Seema Shah · November 2024
MMM: 3Q24 US QSR App Engagement and Advertising Trends
A recent E.coli outbreak has impacted digital traffic and sales on McDonald's as Sensor Tower data shows that US WAUs and downloads fell WoW. Reddit’s 3Q24 results exceeded top and bottom line expectations on increased efficiency in ad load delivery and user growth in markets where the company is actively translating english language content, both of which were corroborated by ST data.
Key Takeaways:
Per ST data, McDonald’s app users in the US were more likely to spend time on competing QSR apps, including SONIC (+2.7%), Chick-fil-A (+2%), and Chipotle (+2.7%) over the last 90 days. Over the past week, US app downloads have increased for the aforementioned restaurants, up 6%, 6%, and 1% WoW, respectively, which suggests that typical McDonald’s app users are turning to their preferred respective QSR chain in place of McDonald’s amidst worries of E.coli
McDonald’s quickly responded to the outbreak by pulling back on its ad spend, which declined 17% WoW as the E.coli outbreak became national news (10/19/2024-10/25/2024). Facebook, a channel that accounts for ~15% of McDonald’s ad spend saw the largest drop in spend, down -38% WoW
Reddit’s 3Q24 EPS and revenue smashed street estimates, driven by an uptick in advertising demand, increased efficiencies in ad load delivery and solid user growth. ST largely corroborates increases in ad load efficiency as US mobile app ads per session increased 71% YoY in 3Q24, a 2800bps increase vs 2Q24 YoY growth. This was in line with Reddit’s reported 3Q24 ad revenue growth, which increased 56% YoY, up 1500bps vs 2Q24 YoY growth
Reddit has observed strong user growth in markets where the platform is actively working to translate and roll out content with the help of machine learning. Through 4Q24 QTD, Reddit mobile app DAUs in Germany, Italy and Brazil are up 18%, 41% and 36% YoY, respectively
Similar to other social media networks, one of Reddit’s top advertiser verticals by US ad spend is the Shopping vertical (14%), which has doubled since 1Q24 (when it was 7% of total US ad spend), as timely summer sales events such as Amazon’s Prime Day and Target’s Circle Week likely propelled growth in the vertical
For more information, request the full report from reports@sensortower.com.
