The LikeFolio Outlier Grid displays Purchase Intent (PI) Mention growth on the x-axis and Consumer Happiness on the y-axis. The ideal positioning is in the top right corner, indicating a potential bullish opportunity:
SMWB is outperforming software industry players in terms of consumer demand while maintaining high levels of happiness.
Although SimilarWeb has one of the smallest levels of mention volume of the compared companies (indicated by relative dot size), the Outlier Discovery Grid shows that SMWB is growing faster than other software industry names while maintaining a high level of Consumer Happiness.
Demand Climbs to New Heights
Consumer Purchase Intent (PI) Mentions of using or subscribing to a Similarweb data solution are at an all-time high — and up 98% year-over-year on a long-term basis:
Businesses are increasingly using AI-driven data analytics to research market trends and competitors and to target potential customers.
Many developers are actively seeking large datasets to use to train AI tools.
Comprehensive SMWB demand was up 28% year-over-year in the first quarter, marking the eighth-consecutive quarterly jump. A widening gap between SMWB consumer demand and its share price has created an ideal investment opportunity.
A growing number of social media posts are referencing Similarweb's website traffic stats and unique user insights. In April 2023, SMWB mentions spiked after the company reported that Coinbase leads other crypto exchanges in U.S. web traffic (by a wide margin) amid the platform's spat with regulators.
A Happy, Diverse Customer Base
Similarweb's Consumer Sentiment mentions are 88% positive over the past year:
SMWB is meeting a growing need for real-time market intelligence as businesses seek an edge in a more competitive post-pandemic economy.
Its solutions are used by 4,000-plus customers across many industries including retail, travel, media, and pharmaceuticals. Over half of the Fortune 100 and all “Big 6” marketing agencies are SMWB customers.
Artificial Intelligence Has Arrived
Consumer buzz related to artificial intelligence usage and the capabilities of AI technology is up 84% quarter-over-quarter and an astounding 426% year-over-year on a 90-day moving average:
LikeFolio's consumer data provides a zoomed-out view of the trends driving consumers' main focus when considering software and data analytics solutions over the past year:
The success of ChatGPT is rapidly ushering in a new era of artificial intelligence (AI) and machine learning (ML) technologies. Nvidia CEO Jensen Huang recently noted that generative AI capabilities are causing companies to urgently reimagine their products, calling today “the iPhone moment of AI.”
Search engines are also becoming an increasingly important tool for consumers. Since 93% of all website traffic starts from a search engine, businesses are seeking software that can visualize comprehensive digital information.
The Bottom Line
Artificial intelligence is red hot and powered by big data. AI-powered chatbot ChatGPT has made artificial intelligence accessible to the everyday user — and its launch set off an arms race between Microsoft, Google, and other tech giants. The breakthrough of generative AI capabilities is forcing companies to re-evaluate their business models, product development, and approach to targeting customers.
Similarweb's AI-driven software solutions are positioned to win. We expect that there will be a TON of companies across retail, travel, logistics, and other industries looking for digital datasets to train on over the next few years. SMWB has many choices related to marketing, research, sales, and shopper intelligence. The Tel Aviv-based company analyzes data from one billion-plus websites and over 8 million apps across 3 million brands and more than 200 categories.
LikeFolio data around SMWB is strengthening. Greater use of Similarweb's data insights is driving more frequent social media discussion. Businesses are citing unique stats that give them valuable insight into their markets, competitors, and customers. SMWB Purchase Intent Mentions have doubled year-over-year while sentiment remains remarkably high.
SMWB has strong momentum heading into next month's earnings. The company is coming off a year in which revenue grew 40%, customer count surpassed 4,000, and average annual revenue per customer increased. The company reports its first-quarter results in mid-May 2023, and the recent spotlight on AI data analytics and strong LikeFolio data suggest a bright outlook is forthcoming.
Summary
Similarweb provides businesses of all shapes and sizes with valuable digital datasets to power decisions. We see demand for its software taking off over the next few years as companies scramble to train chatbots and enhance their AI capabilities. There is an evolving disconnect between social media buzz and share price that could start to be reconciled as soon as next month's update. With the stock down more than 70% from its May 2021 IPO, this has presented a bullish opportunity to invest in a clear beneficiary of AI growth.
TradeSmith is not registered as an investment adviser and operates under the publishers' exemption of the Investment Advisers Act of 1940. The investments and strategies discussed in TradeSmith's content do not constitute personalized investment advice. Any trading or investment decisions you take are in reliance on your own analysis and judgment and not in reliance on TradeSmith. There are risks inherent in investing and past investment performance is not indicative of future results.
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