Unprecedented Discounts Help Predict Weak Outlooks
The signal we are typically most focused on providing our investor partners is when brands change how they communicate with their leads and customers. Ramping up email marketing is often the cheapest and easiest way to engage customers. When brands are struggling, instead of posting a discount publicly on the website, they can target specific segments and cohorts.
For the case of brands like Crocs, we see this often in the form of “we miss you” type emails. Growth in these type of emails helped us uncover a structural slowdown in demand for Crocs in the Unites States.
Above we note that prior to 2024, Crocs never sent these type of storewide 30% off coupons. This inflection was missed by the street because transactional data, and website scraping failed to detect this behavioral change.
Looking at another example this year, we see below our our promotional ensemble detected new escalating discount intensity from Peloton. Despite noise about a turnaround and confidence to investors, behind the scenes management was escalting the discounts.
Above we see rare growth in $1500 off for Peleton bikes and treadmills.
Sometimes changes in keywords are more sutble. But this is often the most interesting use-case. Many premium brands present themselves as not having to discount. However, again, behind the scenes they are escalating their promotional intensity.
Here we can see Canada Goose, as they were likely noticing slack demand, they ramped their Winter promotional campaigns.
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