January 2024: The online retail and e-commerce industry embarked on a dynamic journey in 2023, experiencing a mix of positive and negative influences. In the face of global economic challenges, the e-commerce sector has defied the odds, experiencing robust growth with estimated worldwide sales reaching an unprecedented $5 trillion by the end of 2023. Key drivers behind this surge include an increasing consumer affinity for online shopping, the ascent of social commerce, and the widespread adoption of omnichannel retailing strategies.
Despite this massive scale and growth, the sector has not gone without challenges, the main ones being rising inflation, supply chain distribution, and labour shortages. The rising inflation has reduced the consumer spending power, resulting in a more cautious approach to e-commerce purchases. Consumers, mindful of their wallets, are gravitating towards lower-priced products and services, impacting overall sales within the sector. Meanwhile, the persistent challenge of supply chain distributions has led to delayed deliveries and escalated shipping costs. This, combined with labour shortages for workers for warehouse and delivery positions, has resulted in slower order fulfilment times and augmented operational costs.
Growth in the German E-commerce Market
Within this environment, the German e-commerce market has demonstrated resilience and growth, with estimated sales surging to €102 billion in 2023. Factors such as the increasing popularity of online shopping, the expansion of online grocery delivery, and the embrace of omnichannel retailing strategies have been instrumental in driving this growth. For DCMN as a growth partner for D2C brands with a strong focus on e-commerce, it is crucial to monitor and understand how such brands operate in the German market and what consumers think about them. That is why we have developed the DCMN Brand Tracker.
Brand Awareness Insights from the DCMN Brand Tracker
To navigate the ever-changing market landscape, businesses have increasingly relied on tools such as the DCMN Brand Tracker. The monthly study surveys 2000 German consumers, tracking over 300 brands across 20 industries. Focused on digital brands and start-ups, the tracker offers vital insights for emerging companies, enabling them to measure their standing against both large and small competitors. It offers valuable insights into brand awareness, consideration, and perception. In this article, we will share and discuss data collected from April to December 2023. Our goal is to shed light on the dynamic nature of the digital brand landscape in Germany.
Germany’s Best-Known Digital Brands Based on Brand Awareness
The evolving landscape of brand awareness among Germany’s top 20 digital brands from April to December 2023 reveals dynamic shifts in consumer attention. Let’s look into the frontrunners and how their brand awareness changed in 2023.
Netflix, a streaming giant, demonstrated resilience by remaining first in the brand awareness ranking and closing the year with an impressive 88%. Despite intense competition and the evolving nature of the streaming industry, Netflix maintained its stronghold as the go-to platform for digital entertainment. Ikea, the Swedish furniture retailer, kept its position as the second most recognised brand according to the survey. In third place, with a solid brand awareness of 86%, we saw Amazon, the online retail giant powerhouse.
Zalando, a prominent online fashion retailer, witnessed a commendable ascent in brand awareness from 80% to 85%. This growth underscores the brand’s adaptability in navigating the dynamic online shopping landscape. In an industry where trends and consumer preferences can swiftly change, Zalando’s strategic initiatives seem to have struck a chord with consumers.
YouTube, the social networking giant, witnessed a notable increase from 77% to 82% in brand awareness. This growth signifies the platform’s enduring popularity and its central role in the digital lives of consumers. As social networking becomes increasingly intertwined with daily routines, YouTube’s heightened awareness is a testament to its cultural significance.
Among the top 20 brands, About You stands out as the one that saw the highest increase in brand awareness – 6%. A great achievement for a brand with an already strong position in a dynamic and competitive market.
Dynamic Newcomers: Biggest Brand Awareness Increase
Maintaining a consistently high ranking in brand awareness is undoubtedly a significant achievement. However, the thrill of creating a notable impact as a newcomer is equally exciting. In our second chart, we look into brands that experienced substantial increases in brand awareness from April to December 2023.
With a substantial 9.5 percentage points increase, Mydays, an entertainment and leisure brand, made a remarkable impact on consumers, highlighting the demand for diverse leisure experiences. Shein followed with a 9.4 percentage point increase, mirroring the evolving preferences of consumers in the fashion and e-commerce sphere. Attracting an 8.8 percentage points increase, Call of Duty: Mobile underscores the dynamic nature of the gaming industry, where mobile platforms play a pivotal role in engaging audiences. And with an 8.3 rise, Freevee’s emergence in the streaming services category signifies the continuous evolution and diversification within the digital entertainment landscape.
Takeaways and Strategic Implications
The study underscores the volatility of the digital market, emphasising the need for companies to stay agile in adjusting their branding and marketing strategies. Established global players like Netflix, Ikea, and Amazon continue to hold top positions, but sustaining high brand awareness levels remains a challenge. Especially against newcomers who are aggressively building brand awareness.
Looking Forward: The Importance of Adaptability
“In the dynamic landscape of Germany’s digital marketplace, adaptability is key. Established brands like Netflix and Amazon maintain their positions, yet the rise of newcomers such as Mydays and Shein underscores the ever-changing consumer preferences. Success hinges on navigating shifts, understanding the audience, and innovating to meet the demands of the digital-savvy audience. A forward-looking marketing strategy is essential for D2C brands aiming to not only survive but thrive in the competitive digital landscape.” commented Tugce Yilmaz, Senior Insight Manager at DCMN.
As the study reveals the fluctuations in brand awareness, it becomes apparent that the digital marketplace is a dynamic arena where adaptability plays a crucial role. While established players like Netflix and Amazon continue to command attention, the rise of newcomers such as Mydays and Shein highlights the ever-changing preferences of consumers. Brands that effectively navigate these shifts, understand their audience, and innovate accordingly are poised to not only survive but thrive in the competitive digital landscape. The journey towards sustained brand awareness requires a keen eye on consumer sentiment, rapid adaptation, and a strategic approach to meet the evolving demands of the digital-savvy audience. A forward-looking marketing strategy, tailored to the distinctive features of the digital landscape, is essential for D2C brands aiming to thrive in the current market.
You want to know where your brand ranks in terms of brand awareness, consideration and perception among the German consumers? Just contact us and we’d be happy to help.