilling prophecy come true: to drive the stock down and make quick money.

That isn’t to say there isn’t merit to any of these claims potentially turning out to be true. Can some of their PIG/fingerprinting claims end up being true? Sure. But, the jury is still out and time will tell. Now that the company has gotten so much attention, I assure you Apple, Google, and Meta are all investigating very closely. If anything malicious turns up, it will be swiftly identified and made publicly known.

From an ecommerce marketer’s perspective, many of these claims are grasping at straws and are very difficult for a layperson to analyze if they do not possess inherent knowledge about digital marketing and conversion tracking.

It’s pretty clear to me that from an ecommerce perspective, the retargeting & incrementality claims lack the merit and context required for Muddy Waters to prove their point.

To this very point, my POV is that AppLovin’s success is mostly attributed to its non-skippable ad format, its strong Axon 2 algorithm, its scale potential, and the novelty factor it has with its audience. We still haven’t scaled a brand yet to anywhere near the level of Meta, but the amount of spend we’ve been able to achieve there this quickly makes it highly intriguing.

I welcome all feedback. Good, bad, everything in between.

Hit reply, and let’s hear it! 👂

📧 Share your thoughts or what you want me to cover next!

Q1 2025 is starting to feel like Q1 2022

Before we dig into the doom & gloom of 2025’s rough start, some positive news:

I made it out to SF last week to speak on a panel at KeyBank’s Emerging Tech Summit and carved out time to visit AppLovin’s Palo Alto office. Upon review: I can confirm there are no Russian spies, Chinese spies, click farms, or other risky business at play here.

Actually- for a company that eclipsed a market cap of $100B+, I was pleasantly surprised to see it resemble a startup more than a cushy big tech co. They’re surely an enigma and one of the more fun topics to cover in the past year.

Now, back to regular programming:

2020-2021 felt like the glory days, everything working in brands’ favor.

Then Q1 2022 hit where inflation surged and the Fed had to start hiking rates aggressively. This cascaded into a weaker consumer, weaker economy, and the death and destruction of countless consumer brands.

Fast forward to Q4 2024 where the industry came off a record-setting quarter. AI jolted the economy & overall excitement. Brands started returning to “growth days” and the consumer got a lot more confident & spent like a drunk sailor. Was the record quarter most likely due to extended holiday sales that nearly spanned the entire quarter? Did we pull forward all the revenue? Good chance.

Now? Just one quarter later… Ecommerce is stuck in a vicious cycle.

Q1 forecast for GDP growth just plummeted to -2.8%. This correlates to economic health. Negative = bad. This is the worst estimate I can remember in a long time.

Inflation & tariff pressure is increasing COGS ➡️ Brands increasing prices & optimizing for higher AOV ➡️ Weakening consumer not wanting to spend (especially not on price-hiked products) ➡️ Brands are still spending so CPMs are still skyrocketing ➡️ Performance declining.

What gives?

Really all starts with inflation.

Inflation = rate hikes, higher COGS, higher prices for consumers, uncertain stock market, consumer confidence in free-fall.

The silver lining is that the American economy is the most resilient and the world and it WILL bounce back. Patience is a virtue.

1. Shopify Audiences is Understated: Don’t Forget to Use THIS One

Friendly reminder to NOT forget about this Shopify Audience: Retargeting Boost

The equivalent pixel audience would be:

• 90D website visitors excluding 90D purchasers

By simply adding this audience to a 90D Website Visitor retargeting audience, we got 2x the match rate & doubled the size of that exact retargeting audience.

If you wanted to exclude existing customers from this retargeting audience, that is possible. Just exclude the Shopify Audience "Existing Customers" audience at the ad set level.

I also recommend you use this "Retargeting Boost" audience in your "engaged audience" segment in Meta's advertising settings.

The better match rates you achieve, the better things will be for you in the account.

If this is all a foreign science to you, Avenue Z can help optimize your paid media, data, and audience segmentation. Reach out to us here.

