Buying decision: what the 95:5 rule reveals about the consumer

The buying decision does not depend solely on persuasion: above all, it depends on whether the consumer is in the market. According to the 95:5 rule, formulated by John Dawes of the Ehrenberg-Bass Institute, up to 95% of potential buyers in a category are not in the market at any given time. The implication is direct: advertising functions less as an immediate conversion trigger and more as memory building, which will be activated when the buyer finally enters buying mode.

Summary

• The 95:5 rule, published by John Dawes (Ehrenberg-Bass Institute) with the LinkedIn B2B Institute in 2021, estimates that up to 95% of buyers in a category are not in the market at any given time.
• The number originates in the B2B market: companies switch service providers, such as their primary bank or law firm, on average once every five years, leaving around 5% of them in the buying process per quarter.
• The rule is a heuristic, not an exact measurement. The proportion varies according to the average inter-purchase period of each category.
• Campaigns focused solely on conversion speak to the minority ready to buy and ignore the mass that sustains long-term growth.
• Category Entry Points (CEPs) are the situations that trigger consumers to think about a category. Strong brands are remembered in more of these entry points.
• Building mental availability takes years: according to Dawes, reaching double-digit association with CEPs is a multi-year effort, and even market leaders rarely exceed 50%.
• Building that recall requires the triad of consistency, frequency, and reach.

What the 95:5 rule is

The 95:5 rule states that, for many products and services, up to 95% of people or companies are not in the market at any given time. It was formulated by John Dawes, professor and associate director of the Ehrenberg-Bass Institute for Marketing Science, in an article published in 2021 in partnership with LinkedIn's B2B Institute.

The origin of the number is corporate buying behavior. Companies switch service providers, such as their primary bank or law firm, on average once every five years. This means that only 20% of corporate buyers enter the market over an entire year, or roughly 5% in a quarter. Put another way: 95% are not in the market.

Dawes himself notes that the number is not a precise rule, but a heuristic: a shortcut to communicate that the vast majority of buyers, in most categories, are not in the buying process during a specific period. The exact proportion varies by category, but the logic applies whenever the inter-purchase period is long, both in B2B markets and across many consumer categories.

Inter-purchase period and decision window

Two concepts help dimension how many buyers are in the market at any given moment:

• Inter-purchase period (inter-purchase period): the average time a category buyer takes to buy again or switch providers. This is the baseline for calculating the 95:5 rule. If a category has an average two-year interval between purchases, 50% of buyers enter the market over a year, or about 13% per quarter.
• Decision window (decision window): the time a buyer remains "in the market", researching and comparing, until completing the purchase.

The combination of the two defines the real size of active demand. Categories with long inter-purchase periods and short decision windows have, at any moment, a small fraction of active buyers. A simple survey asking how often customers buy from the category can already estimate this proportion.

Why speaking only to those who are ready limits growth

If the majority of the audience is not in the market, these people are not researching, not comparing solutions, and not thinking about the category. They are living their routines with other priorities. No sales argument will turn this group into immediate buyers.

This is the central misconception of much conversion marketing: the premise that everyone is always ready to buy and only hasn't bought because they haven't been persuaded enough. Effectiveness consultants mock this expectation: the idea that simply nurturing the lead and explaining product benefits more clearly will cause buyers outside the market to leap into the decision window is not supported by how people actually buy.

There is also a mathematical ceiling: if only 5% or 10% of category buyers are in the market during a period, there is a limit to how many customers any campaign can win in that window. A campaign can increase a brand's share among those already buying, but it cannot bring people into the market who simply aren't in it.

The practical consequence is well known: in the rush for immediate results, brands concentrate their budget on campaigns that talk only to the 5% ready to buy, leaving aside the mass of consumers that holds the potential for long-term growth.

What the rule changes in advertising

If advertising mostly reaches people who will not be buying anytime soon, it cannot function primarily as a purchase stimulus. According to Dawes, it works mainly by building and refreshing memory links with the brand—links that are activated when the buyer enters the market.

