Looking Back on My 2024 Brands to Watch
In recent years I’ve started the year by highlighting a few brands to watch. These are brands that are set up to have an interesting year, some poised for growth and others likely to struggle. Here is a look back at my 2024 picks and how things worked out.
Harvard
2023 was a rough year for Harvard as the school was attacked by critics for a variety of issues ranging from free speech to financial responsibility. President Claudine Gay stepped down at the start of 2024 and Harvard Provost Alan Garber was tapped to be the interim president.
The selection of a new Harvard president was likely to be intensely scrutinized as issues related to free speech and DEI complicated the choice.
So, what happened?
Harvard simply delayed the decision. The school dropped interim from Alan Garber’s title, but noted that a full presidential search would begin soon. Garber isn’t an interim president, but he also isn’t a long-term player.
I think the decision makes a lot of sense. How do you avoid offending people with a choice? You don’t make the choice.
It seems to have worked. As we begin 2025, things have stabilized at Harvard.
EVs
I wondered if mass-market EVs would struggle in 2024 and I was correct. Even Tesla saw a decline in sales.
The problem is that the value proposition for EVs isn’t particularly strong. High-end offerings can do well, leveraging exclusivity and branding. Mainstream offerings lack a compelling benefit. Now if prices fell dramatically things might shift, and Chinese firms like BYD are seeing gains in some places with very inexpensive EVs.
But this didn’t happen here: EVs aren’t dramatically cheaper than other cars and demand has weakened.
Shein
Discount retailer Shein was flying high at the end of 2023, heading for an IPO in 2024. As I anticipated, things haven’t gone particularly well and the IPO didn’t happen.
Shein’s business model is unique, but challenging. Selling clothes at ridiculously low prices can be done, but it is hard to generate a lot of profit. Competition is a huge problem and is likely to lead to falling prices, margins and profits.
In 2024, Shein continued to grow, but the pace has slowed and while the company doesn’t publish all its results, profits apparently have slumped. Temu is a particularly difficult competitor.
Shein is still planning on an IPO, perhaps in 2025, but this will likely be in London after U.S. politicians threatened to block the deal.
Apple
I anticipated that Apple would slow in 2024 as penetration gains of iPhone decloined and this was a good prediction.
Revenue was $391 billion in FY 2024, up from $383 billion in FY 2023, a gain of just +2%. Net Income was $94 billion, down from $97 billion prior year, a decline of -3.4%.
The results were pretty good given the circumstances. Two things are working in Apple’s favor. First, the brand has astonishing loyalty. People love Apple and once in the Apple world they aren’t likely to leave.
Second, Apple can continue to drive phone purchases through product improvements and replacements. I’ve come to believe that the battery is the key to it all. When the battery gives out, which it inevitably will, there is a big incentive to get a new phone.
Apple’s stock was nonetheless a huge winner, increasing from $191.6 at the end of 2023 to $250.4 at the end of 2024. One might wonder about valuations given the growth rate and the PE ratio of 41.
Nikki Haley
The only person who could stop Donald Trump was Nikki Haley and I anticipated she had a chance if Trump had a health issue or if Haley could own the concept of hope.
As it worked out, Trump’s health was fine and he survived the assassination attempt. He also held onto the hope platform. Trump’s campaign was all about marketing, employing two key strategies: focus on a benefit and create a foil. The benefit was a better economy, higher wages and lower inflation. The foil was illegal immigrants.
Protecting democracy and talk of fascist behavior just weren’t motivating benefits. I suspect few people have any idea what fascism is.
Bud Light
The fall of Bud Light continues to astound marketers, including me. I anticipated the brand would start to rebound in 2024 as the Dylan Mulvaney controversy faded from memory.
Apparently, things have stabilized for Bud Light, but the brand is not bouncing back yet. The negative perceptions remain, and Bud Light hasn’t managed to find a new message.
This is a good reminder that changing negative perceptions is easier said than done.
Stock Market
I was right on the direction of the stock market, but off on the magnitude. I thought stocks would rise, with the S&P 500 finishing at 5,057, up +6% from the 2023 close of 4,770. The actual results: 5,882, up +23%.
I’ll be back with my 2025 brands to watch next week.
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