2. Inflation is Hitting Product Prices & Performance 📉

Q1 is OFFICIALLY our hangover from Q4. It seems like we pulled forward a lot of revenue.

Maybe b/c brands discounted products for so long & excited the consumer?

According to Particl's product price inflation data, February showed:

• Health & Beauty: +16% YoY

• Apparel: +12% YoY

This is a BIG hike. In 2 of the most popular consumer categories.

This also what I'm seeing on brands. Higher AOVs, higher CPMs, lower performance.

Brands and consumers are at odds. Inflation & tariff pressure cause product prices to go nowhere but UP.

In the wake of rising ad costs, brands really have no choice.

Tracking the economy and understanding consumer psychology is paramount.

Brands need to understand how they're positioned in the category and tackle it head on.

You can track price fluctuations for each product category w/ Particl's free tool here:

Particl

Particl exists to help retailers automate their competitor intelligence with data.

www.particl.com/free-tools/inflation

3. Investors in the Publicly Traded Advertising/DTC Tech Companies are Thinking About THESE THINGS

Last week I participated in KeyBank's Emerging Tech Summit in SF. Spoke on a panel and spent the rest of the day meeting with institutional investors in $SHOP, $META, $GOOGL, $APP, TikTok, $KVYO, $AMZN, $SNAP, $PINS, $RDDT, & more.

I had a full day of meetings, here’s what’s top of mind for them:

• Media Mix: any big shift YoY?

Largely the same for performance dollars in the ecommerce vertical. Budgets in order of highest to lowest are as follows: Meta, Google, TikTok/AppLovin, Snapchat, Reddit, Pinterest. The YoY gainers IMO will be AppLovin & Snapchat in a growing pie. I don’t see budgets being pulled from Meta or Google to test on either of these channels. When performance is there for brands, the budgets don’t shrink.

• The rise of AppLovin

Don’t have to dig too deep here, I’ve been vocal enough about the platform. Feel free to refer back to previous newsletters or tweets of mine! Still seeing strong performance, not even close to the level of Meta scale yet, but gradually working our way up and devising internal best practices before opening the real spigot.

• State & sentiment of TikTok's future

TikTok is here to stay. Pretty sure this is the common sentiment now. Remember when we saw it appear in headlines daily a few months back? Pretty sure my original prediction is still the most likely outcome. TikTok will NOT change as we know it. Whether it’s a new owner, new policy/regulations, etc - - - TikTok will likely be here to stay (in the same capacity that we’ve experienced).

• YouTube/Google: any traction w/ Shorts?

YouTube probably has THE most potential of any ad placement out there. But their lack of urgency & innovation over the years has been extremely painful. As such, they have had 0 traction with monetizing shorts via social commerce or ad units. For whatever reason, you STILL can not buy Shorts-only placements in demand gen. Enough said.

• Shopify: updates on Audiences & Shop campaigns

Shopify Audiences and Shop campaigns are the two most underutilized Shopify products by merchants. In fact, they’re easily the two best marketing/ad products Shopify even has.

I’ll leave it at this: Shopify Audience is our top spending account’s top spending ad set. Shop campaigns take 2 min to set up with no creative needs & is driving more efficient new customer acquisition than any TOF channel (just not close to the level of scale as paid social). Use these tools!

• Snap, Reddit, Pinterest: anything new or exciting?

Reddit & Pinterest: No.

Snapchat: Yes. now that Snap has click-only purchase optimization, it actually has a chance to perform! Snap is also now offering $10k ad credits (no risk) & 25% rebate on all spend for the first quarter for brands just to test the channel again. They’re putting money where their mouth is. This speaks volumes and could be a breakthrough for them.

• Impact of tariffs on ecommerce & performance

Definitely an impact. Brands are raising prices, consumers are spending less, and brands are left with degraded performance.

• AI advancements in creative

Icon is the most attractive AI creative company I’ve seen. It’s already better than the creative AI you’ll see natively available on Meta, Google, etc. This is a company to watch. They went from $0 to $5m in ARR in 30 days from launch. Where there’s smoke, there’s fire. We’ve been testing it internally at the agency and honestly floored by how close they are to making this an essential tool in the stack for turning creative strategists into full blown end-to-end strategists + designers.