Targeting ads only to those showing purchase intent has another limitation: people buy primarily based on memory and, when researching, strongly prefer brands they already know. Unfamiliar brands have lower consideration rates and much lower click-through rates than familiar brands. Anyone showing up only at the search stage arrives at the moment of decision as a stranger.

Category Entry Points: where brand recall is built

The main function of the brand team, beyond supporting immediate sales, is to build and refresh mental connections between the brand and the contexts in which it can be relevant. These contexts are Category Entry Points (CEPs): the moments, needs, and situations that cause consumers to think of a category and the brands within it. The concept was developed by Jenni Romaniuk and Byron Sharp of the Ehrenberg-Bass Institute and is central to How Brands Grow: Part 2 and Better Brand Health.

A strong brand is one that comes to mind easily in these moments. This recall does not happen by accident: it is the result of prior, consistent, and intentional investment in branding. In this sense, branding is neither aesthetics nor institutional campaigns. It is the ability to occupy space in consumer memory before an intention to buy even exists—what can be described as engineering mental availability.

According to Romaniuk and Sharp, brands grow when they associate repeatedly with multiple CEPs, not when they deepen their relationship with a single context. A CRM software that communicates only in sales contexts, for example, reduces its chances of being recalled because team expansion, onboarding, restructuring, or leadership changes are also contexts that trigger the same category.

Quick definitions

• 95:5 rule: heuristic stating that up to 95% of buyers in a category are not in the market at any given time.
• Inter-purchase period: average time a buyer in the category takes between one purchase and the next.
• Decision window: time during which the buyer remains actively in the market until completing the purchase.
• Category Entry Point (CEP): moment, need, or situation that leads the consumer to think about the category.
• Mental availability: ease with which the brand comes to mind in buying situations within the category.

Consistency, frequency, and reach

It is very difficult to build a brand without the triad of consistency (saying the same thing), frequency (all the time), and reach (to as many category buyers as possible). People forget brands easily, and memories must be continuously refreshed, including among those who won't be buying anytime soon.

Dawes' data shows the scale of the task: reaching double-digit mental availability, measured by brand links to CEPs, is a multi-year effort. Many well-established brands don't exceed 20% to 30% of respondents associating the brand with a CEP, and even market leaders typically reach around 50%. Construction is cumulative: it requires time, budget, patience, and good media choices.

There is a valuable counterpart to this effort: brands that build mental availability in the minds of potential buyers gain a lasting advantage, because competitors face immense difficulty catching up later. This also guides media planning: concentrating the entire budget in one quarter means being off the air for the rest of the year, missing buyers who will enter the market in subsequent periods.

When the customer enters buying mode, they will remember a brand. The strategic question is ensuring it's yours, and that is decided long before the decision window, with long-term vision and the willingness to resist the short-termism dominating digital marketing.

How to apply

1. Calculate how many buyers are in the market: estimate the average inter-purchase period of the category through internal data or a simple purchase frequency survey, and derive the proportion of active demand per period.
2. Separate activation and brand building roles: maintain conversion campaigns for active demand, but reserve continuous investment to build memory among those who aren't ready to buy yet.
3. Map category entry points: list the moments, needs, and situations that cause consumers to think about the category and prioritize the most frequent and relevant.
4. Associate the brand with multiple CEPs: distribute communication across different entry contexts rather than repeating the exact same one.
5. Sustain consistency, frequency, and reach: coherent message, continuous presence, and broad coverage of category buyers with budget distributed throughout the year.
6. Adjust timeline expectations: treat mental availability as an asset that accumulates over years, tracking brand metrics over time rather than treating it as the output of an isolated campaign.

Sources: John Dawes, "Advertising Effectiveness and the 95-5 Rule: Most B2B Buyers Are Not in the Market Right Now" (LinkedIn B2B Institute, 2021). On Category Entry Points: Jenni Romaniuk e Byron Sharp, "How Brands Grow: Part 2" (Oxford University Press, 2016).