John Miller wrote about this 1 year ago
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"95% of B2B buyers are not in the market for your products". Known as the "95-5 Rule", this "fact" has been making waves in B2B — but is it really the unshakeable truth it's made out to be?
I've been referencing that stat for over a year to illustrate that our go-to-market strategies have over-rotated into demand generation and performance marketing at the expense of brand building. We've focused on short-term metrics and quick wins, neglecting the importance of establishing a strong brand presence and cultivating buyer relationships over time.
The 95-5 "rule" is a great factoid, isn't it? 😁 It feels intuitively reasonable yet also surprising, validating the challenges many of us have been feeling: the increasing difficulty of cutting through the noise, engaging buyers, and driving pipeline.
But hold on! When did this become a "RULE", a universal law we all accept at face value? Just because a statistic is cited frequently and sounds authoritative doesn't mean we should blindly accept it.
This "rule" originates from a single paper published in July 2021, "Advertising effectiveness and the 95-5 rule", sponsored by the LinkedIn B2B Institute and written by John Dawes of the Ehrenberg-Bass Institute to investigate B2B advertising effectiveness
Notably, this paper didn't refer to specific research to come up with the 95-5 rule. Instead, it's a simple estimate based on average interpurchase time for a category. If your market only purchases once every 5 years, then in any year 20% will be in-market, and in any given quarter only 5%.
The author admits "The 95% figure is not meant to be a precise rule. We're using it as a heuristic..." But I'd argue they created a misperception by using "rule" in the title. And pundits like me have exacerbated the problem by referring to the 'finding' imprecisely.
This reminds me of another example from my own experience. In 2009 at Marketo, I conducted a test of our in-house lead nurturing, and wrote a blog to share the results: for the sample of leads I nurtured, I generated 50% more MQLs at 33% lower cost per MQL. Over time, though, this stat took on a life of its own, repeated as a universal truth, often misattributed. Today, if you search "lead nurturing 50% more leads", you'll see it incorrectly attributed as a universal fact to Forrester or Hubspot!
The moral? Whether we're talking B2B best practices or world information, there's often nuance behind headline statistics. As marketers and individuals, we should be careful how we use statistics.
Are you guilty of accepting or perpetuating "rules" like the 95-5 split without examining the data and context? If so, you're not alone. But by being more mindful and critical, we can make better decisions in our marketing strategies and lives."
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