The market is “crashing,” should I sell my stock portfolio?!

Been getting this question consistently for the past few weeks so just going to lay it out here.

The short answer is NO.

If you’re losing sleep at night over a 10% market correction, chances are you’re just not invested properly. If you have a meaningful amount of money in single names that you wouldn’t go to the grave with, you’re in a bad spot.

Minimize single name stocks and maximize your position in index funds to achieve diverse allocation among the best companies in the world. S&P 500 index funds are a safe bet that you can expect 8-10% annual gains over time (blended). Always have a cash (money market) position when interest rates are elevated so you get fixed income, but also a chance to rotate out of when the market draws down and you can quickly flip that cash into the index at solid entry points. You should have a portfolio that allows you to sleep good at night even in bear markets.

Stay safe out there.

What I’m Listening to 🎧

Beats of the Week: AVO x JOE & THE JUICE

AVO is one of my top up & comers in the house scene. He’s on Francis Mercier’s Deep Root record label. Listen to the mix below & thank me later.

AVÖ X JOE & THE JUICE [JB Vol. 05]

DJ & Producer AVÖ has put together a dancey selection of tracks for the 5th instalment of our JUICY BEATS series. Expect good vibes, deep cuts, and a set you’ll want on repeat. Enjoy.

soundcloud.com/joesjuicybeats/avo-x-joe-the-juice-jb-vol-05?si=b6cb6821f4ed4359abc6586d93cbe36b&utm_source=clipboard&utm_medium=text&utm_campaign=social_sharing

I welcome all feedback. Good, bad, everything in between.

Hit reply, and let’s hear it! 👂

📧 Share your thoughts or what you want me to cover next!

Over halfway through Q1?!

Where has time gone? Somehow we’re in the latter half of Q1. Crazy to think.

Lots has happened in just 1.5 months. Here are quick hitting industry updates since we last spoke:

• Stock Market: Meta ($META) & AppLovin ($APP) have been on a tear

  • $META: 20D win streak (all green days); stock up 18% YTD

  • $APP: BLOWOUT Q4 earnings call which teased the focus on ecommerce ads; stock was up 37% in that one day alone and now up 43% YTD. More here.

• TikTok: On Valentines Day, TikTok returned to Apple & Google app stores as Trump assured them that there would be no liability whatsoever for the app stores to list the app again. Trump also reiterated that the 75 day extension could very well be extended AGAIN until a deal is worked out. It looks like TikTok is here to stay. This is not going to fade into oblivion like many talking heads predicted late last year. If you’re not on TikTok right now, you’re simply getting left behind. During times of unrest/unknown is when you typically uncover the best opportunities.

• Shopify Feature You Should Turn on Now: Best kept secret is still Shop campaigns if your brand is on Shopify. It takes <2 min to set up and it’s an easy way to acquire new and lapsed customers. I posted a quick review of how to do it HERE.

1. Meta & Google Ads Performance YTD

2025 has been off to a mixed start. After the best BFCM/holiday shopping season on record, this year has been a mixed bag.

Lets break down what we’re seeing on both of the main channels YTD (Jan 1 - Feb 18, 2025):

Meta

• Spend: +7% YoY & +5% QoQ

• ROAS & CPA: looking at our Top 10 spenders, 8/10 actually have worse performance in ‘25 vs ‘24, but 7/10 increased spend nonetheless. Overall, we’re seeing softness in Q1

• CPM: +24%

• CPC: -28% (CTRs up significantly, accounting for lower cost of traffic to site)

• AOV: +13%

• FB & IG REELS: Biggest spend (& performance) gainers of 2025 YoY.

In summary, brands have increased spend on both a YoY and QoQ basis, which is good news for $META. Seems like performance has generally declined year over year, but AOV is notably higher which makes higher CPA a bit more digestible. However, ROAS is also down at large which accounts for AOV increase. This means that brands increasing prices may actually be impacting performance negatively. Something to keep an eye out for when testing pricing strategies.

