Why the 95:5 Rule is Revolutionizing B2B Marketing

In today's B2B marketing, there is often tremendous pressure: Every lead counts, and every conversion must happen as quickly as possible. Marketing teams are gauged by short-term KPIs, and your focus is nearly exclusively on capturing the few potential clients ready to make a purchase right now. But what if this approach is fundamentally flawed and ignores the greatest growth potential?

This is where the provocative yet evidence-based work of Professor John Dawes from the renowned Ehrenberg-Bass Institute for Marketing Science comes into play. His research challenges conventional wisdom and introduces the 95:5 rule: A simple yet transformative idea suggesting that at any given time, only about 5% of your potential B2B clients are actively seeking a solution in the market. The overwhelming 95% are part of your target audience but are not (yet) ready to buy.

A marketing strategy focusing solely on the "hot" 5% risks overlooking the vast growth opportunities present in this larger, currently "passive" segment. You’re competing in a crowded pond for few fish, while an ocean of potential future customers is largely ignored.

In this article, we dive deep into the 95:5 rule. We explore the problem of "now" obsession in B2B marketing, explain the scientific foundation of the rule, and most importantly, show you concrete, actionable strategies on how to adjust your marketing to not only serve the 5% but also win over the critical 95% for future success.

The Problem: The Dangerous Fixation on the "Immediate" 5%

Marketing and sales teams are under constant pressure to generate leads that quickly turn into revenue. This environment fosters an excessive reliance on bottom-funnel tactics:

• Performance Marketing: Paid search, retargeting.

• Sales Activities: Aggressive cold calling, direct approach via LinkedIn Sales Navigator.

• Content: Focus on product comparisons, case studies, demo requests.

All these efforts target the small group of the 5% actively seeking a solution. This fixation on the "now" carries significant drawbacks:

• Intense Competition: Every one of your competitors is vying for the same 5%. This drives up costs for keywords, ad space, and ultimately customer acquisition costs (CAC).

• Lack of Differentiation: Amid the hustle of bottom-funnel offers, it becomes increasingly difficult to stand out from the competition. Messages often sound very similar ("We boost your revenue," "Our software solves problem X").

• Missed Potential: The 95% not buying right now are overlooked. When these potential clients are ready to purchase in 6, 12, or 18 months, they may never have heard of your brand or formed no positive association with it.

• Weak Negotiation Position: If a buyer meets your brand only when deeply into the buying process and actively comparing options, your chances of winning the deal are statistically low. Brands that are familiar and trusted beforehand have a massive advantage.

Solely concentrating on the 5% is a reactive approach, which incurs high costs and leaves long-term growth potential untapped.

The Paradigm Shift: Understanding the 95:5 Rule

The 95:5 rule is not an arbitrary number but based on extensive research by the Ehrenberg-Bass Institute, known for its evidence-based marketing principles (including Byron Sharp’s bestseller "How Brands Grow"). The core message is simple but profound:

• 5% are "In-Market": This group has a recognized need, is actively researching, and is ready to make a purchasing decision in the near future.

• 95% are "Out-of-Market": This group belongs to your potential target audience (e.g., companies of the right size and industry) but currently has no need, urgency, or awareness of a potential problem. They are, however, your future buyers.

The key insight is: The 95% are not a lost group but your most important asset for future growth. If you manage to be present with this vast majority before they even think about a purchase, you have an unbeatable advantage when the need finally arises.

The Solution: Building Bridges to the 95% – Marketing for the Future

So how do you reach the 95% who are not actively listening right now? The answer lies in building Mental Availability. This concept, central to the Ehrenberg-Bass Institute's work, describes the likelihood that a buyer thinks of your brand in a relevant buying situation.

Imagine the CTO of a manufacturing company (part of your 95%) reading a technical article about production optimization. If your ERP systems brand comes to mind positively because he recently saw an interesting ad or a relevant post from you, you’ve created mental availability. Months later, when he is actually evaluating a new ERP system (and becomes part of the 5%), your brand is already positively anchored in memory.

How Do You Build Mental Availability?

• Broad Reach: You need to reach as many potential buyers within your category as possible, including the 95%. It’s about generating a large number of market contacts over time.

• Consistency: Brand building is a marathon, not a sprint. Regular presence over long periods is crucial.

• Distinctive Brand Assets (DBAs): These are the sensory and semantic cues that help buyers easily recognize and remember your brand without having to read the brand name. These include:

  • Logo

  • Color scheme (e.g., Telekom Magenta, IBM Blue)

  • Slogan or tagline

  • Jingles or sounds (e.g., Intel Inside)

  • Characters or mascots

  • Unique visual style in ads and content These DBAs must be used consistently to build strong memory structures.

• Linking with Category Entry Points (CEPs): CEPs are the various situations, needs, or problems that prompt a buyer to think about a specific product or service category. Examples in B2B:

  • "We need to reduce our production costs." (--> ERP system, automation solution)

  • "Our current software is outdated and no longer secure." (--> New software solution)

  • "How can we make our sales processes more efficient?" (--> CRM system, sales automation tool) Effective marketing links the brand’s DBAs with relevant CEPs in the target audience’s mind.

