Zero Clicks #16: Power laws

Every week in Zero Clicks, we explore the interplay of AI, media, and commerce.

This week we’ll dive into..

• Big picture: The rich in commerce getting richer

• Job posts: Prestige brands are embracing Amazon

• State of the chart: You are all getting too good at this— this week is a bit harder

For the last three Novembers, the vibes heading into peak shopping season have been anything but immaculate.

In 2021, the iOS 14.5 fallout was becoming real and marketing leaders began to realize the cold reality that COVID hadn’t, in fact, permanently catapulted eCommerce adoption by a decade. 

In 2022, inflation ran amok and we hit Black Friday with Amazon and Shopify stocks down 50 and 80% respectively from their highs. 

Last year, there were glimmers of hope but as an industry, we were still a few more gulps of Pedialyte away from curing the COVID hangover. 

But amidst the chaos, something interesting happened. With the Meta money printer on vacation, brands were forced to reinvest in the lost art of content and storytelling. Those efforts will pay off in spades as tried and true growth marketing channels start to work again.

All told, we have the perfect groundswell of conditions for the top echelon of eCommerce brands to have a monster 2025:

1. Massive increases in organic traffic from Google disintermediating publishers and driving traffic directly to brands who invested in quality (and sometimes even dubious) content.

2. The emergence of entirely new, highly incremental ad tech platforms like AppLovin, which provides a jolt of largely new customer acquisition. For now, though, they have restricted access to their platform to brands spending $600k/mo (!) The rich get richer.

3. Meta’s AI investments are starting to bear fruit, providing predictable-ish ROAS again, albeit with a heavy bias towards driving performance for established brands vs. serendipitously introducing new brands to users.

The winners here will be companies that sweated out the lean years, right-sized their unit economics to profitability, and prepared for a world after arbitrage, who will be able to turn the Meta, Google, and, now, AppLovin spigots up to eleven.

Power laws eat every industry eventually and 2025 is the year where they start to fully gobble commerce. The future belongs to brands that have an unfair organic distribution advantage and can leverage large tech platforms for simple demand capture vs. demand creation.

Make no mistake, the vibe around marketing and commerce is infinitely better than it has been in the runup to either of the last two holiday seasons. We mostly have Mark Zuckerberg to thank for that.

It’s markedly uncomfortable how much the prevailing sentiment in commerce is based on how well Meta is performing at a given time for brands. But it’s the reality of this business. Zuck is our deity, an all-powerful omniscient being wrapped around commerce.

For better or worse, Meta (and Amazon for that matter) seems far more interested in making existing kings richer than minting new kings. My prediction is that True Classic will be the last $500M+ brand built from nothing, initially scaled on sheer mastery of the Meta machine. That they are leaning in so heavily on AI-driven customer journeys vs. conventional shipping experiences should tell you something about where marketing is headed.

It’s a fun time to be a marketer at a marquee brand– you can own your traffic, the old platforms are ripping, new platforms are emerging, and the first true paradigm shift in how consumers shop online is on the horizon.

Amazon 3P FBA Manager, L’Oreal

Five years ago, Amazon was a poisonous concept to any company that fancied itself a “capital B” brand. Now, not only is one of the largest prestige outfits on the planet embracing Amazon, they are jumping into the muck of Amazon’s third-party seller ecosystem rather than simply operating as a 1P wholesale vendor. This is smart– L’Oreal sees Amazon as existentially important to its future and wants to better own its destiny.

It’s also indicative of a larger trend in whose interests Amazon serves. Launching a brand on Amazon is harder than ever as the PPC arbitrage is on death’s door, largely due to Amazon’s embrace of Chinese sellers. Your margin is Jeff’s opportunity.

But there’s another major winner in the new Amazon ecosystem. Household brands that have massive built-in branded search can no longer be easily outflanked by scrappy upstarts who master paid marketing on the platform. The billion-dollar brands that unapologetically embrace Amazon are set up for a monstrous 3-5 year run. L’Oreal’s ability to swallow their pride and dive in headfirst suggests they’ll lead the way.

Brand Communications Manager, Anthropic

Fans of this newsletter know that I’m a hopeless sucker for unconventional job postings and this one takes the cake. Anthropic is hiring for a “uniquely weird” role where the hiring manager went on Twitter and shared the requirements in an Apple Note. GOATed as hell.

The cynic in me wants to say that the actual JD reads a lot like what I’d expect brand communications to encompass. But in both the job post and Sam’s color commentary, Anthropic specifically calls out that they are open to “unusual backgrounds.” No word yet on if Tom Jones has applied to be the voice of Claude.

VP, Marketing, The Information  

The Information is now a decade old and has solidified itself as essential reading for tech executives… which makes it easy to forget just how batshit crazy of an idea it was to charge $400 for a digital media subscription in 2015. Jessica Lessin pulled off the unthinkable in media– now she needs a marketing leader to truly solidify the brand and expand it to horizons beyond hardcore Silicon Valley.

Lessin herself said it best in a recent post reflecting on the current state of media: “It is hard to overstate the significance of the next four years. Publishers face a choice. Go after subscribers by pandering or informing.”

In case this hasn’t been clear to date, all of the memes you see in Zero Clicks are originals. We can’t write a newsletter bemoaning the amount of derivative content on the internet and then copy memes :)

Congrats to friends from Levanta, Vox, Pie, Archer, and a few others for getting last week’s answer correct.

This week, we’re featuring our first all-time stock chart and our first using Perplexity Finance instead of Google. Here, we have another narrative violation company that is currently touching all-time highs.

Given how smart you all are, I expect at least five correct answers back :) 

Reply directly to this email with your guess. First one to guess correctly (without help from AI) gets a shoutout next week (plus unlimited bragging rights in their company Slack).