The Law of Shitty Clickthroughs

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Welcome to the Law of Shitty Clickthroughs:

Over time, all marketing strategies result in shitty clickthrough rates.

Here’s a real example – let’s compare the average clickthrough rates of banner ads when debuted on HotWired in 1994 versus Facebook in 2011:

That’s a 1500X difference.

The clickthrough rates of banner ads, email invites, and many other marketing channels on the web have decayed every year since they were invented.

New channels offer high performance, because of a lack of competition, big opportunities for novel marketing techniques, and these days, the cutting edge is about optimizing your mobile notifications, not your banner placements.

Few drivers for the Law of Shitty Clickthroughs:

  • Customers respond to novelty, which inevitably fades
  • First-to-market never lasts
  • More scale means less qualified customers

Novelty

When HotWired showed banner ads for the first time in history, people clicked just to check out the experience. Same for being the first web product to email people invites to a website – it works for a while, until your customers get used to the effect, and start ignoring it.

Humans seek novelty yet are pattern-recognition machines. Your initial marketing strategy will work quite well as your users try it for the first time, but afterwards, they learn to filter your marketing efforts out unless they are genuinely useful

First-to-market never lasts

It’s bad enough that your own marketing efforts drive down channel performance, but usually once your marketing efforts are working, your competitors quickly follow. There’s a whole cottage industry of companies that provide competitive research in the area of how their competitors are advertising and give you the information needed to fast-follow their marketing efforts.

More scale means less qualified customers

Another important way to think about the available market for your product is in terms of the popular Technology Adoption Lifecycle (TAL), in which early adopters actively seek out your product, while the rest of the mainstream market needs a lot of convincing.

Once you get past the early adopters group, the CTRs can drop substantially.

How to fight the Law of Shitty Clickthroughs

This law provides a litmus test as to the difference between advertising and information. When you are marketing with useful information, then CTRs stay high. Advertising that’s just novelty and noise wrapped in a new marketing channel has a limited shelf life.

The real solution: Discover the next untapped marketing channel

In addition to doubling down on traditional forms of online advertising like banners, search, and email, it’s important to work hard to get to the next marketing channel while it’s uncontested.

Sometimes I get asked “have you ever seen someone do XYZ to acquire customers?” Turns out, the highest vote of confidence I can give is, “No I haven’t, and that’s good – that means there’s a higher chance of it working. You should try it.”

Today, these (relatively) uncontested marketing channels are Open Graph, mobile notifications, etc. If you can make these channels work with a strong product behind it, then great. Chances are, you’ll enjoy a few months if not a few years of strong marketing performance before they too, slowly succumb.