Digital is sexy and everyone knows it.
Nearly every marketing plan and media strategy urges using ALL digital channels in hopes that an all-encompassing approach will be the secret sauce to drive sales and earn devoted, lifelong customers.
True, digital marketing has opened up massive opportunities for proving return on marketing investment through market segmentation, marketing attribution, and affiliate marketing.
However, rarely do we stop to ask, “Is it worth it?”
For example, was it worth it to pour $209 billion into digital in 2017, when for the first time in history, digital surpassed TV ad spend?
Or, is it worth it to spend $50,000 on a Spotify programmatic campaign (the starting price point for advertisers) when the only metric tracked is CPL (cost per listen)?
There is no way to retarget or attribute purchases to audio ads (after all, Spotify is a cookie-less environment).
Granted, it’s always been easier to follow the herd than to blaze our own path.
Nevertheless, Andrew Chen coined the law of shitty click throughs for good reason. The law follows a simple but powerful premise: over time, all strategies result in shitty click throughs.
Increased competition by other advertisers, the dulling of novelty for consumers (i.e. banner blindness), and more noise (i.e. harder to find qualified customers), click through rates will always drop significantly after a new channel is introduced.
Want proof?
I’ve gathered the CTR of the most popular digital marketing channels to dis-spell the marketing zeitgeist that display advertising is always the way to go when considering digital.
True to efficient market theory, if everyone knows the information, it’s already factored into the market.
The same applies to marketing: if everyone knows and uses the same 3-5 channels, the competitive advantage of all are wiped out and everyone is operating on the same playing field.
When we choose to not be innovative and unconventional, we pay for it both figuratively (and literally).
The next time a marketer pushes the concept of using saturated channels, pause and consider these average CTRs (click through rates):
- Display Ads: 0.05%-0.35%
- Social Ads (Facebook): 0.9%
- Social Ads (Instagram): 0.99%
- Social Ads (Twitter): 1.64%
- Social Ads (Reddit): 0.2-1.4%
- Social Ads (SnapChat, swipe up rate): 1-3%
- Search Ads (Google-Search Network): 1.91%
- Search Ads (Google-Display Network): 0.35%
- Average for select display, social, and search: 1.1%
That’s right, the average CTR for all digital advertising barely breaches 1%. Contrary to the early days of online advertising in the 90’s, CTR of display ads alone has diminished in power by at least 200% (the first display ad ever was by AT&T and had a CTR of 44%, albeit having very poor creative).
We’ve seen similar patterns for social and search channels as well.
Instead, if you really want to effecitvely use your budget, why not try utilizing underrated traditional marketing tactics or underdog digital channels? Average CTRs can be 10-15x higher than our overworked friends above and can be well worth the cost:
- Email: 3.42%
- Direct Mail (average open rate): 2.9-5.3%
- Mailing Lists: 2.4%
- Search Ads (Bing-Search Network): 2.83%
- Social Ads (Pinterest): 1.1%
Never rule out traditional marketing and runner-up competitors. Often, these neglected channels could be the way to effectively connect and resonate with your audience, reaching your marketing goal that much quicker.
That said, amazing creative and copy goes a long way regardless of your channel. Hence, the importance of always starting with an incredible product or service.
Save yourself a lot of migraines and ass-covering conversations in the future; develop a world-renowned product or service that’s worth talking about.
Phil Libin from Evernote knows it (delayed spending any money on marketing for years), Airbnb knows it (started with the “perfect experience” and worked backwards). Do you know it?
~JK