Just ask the Ehrenberg-Bass Institute.
The Institute for Marketing Science founded the 95:5 Rule. This is a marketing concept that suggests that at any given time, only 5% of consumers in a market are actively looking to buy a product or service, while the remaining 95% are not currently in the market. This principle challenges traditional sales-driven marketing approaches and emphasizes the importance of long-term brand building.
The key insights from the 95:5 Rule
- Most consumers aren’t ready to buy now. Instead of focusing only on immediate sales, businesses should invest in brand awareness to ensure they are remembered when consumers are ready to purchase.
- Short-term performance marketing is limited. Campaigns targeting the 5% may generate quick sales, but long-term success comes from consistent, broad-reach brand building.
- Emotional branding is crucial. Engaging content and advertising build familiarity and trust, increasing the chances of being chosen when consumers enter the market.
- Category Entry Points (CEPs) matter. Marketers should ensure their brand is linked to key buying triggers (e.g., needing a new laptop for work) to stay relevant when purchase decisions are made.
What does this mean for marketers?
Instead of just chasing immediate conversions, businesses should balance brand-building efforts (targeting the 95%) with activation campaigns (targeting the 5%).
Businesses must stay top of mind – so when the 95% are ready to buy, they choose their brand.
Applying the Ehrenberg-Bass Institute’s 95:5 Rule to your marketing strategy means shifting focus from just immediate sales to long-term brand growth. Here are some ways that you can use it effectively:
Prioritise brand awareness for the 95%
Since most potential customers aren’t ready to buy today, your goal should be staying visible and memorable so that when they do enter the market, they choose you.
- Invest in broad-reach advertising: Use digital, TV, social media, and out-of-home ads to reinforce your brand over time.
- Tell a compelling story: Emotional branding and consistent messaging help build familiarity and trust.
- Use Category Entry Points (CEPs): Align your brand with key buying triggers (e.g., “When I need a lawyer for a personal injury claim, I think of Coles Miller”).b
Maintain your short-term sales activation for the 5%
While long-term brand building is essential, you also need targeted marketing for those ready to buy now.
- Use performance marketing strategically: PPC ads, retargeting, and SEO capture active buyers searching for your services.
- Optimise for conversions: Ensure your website is easy to navigate, with strong CTAs and social proof to encourage action.
- Offer promotions wisely: Discounts or time-sensitive offers can help nudge the 5% toward purchasing without undermining your long-term brand value.
Balance your marketing spend
A common mistake is putting too much budget into short-term activation at the expense of brand building. Research suggests an optimal split is around 60% brand-building and 40% activation for sustained growth.
Provide content marketing for both audiences
- Educational Content (For the 95%): Blog posts, guides, and videos build brand authority and keep you relevant.
- Conversion-Focused Content (For the 5%): Case studies, testimonials, and clear service pages help close deals.
Be the brand that they remember!
If your marketing is only focused on the 5% who are ready to buy today, you risk losing out on the much larger audience who will be ready in the future. By building awareness and trust with the 95%, your brand will be top of mind when they need you.
How is your brand recognition? Do people remember your logo? Can they recall your tagline? Can they pick up your brand colours on the Pantone © chart? Can they tell a small group exactly what your brand offers?
If not – you might miss out on the 5% in market. Is it time to spend more on your brand recognition?
Learn about brand recognition and more at marketingSHOWCASE. Get your FREE tickets today. Next event is at the Aintree Racecourse, Liverpool. Register here
