Growing in a downturn
Also: Oura’s new Gucci ring. And: Wednesday is the new Monday (and the new Thursday).
The main business topic since I last wrote has been continued uncertainty about the economy, and how consumer spending will continue to shift in the context of inflation, higher interest rates, a potentially looming recession, layoffs, the end of certain pandemic behaviors, etc.
This includes a warning from Snapchat this week about the health of its advertising business (which sent its stock down more than 40% on Tuesday; good analysis at Stratechery) and commentary on Target’s earnings call last week (unexpected slowdowns in categories like home, electronics, sporting goods, and apparel, as consumer spending shifts back to experiences and as we lap the final 2021 stimulus checks).
Consumer spending is still holding up overall, for now, and still growing in categories like travel, events, and dress clothes. Looking at the same data I published a few weeks ago, as measured by Earnest Research, US e-commerce spending is still down most weeks on a year-over-year basis, but declining at lower rates than in March and April. And offline spending has re-accelerated and continues to grow over this time last year.
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