The Law of Shitty Clickthroughs
Over time, all marketing strategies result in shitty clickthrough rates
Andrew Chen observed a pattern across all digital marketing: channels that initially perform brilliantly inevitably degrade to mediocrity. The first banner ad on HotWired in 1994 had a 78% clickthrough rate. By 2011, Facebook banner ads averaged 0.05%—a 1,500X decline. This is not an accident but a law: over time, all marketing strategies result in shitty clickthrough rates.
Three forces drive this decay. First, customers respond to novelty, which inevitably fades as they develop pattern recognition and banner blindness. Second, first-to-market advantages never last because competitors quickly copy successful strategies using competitive intelligence tools. Third, more scale means less qualified customers as you exhaust early adopters who actively seek your product and must convince a mainstream market that needs much more persuasion.
The implications are profound for startups projecting growth: marketing metrics at small scale are fundamentally skewed positive. A 30% increase in customer acquisition cost combined with a 30% decrease in lifetime value can double the time to profitability, potentially killing a company. Chen argues the real solution is not incremental optimization but discovering the next untapped marketing channel while it is still uncontested.
- Over time, all marketing strategies result in shitty clickthrough rates
- Customers respond to novelty, which inevitably fades
- First-to-market advantage in marketing never lasts
- More scale means less qualified customers
- The highest vote of confidence for a new channel is that nobody has tried it yet
- Accept the Law as InevitableStop treating declining channel performance as a problem to fix and start treating it as a natural law to plan for. Review your current marketing channels and map their performance trajectory over the past 6-12 months. Identify which channels are in the novelty phase (high and rising), the plateau phase (high but flattening), and the decay phase (declining despite optimization). This mapping prevents you from over-investing in channels that are past their peak.Pro tipPlot your channel CTRs on a monthly basis going back as far as you have data—the decay curve will be unmistakableWarningDo not confuse seasonal fluctuations with structural decay—look at year-over-year trends, not month-over-month
- Maintain Base Performance Through RotationTake a nomad strategy: continuously develop new creative, test new publishers, and rotate messaging to slow the decay. This will not defeat the law but can push its effects from months to years. Rotating ad creatives is essential because even identical audiences develop banner blindness to static creative. Retargeter's analysis showed declining CTRs correlating directly with creative staleness.Pro tipSet a calendar reminder to refresh all ad creative every 4-6 weeks regardless of current performance
- Distinguish Information from AdvertisingThe law provides a litmus test: when you market with genuinely useful information, CTRs stay high because the content provides ongoing value. When your marketing is just novelty and noise wrapped in a new channel, it has a limited shelf life. Invest in content marketing, educational resources, and tools that serve your audience rather than just interrupting them with promotional messages.WarningDo not disguise advertising as information—audiences detect this quickly and the resulting backlash accelerates decay
- Scout and Pioneer New ChannelsThe 10X solution is discovering the next untapped marketing channel while competition is minimal. When someone asks Chen if anyone has tried a particular marketing approach and the answer is no, that is actually the highest vote of confidence—it means the channel is uncontested. Dedicate 10-20% of your marketing budget to experimenting with emerging channels even when your current channels are performing well.Pro tipThe best time to invest in a new channel is when your current channels are still working—you need runway to experimentWarningNew channels require patience—early results may be noisy before you find the right approach
The first banner ad in internet history appeared on HotWired in 1994 and achieved a 78% clickthrough rate. By 2011, Facebook banner ads averaged just 0.05% CTR—a 1,500X decline over 17 years. This dramatic decay illustrates the law in its most extreme form, driven by novelty fatigue, banner blindness, and advertiser saturation.
Chen demonstrated that with a single free query, anyone could discover that Airbnb was spending over $10,000 daily on search marketing, buying ads on 62,729 keywords, and competing with Expedia, Booking.com, Hotels.com, and Marriott. This transparency means any competitor can fast-follow Airbnb's entire search strategy within days.
Andrew Chen, now a partner at Andreessen Horowitz, coined this law while working in Silicon Valley's startup ecosystem around 2012. He noticed that every marketing channel he encountered followed the same decay pattern, from email open rates to banner ad clickthroughs. The name deliberately uses profanity to be memorable and to convey the inevitability of the phenomenon. Chen traced the pattern back to the very first banner ad in internet history, served on HotWired in 1994 with a 78% CTR, contrasting it with Facebook's 0.05% average CTR in 2011. His analysis of competitive intelligence tools like SpyFu showed how easily competitors could replicate any successful marketing strategy, accelerating the decay cycle.