The 95:5 Rule in Practice: 4+1 Strategies for Your B2B Marketing

Based on the insights of John Dawes and the Ehrenberg-Bass Institute, specific recommendations arise:

1. Rethink Success Measurement: Look Beyond Immediate Sales

The greatest mistake is measuring the success of marketing activities—especially those targeting the 95%—solely by short-term sales or leads. If 95% of your audience cannot buy immediately, 95% of your efforts will inevitably have a delayed impact.

What You Can Do:

• Measure Brand Health Metrics: Track long-term indicators like unaided brand awareness (when asked "Which providers for X do you know of?", is your brand mentioned?), aided awareness, brand image, and recognition of your DBAs.

• Measure Reach: What percentage of your total addressable market (TAM) do you reach with your marketing activities over time? Is this percentage growing?

• Measure CEP Associations: (Advanced) Understand with which buying situations your brand is associated and if you occupy the most relevant CEPs.

• Accept Longer Periods: Building a brand takes time. Do not expect immediate miracles but track trends over quarters and years.

2. Prioritize Reach: Speak with More Potential Clients

Many B2B marketers believe in the power of high frequency—the assumption being that complex buying decisions require many touchpoints. However, Ehrenberg-Bass research shows this is often inefficient.

What You Can Do:

• Focus on "Unique Reach": Invest your budget so you reach as many different potential buyers in your category as possible, rather than targeting a few repeatedly. The first exposure to advertising often has the most impact on memory. Further repetitions have diminishing returns.

• Utilize Broad Channels (sensibly): In addition to targeted performance channels, broader reach channels can also be sensible in the B2B context, such as trade media, industry newsletters, relevant podcasts, LinkedIn brand awareness ads, YouTube, or even industry-specific events.

• Be Patient: It takes time to achieve broad market penetration.

3. Focus on New Clients: The True Growth Engine

A widespread misconception is that growth can mainly be achieved through more sales to existing clients (upselling, cross-selling). However, the data clearly show: The greatest growth potential almost always lies in acquiring new clients (penetration).

What You Can Do:

• Primarily Align Your Marketing with Acquisition: Indeed, customer retention is important, but most of the marketing budget and strategic efforts should aim at acquiring new buyers for the brand—reaching out to the 95%.

• Understand the Limits of Loyalty: Existing clients often have a natural cap on what they can or are willing to buy from you. Excessive efforts to yield more from them often result in low returns.

4. Build and Defend Distinctive Brand Assets

In a sea of often generic B2B messages, strong, recognizable brand elements are invaluable.

What You Can Do:

• Identify and Define Your DBAs: What makes your brand unique and recognizable? Is it your logo, colors, slogan, a specific visual style?

• Use Your DBAs Consistently: Deploy these elements across all marketing channels and touchpoints—from the website to ads to sales presentations.

• Resist the Urge for Frequent Rebranding: New marketing leaders often want to leave their mark by redesigning everything. This can be disastrous as it destroys memory structures built over years. Instead, strengthen and nurture your existing assets. Changes should be evolutionary, not revolutionary.

+1. Adapt Creativity and Messaging for the 95%

How Do You Talk to People Who Have No Immediate Buying Need?

• Be Interesting, Not Just Sales-Driven: Provide valuable content, insights, or entertainment relevant to the industry, even if it does not directly prompt a purchase.

• Focus on Branding: Use creative approaches to create positive associations and embed the brand in memory. Tell stories, show expertise, build trust.

• Link Yourself with CEPs: Communicate in which situations your solution is relevant to set the right triggers in the target audience's mind.

• Less Hard-Sell, More "Always-On": It’s about continuous presence and being perceived as a helpful and competent resource.

Balance Is Key: Not an Either-Or

The 95:5 rule does not mean neglecting performance marketing or serving the active 5%. Quite the opposite: An optimal approach combines both:

• Long-Term Brand Building (for the 95%): Investments in reach, DBAs, CEP linkage, and creative brand communication.

• Short-Term Activation (for the 5%): Efficient performance marketing activities, sales enablement, and conversion optimization to capture demand as it arises.

The art is to find the right balance and synergy between these two approaches instead of focusing on just one.

Conclusion: Think Long-Term, Act Strategically

The 95:5 rule by John Dawes and the Ehrenberg-Bass Institute is more than just an interesting statistic; it is a fundamental wake-up call for B2B marketing. It challenges us to rethink our obsession with immediate results and embrace a longer-term, more strategic perspective.

By consciously starting to advertise for the 95%—through building mental availability, prioritizing reach, focusing on acquiring new clients, and consistently using distinctive brand elements—you lay the foundation for sustainable growth. You reduce the reliance on expensive bottom-funnel battles and increase the likelihood that your brand will be the first choice when your future clients are finally ready to buy.

It’s time to end the chase for the 5% and start cultivating the ocean of the 95%. Your future self (and your sales team) will thank you for it.

Sources and Inspiration

This article is significantly inspired by the work and publications of Professor John Dawes from the Ehrenberg-Bass Institute for Marketing Science. His research on the 95:5 rule and the principles derived for effective marketing, especially in the B2B context, presents a valuable, evidence-based challenge to traditional marketing approaches. We encourage all marketing professionals wanting to dive deeper into this matter to engage with the publications and discussions by Professor Dawes and the Ehrenberg-Bass Institute to gain a more comprehensive understanding of long-term successful brand management.