Thanks! I am not sure how to look at ISPs of the visit. As far as email newslrtter, it was always done with mailchimp and tracked as such I believe (in campaigns).

Well yes and no. It depens on the time frame. We have seen a drop of traffic all over recently (after the new panda/penguin updates) but at the time the switch occured (Sept 21 2011) and for several months after that, other traffic types were up which was consistent with what we were experiencing before the direct traffic drop. No switch in sources.

Direct traffic starts dropping overnight sept 21st
Referrals start dropping about Oct 18th
Organic search is up and doing fine the entire time, but not showing a spike

Now numbers are different, but the environment is different, which is why I choose to look back at last Fall to try to identify what happened.
Hubby is looking into services we might have stopped using that might have been the cause..

Hi, yes I mean actual direct traffic , not search related. No outside mktg was done so it cannot be that. Newsletter increased since then, so not that either.

Search on brand term is doing ok, but direct traffic is WAY down. 
I thought it could be the way google assigns direct now vs then.. But cant find any info to substantiate that. I would accept a double digit drop but the fact it happens overnight, just seems weird..

I am attaching the graph to show what I mean...

QCkRW

Hmm.. Well It is not that It is just surfacing, it is just that I am asking around only now

I have a sitemap and no problem for page indexation. The pages that are losing the most traffic are still indexed. no issue with that.
We also have no errors 400 or 500 recorded on GWT..

Given we apparently had a previous SEO dude use link exchange network on us (yeah I know nothing better than getting f**ked and paying for it)  we do fall in the penguin a bit and did fall a bit in the panda updates, but more in a slow manner, losing positions one at a time, rather than being dumped to page 5 or 40 overnight. Though I dont see what that would have to do with direct traffic loss??

I have been seeing a trend for a while that is intesifying.

My direct traffic numbers are down A LOT. We are not down 50% to LY (in actual number not just percentage of traffic)

I am trying to understand what could be the causes of this issue.

I was considering simply bigger meaner competition, but I actually perform decently on my returning customers.  Also my performance on my brand keyword is more inline with my current trend so I would except these KW to do equally as bad if the actual brand/store was the issue.

The more surprising even, is the fact that I can trace back the start of the trend exactly to the day. Overnight on Sept 22 LY direct traffic went down 30% (to LY) when it was trending UP 20-25%(to LY) before.

Now, we did do a redesign of the website on May 2011 (4 months before the drop), and did change host Oct 2011 (a couple weeks after the start of the trend).

Do you have any clue as to why this could be happening?

Did GA start tracking direct traffic differently?
Any thoughts?