The Data Behind 2025's Ecommerce Winners and Losers: Northbeam x Operators Breakdown

The Data Nobody Else Has

Austin Harrison, CEO of Northbeam, brought exclusive advertising data to the Operators podcast that paints a stark picture of who won and who lost in 2025. Northbeam processes attribution data across thousands of ecommerce brands, giving them a unique bird's-eye view of where money is flowing and what's actually working.

The headline numbers are dramatic — and the implications for 2026 strategy are significant for any brand operator.

The Winners: Where Money Flowed in 2025

AppLovin: +176% Year-Over-Year Spend

The biggest story in performance marketing last year wasn't Meta or Google — it was AppLovin. Brands collectively increased their AppLovin spend by 176% year-over-year, making it the fastest-growing ad platform in ecommerce. The reason: AppLovin's machine learning models deliver strong ROAS for product-focused brands, particularly in the $20-80 price range where impulse purchases are common.

For brands not yet testing AppLovin, the data suggests the window of early-mover advantage is still open — but closing. As more brands flood the platform, CPMs will rise and efficiency will normalize.

AI Search Traffic: +1,000%

Traffic from AI-powered search (ChatGPT, Perplexity, Google AI Overviews) grew by 1,000% year-over-year. But before you rewrite your entire SEO strategy, context matters: AI search still represents a tiny fraction of total ecommerce traffic. The percentage increase is dramatic because the baseline was nearly zero. It's a signal to watch, not a channel to bet on yet.

The Losers: Where Money Disappeared

Snapchat: -46% Spend

Brands pulled nearly half their Snapchat ad spend in 2025. The platform's advertising product hasn't kept pace with TikTok and Meta, and its user demographics skew too young for many ecommerce brands' target customers. Unless Snapchat makes significant improvements to its ad platform, the exodus will likely continue.

Small Brands Under $5M: Revenue Declined

Perhaps the most sobering data point: brands under $5 million in annual revenue saw revenue decline on average, while brands above $100 million grew 15%. The ecommerce landscape is consolidating. Larger brands have the resources to invest in AI creative, multi-channel distribution, and sophisticated data infrastructure. Smaller brands are being squeezed by rising ad costs and increasing competition.

The AI Creative Prediction

Harrison and the Operators hosts agreed on one prediction for 2026: infinite AI-generated creative will separate winners from everyone else. The brands that can produce hundreds or thousands of ad variations, test them rapidly, and scale winners will have a structural advantage that manual creative teams can't match.

This doesn't mean human creative directors become irrelevant — it means they become creative strategists who direct AI systems rather than producing individual assets. The role shifts from "make this ad" to "set the parameters for what this AI should explore."

Key Takeaways for 2026 Strategy

1. Test AppLovin now. The 176% spend growth signals real results, but efficiency will decrease as more brands enter. Early movers benefit most.
2. Don't abandon Meta. Despite the narrative, Meta remains the largest paid channel for most ecommerce brands. It's expensive but proven.
3. Invest in AI creative production. The data supports Holiday's point from the other episode: AI creative is becoming a structural competitive advantage.
4. Monitor AI search but don't over-invest. 1,000% growth sounds massive, but the absolute numbers are still tiny. Optimize for it passively but don't redirect major resources.
5. If you're under $5M, find your moat. The data is clear that small brands are struggling in the current environment. Differentiation, community, and operational efficiency matter more than ever.

Source: Operators podcast.