Meta is going deeper on Reels, prioritize short form content NOW! Meta is shifting budget from Feed to Reels drastically. Be sure to upload Reels specific content to each ad set where Reels placements are selected.

Google

• Spend: -10% YoY & -22% QoQ

• ROAS & CPA: looking at our Top 10 spenders, half are seeing better performance, half are seeing worse performance YoY.

• CPM: -12% YoY

Google still boring. No real updates here other than BAU. I was hoping they’d make faster progress on being able to test YouTube Shorts content only in Demand Gen. Still not possible. YouTube Shopping/affiliate has also been super slow to roll out and there is virtually no scale there…yet. Seems that YouTube is behind the curve on what performance marketers are looking for.

2. Meta Musings

Wanted to point out a few KEY reminders/issues still widespread on Meta.

1️⃣ MASSIVE BUG on Meta Feb 8-10: Seek Refund if You’re Impacted!

Inspect your account and seek refund from Meta ASAP.

👉 What Happened

Ads Manager showed a MASSIVE spike in conversions (with no assigned purchase values) and Events Manager did NOT show corresponding spike. AKA fake conversions flooded the system.

If you see this happened on your ad account from Feb 8-10: you are impacted.

From Meta:
"On February 8, 2025, at 12:00 AM PDT, a recent configuration change had caused the reporting and ranking issue, and we rolled back that configuration to resolve the issue. The issue was resolved on February 10, 2025, at 4:57 PM PDT."

👉 Ramifications

- If you run Cost Cap campaigns & push high budgets purposely, you got really screwed as your full budget was likely spent.
- Algo got thrown into disarray: during these days, performance at your store level was likely nuked
- Algo will take days to recover, so expect turbulence until the dust settles
- Meta unable to correct reporting data in ads manager retroactively to these dates

Drop what you're doing and check your accounts if you haven't already. Meta always makes right by this and will likely reimburse you.

What sucks is that lots of damage on lost revenue has been felt by brands and will not be accounted for. The cost of doing business!

2️⃣ STOP Wasting Budget on Existing Customers Unintentionally!

I still see so many brands spending money on existing customers without even knowing it. Purely b/c of improper exclusions & audience segment definitions in their ad accounts.

The above example shows an ad set that had 25% of budget spent on existing customers...
❌ yet it excluded: purchasers (pixel), existing customer order export, AND Klaviyo lifetime purchaser audience

Theoretically Meta should have spent $0 on existing customers, right?

Here's the gap: In Meta's audience segments definition, the brand also included Shopify Audience's Existing Customers (this is the ideal scenario)... the ad set did NOT (not ideal).

Here's the difference in audience size between Shopify Audience Existing Customer segment vs the next largest "existing customer" segment: Klaviyo

👉 Shopify Audience: 9,300
👉 Klaviyo: 2,800

Meta ended up targeting a ton of those 6,500 people that were in the Shopify Audience existing customer segment that were in fact not matched in the Klaviyo "existing customer" segment.

This brand utilizes Meta SOLELY for new customer acquisition. And thus, comprehensive understanding and utilization of audience segments is CRITICAL.

Anyone claiming that "audiences" do not matter on Meta anymore simply fails to understand the platform.

The less insight you have on where your spend is actually going (& thus the less control you have), the less effective you'll be at achieving your goals.

Now imagine if you don't have Shopify Audience Existing Customer segment in the "existing customer" definition on Meta... you'd think you're spending $0 on existing customers.... yet in reality a significant level of spend would be going to them in secret.

3️⃣ STOP Firing Purchase Events for Subscription REBILL Orders!

Too many brands are still firing purchase events on subscription rebill orders.
Data & measurement: garbage in, garbage out.

The FOUNDATION of your data & ad accounts is THE most important thing.
Yet so many still get it wrong.

Make sure your pixel purchase event is only firing for purchases, not rebills.

3. The Rise of “Agentic” Commerce

A few weeks ago, OpenAI announced the launch of “Operator & Agents” which is the latest groundbreaking advancement of AI.

