The 95:5 rule isn't meant to be interpreted literally, but it's valid in a general sense. At any point in time, virtually all B2B companies have many more out-of-market prospects than in-market prospects.
In a 2021 paper published by The B2B Institute, Professor John Dawes with the Ehrenberg-Bass Institute for Marketing Science argued that the 95:5 rule has major implications for B2B marketing. He wrote:
"To grow a brand, you need to advertise to people who aren't in the market now, so that when they do enter the market your brand is one they are familiar with. And that they mentally associate your brand with the need or buying situation that brought them into the market."
The rationale for marketing to out-of-market prospects is ultimately based on the importance of the initial consideration set in B2B buying.
In most cases, a B2B buying process begins when an event (a trigger) causes a business person (the potential buyer) to perceive a need or desire to potentially buy something.
When such a need or desire arises, a potential buyer will quickly create a mental list of companies, products, or services (which I'll refer to collectively as brands) that he or she feels are worth considering, i.e. an initial consideration set.
This initial consideration set is based on the mental impressions of brands the buyer has already formed through a variety of touchpoints, such as his or her experience with a brand, marketing messages, news reports, and conversations with colleagues and friends.
Research has shown that companies in a potential buyer's initial consideration set are more likely to win business from the buyer than companies not in the initial consideration set. (See, for example, this study by WSJ Intelligence and B2B International.)
The immediate goal of B2B marketing programs designed for out-of-market buyers should be to build and refresh memory links to your brand in the minds of your potential future buyers. Your ultimate objective is to be included in your potential buyers' initial consideration sets. However, not all memory links are equally effective for this purpose.
When marketing to out-of-market buyers, your most important objective should be to increase the mental availability of your brand.
The concept of mental availability was developed by Byron Sharp and his colleagues at the Ehrenberg-Bass Institute. Many B2C marketers are familiar with the idea of mental availability, but it hasn't been used widely in B2B marketing.
In his landmark 2010 book, How Brands Grow, Byron Sharp provided a simple definition of mental availability: "Mental availability/brand salience is the propensity for a brand to be noticed or thought of in buying situations."
Sharp also described the importance of mental availability in clear terms: "The key marketing task is to make a brand easy to buy; this requires building mental and physical availability. Everything else is secondary."
Mental availability is different from general brand awareness. Mental availability describes the likelihood that a potential buyer will think of your brand in the context of a specific buying situation.
As I noted earlier, when a potential buyer perceives a need or desire that might require buying something, the buyer will use his or her memories to create an initial consideration set of brands that might be able to address the need or fulfill the desire.
This initial consideration set will include brands that the potential buyer mentally associates with the specific need or desire he or she is experiencing. It's these associations - based on memories - that create mental availability.
When marketing to out-of-market buyers, therefore, your job is to build and refresh the memory structures that connect your brand to the specific needs or desires your potential buyers are most likely to experience.
My use of the plural (needs and desires) in the preceding sentence was intentional. Many B2B companies offer products or services that can address several needs. For example, a B2B technology solution may enable a buyer to reduce or eliminate several kinds of costs and improve the speed or efficiency of several work processes.
A potential buyer will create his or her initial consideration set based on the specific need the buyer is experiencing. Different needs or desires (and the context in which they arise) will evoke different initial consideration sets.
You can't predict what specific need will cause a particular buyer to move into the market for a product or service like the one your company offers. Therefore, to increase mental availability, you need to build and refresh the memory links that will connect your brand to all of the important buyer needs that your product or service can address.
With broader mental availability, you increase the likelihood that your brand will be included in the initial consideration set of a larger number of your potential buyers.
Increasing mental availability and being included in the initial consideration set of a larger number of potential buyers won't guarantee success. The rest of the B2B buying process still matters. But being included in more initial consideration sets will help.
As I wrote in my earlier article: You have to be invited to the party before you can be asked to dance.
Image courtesy of Erdonzello via Flickr (Public Domain).
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