How has the big e-commerce store mitigated the effects of the market downturn?

Introduction

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2022 has been a hard hit on reality for a large part of e-commerce stores. After a long period of huge acceleration of e-commerce due to the pandemic, the growth of markets has slowed down and many stores are solving problems with purchased goods in stock, some of them even laying off their employees, and all players perceive a slight cooling.

Since we are very interested in this topic in Tanganica, we decided to start analyzing it more on specific e-commerce stores. In this case study, we will detail a large store, which is now experiencing a year-on-year decline in revenue from paid Google of about 34%.

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Basic information:

Overall performance of the e-shop in 2021: 4 682 892 €

Overall performance of the e-shop in 2022: 3 502 168 €

Year-over-year decrease in total sales: - 25.21%

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Explanatory notes:

google/cpc = client campaigns on Google, including brand

tanganica/cpc = campaigns launched in Tanganica.com (Google only)

*The store first launched Tanganica.com campaigns in July 2022.

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Performance of store's own campaigns

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In this off-peak season, we see relative stability in client campaigns, with a decline of just over 7% from the previous period, which is almost negligible.
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Tanganica.com Launch

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Looking at the Tanganica campaigns launched at the beginning of July, we see a significant increase in sales, namely more than 40 000 EUR. When we compare the minimum decrease in client campaigns (7%), we see incremental (additional) revenue, which is not negligible, without any spillover of traffic.COS from google/cpc for this period: 9.12%
‍COS from tanganica/cpc for this period: 8.95%

‍Revenue from google/cpc for this period in 2022: 396 059 €
‍Revenue from google/cpc for the period in 2021: 605 781 €
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‍YoY difference: — 34.60%
‍Sales from tanganica/cpc for this period in 2022: 136 697 €
‍google/cpc + tanganica/cpc in the period 2022 = 532 867 €
‍YoY difference: -- 12.80%

When we add up the peak season sales from Tanganica and the client's campaigns, we are only 12% smaller compared to last year, which was boosted by the pandemic. The YoY decline in sales of the entire store is more than 25%, and that means that thanks to Tanganica and additional sales, the decline in sales from paid Google was not so significant overall.