This is a graduation from ChatGPT. Instead of just researching & supplying answers, AI can now act on behalf of a user and complete tasks: make reservations, buy tickets to an event, order things on DoorDash, etc.

If you haven’t yet heard the term “agentic” AI, get used to it. You’ll start hearing it daily.

Through an AI agent, you essentially have a copilot/workhorse to complete tasks for you. Consider it your personal assistant.

Now how will this impact the world of commerce?

In many ways, but to classify it in the 2 distinct categories:

• Consumer: personal shopping

  • Need gift ideas? have your agent ideate, present you options, and transact for you.

• Merchant: task completion

  • have tasks you need your agent to complete?

  • want to collect more 0 party data on your customers?

  • want to find potential influencers/affiliates in your existing customer base?

Yeah, this stuff is possible. Bain Capital put out an informative piece on this topic a few months ago.

We’re going to see a massive reckoning in brand strategy and commerce technology.

Brand Strategy:

There’s actually going to be a huge shakeup in the world of SEO. As organic search traffic from Google & Bing diminishes, AI search is where new winners will emerge. As people start deploying their own agents, if your competitors start appearing in AI search results for these non-brand search queries, you could very well start shrinking website traffic & revenue without realizing until it’s too late. It’ll be a slow bleed until you identify this inevitable issue.

The best way to get ahead of this?

By executing against a framework for optimizing your AI search results.

I broke it down: 7 Ways for Ecommerce Brands to Optimize their AI Search Presence HERE.

Is This Ad “Growth Marketing” ?

Twitter tweet

Saw a lot chatter on the X timeline this week about this ad.

Honestly- the most growth Tecovas probably saw from this creative is from Taylor’s tweet… I joke.

My thoughts:

• This is a solid “television” ad. This would rarely ever be scaled by a brand that is sub multi-9figs in revenue that focused on contribution margin or profit.

• This creative likely cost 100x more than a piece of UGC

• This creative has generated Tecovas their:

  • lowest view count & engagement of any recent post on their TikTok and

  • one of its lowest view counts & engagement on Instagram

  • clearly social platform algos do NOT like this creative organically (& would likely flop on paid as well on key metrics)

• I think this is a “cool” & aspirational creative that will appeal to its target market… but did this creative GROW its TAM? Not so sure. To me, their “Work” line of products appeals to their existing customer base already, whom they already could have reached efficiently in other ways.

  • This makes the creative not useful for the vast majority of brands, especially not on social.

  • Not sure where this creative was meant to live primarily, but I think it would perform best as a Super Bowl type ad spot on a big screen. I DOUBT this creative would grab attention of the short attention spanned audience on social

BOTTOM LINE: This is NOT growth marketing if we’re considering this a pure-play social media creative. Didn’t perform organically & likely didn’t perform on paid if I had to guess. GROWTH = objective, backed by numbers. The numbers publicly available for this creative do not support anything growth.

If this was run as a Super Bowl ad, I’d be more ok with slapping the word growth on it. It would open up their TOF more broadly as most of their TAM is watching the Super Bowl. It clearly didn’t reach their TAM on social.

What I’m Listening to 🎧

Beats of the Week: KITTY AMOR on Keinemusik’s Radio Show (Feb 14, 2025)

Keinemusik Radio Show by Kitty Amor 14.02.2025

@djkittyamor

soundcloud.com/keinemusik/keinemusik-radio-show-by-kitty-amor-14022025?si=7369d40cf7a1419cb90fabc44e5567df&utm_source=clipboard&utm_medium=text&utm_campaign=social_sharing

Kitty Amor is a rising start in the afro house world. Give this mix a listen. Solid energy, upbeat, and a new artist to be excited about. She also just started her residency on BBC Radio 1. If you like the above mix, give her a listen each week for the next few weeks HERE!

I welcome all feedback. Good, bad, everything in between.

Hit reply, and let’s hear it! 👂

📧 Share your thoughts or what you want me to cover next!