What if in forcing the sales message, pushing that hard, we’re disregarding those people whose desire to purchase is there, but for whom there are barriers to completion at this point?
What would you say if we told you that 95% of your potential customers are not in the market for what you’re selling right now, but they will be? This is the 95-5 rule.
“The 95-5 rule, which shows that 95% of your potential buyers aren’t ready to buy today. This 95% are “out-market” today but will be “in-market” sometime in the future.”
What does this mean? It means your current attribution modelling, your sales funnel and your decision to pull anything from which you don’t see an instant return are no longer serving you.
Let’s explore how the 95-5 rule really impacts your marketing and what you can do to maximise your return on investment and encourage that 95% back when the time is right, for them.
The 95% and the death of the sales funnel
We’ve talked a lot about the traditional sales funnel becoming defunct. In summary, the digital landscape has, and continues, to change the way we shop. With information at our fingertips, and a progressive wave of e-commerce opportunities, sales can simply be a swipe away or may be a result of exhaustive research and we have to value each and every path to purchase.
With privacy and tracking changes making it harder than ever to attribute sales to a channel, we must look more holistically, and patiently at how our customers convert over time.
Our path to purchase doesn’t look the same as it did when the sales funnel was first introduced way back in 1898.
Yes, you read that right. Taking into account many twists, turns and alternative models, including the Hankins Hexagon and The Messy Middle, we’ve chosen to create our own, The Messy Hexagon. For us, the Messy Hexagon shows the most true to life version of our experiences with the digital sales funnel/process.
To successfully stay present and meet your customers on any point of this complex journey, you need to be visible, your marketing needs to be consistent and you need to be ready to invest in longer term conversions.
Understanding what influences a purchase
This is a vital part to accepting and working within the Messy Hexagon model - it’s knowing what can intercept and stall a purchase and what can encourage one along. There are more marketing touchpoints than ever, so it’s important to recognise what you’re up against.
In fact, this from Ruler Analytics says that: “Customer journeys are getting longer and longer. In fact, 52% of companies reported that they have sales cycles lasting up to 3 months, while 19% have sales cycles longer than 4 months.”
So, first we must understand what constitutes a touchpoint and then what the challenges and speed bumps are that can get in the way of that goal completion.
This is a lot of ways for a customer to find you or have their opinion about your brand reinforced (positively we hope). So how many touchpoints does it take to convert someone? Well, spoiler, it’s probably more than you think.
The same Ruler Analytics piece tells us that research indicates it could be an average of eight, but this is dependent on industry, so could be more.
The touchpoint journey is complex. Picture the scene, there’s a ‘nice to have’ item you want to own, but the car needs tyres, the bills need paying, so you save that social post screenshot, you think you’ll get it next month. Then someone mentions they have it and how great it is and it springs back to mind how much you still want it, so you go to the site, but decide money might still be tight, so you think, next month, or you wait to see if there’s a Black Friday deal.
In this scenario, you are and always have been a hot lead, a customer just on the brink of conversion, but the time wasn’t right. By the time you are ready to purchase, you have possibly interacted with upwards of four touch points over the course of several weeks or months.
Factors that may impact the sales journey include:
Time until payday
Seasonality (perhaps Christmas means your customers won’t be spending on themselves just now)
Research time need/significance of investment
Demand for the type of product in general
Economic stability or lack thereof (nationally)
If you take into account how this may vary for different industries, you start to see the value in thinking - and working - longer term. Decisions about purchases for small household items can take months, so scale this up to trips, holidays, cars and larger, big-ticket items and suddenly the journey through that Messy Hexagon could legitimately be a lot longer than you thought.
This is why your marketing needs to be built for this slow burn world. The hottest leads and the 5% in the market right now will buy, they’ll be your bread and butter. Don’t be complacent of course, we want to retain their attention too, but you’re focusing on converting that 95% when making campaign and budget decisions especially.
If you’re the company pulling ads after the first run because you didn’t see a return and scrapping campaigns after a week, you are failing to recognise their place in the path to purchase.
Reflect, refine yes, but don’t bolt because you didn’t see instant results; look at the graphs overall, the people buying now probably saw that ad you ran four weeks ago, and that UCG you used last week… breaking this cycle only damages your chances of being the brand they want when the time is right for them.
This doesn’t mean you can’t be careful, selective with your marketing if required, but it means stopping all together could do much more harm than good.
It is tempting to pull marketing in times of financial instability, it’s usually the first thing to go. However, people will always spend money, even if it’s less, so your presence is more important than ever to ensure they choose you when they do commit. We talk more about the importance of marketing during a downturn in another recent blog.
A quick note on attribution by marketing channel
These challenges are further complicated by the fact most channels have limited and varying attribution windows and settings, which means they may not be getting the credit for converting or consolidating sales which fall outside of those parameters.
For example, here are the default attribution settings for some common marketing channels:
Meta Ads - 1 day view or 7 day click is the default setting, but you can also select 1 day click, 7 day click, and 1 day click or 1 day view. They’ve recently re-introduced 28 day click attribution reporting (but ads can't be optimised for this...yet).
TikTok - click through can be set to 1, 7, 14 or 28 days, and view through can be set to 1 or 7 days.
Pinterest - this is known as a ‘lookback’ window and can be 30 days, 7 days or 1 day
LinkedIn Ads - The default view-through is 7 days and click is 30 days, but these can be customised to 1 day, 7 days, 30 days, or 90 days.
Google Ads - The default is 30 days, but it can be set to anything from 1 to 90 days. The window is set at the conversion level, so you can set different conversion windows for each action you are tracking.
Viewing this data in this context can sometimes lead you to think that your activity isn't working - remember we said that over half of companies in a recent report said their buying cycle is up to 3 months - that’s a big old gap.
Expected the unexpected
We can no longer assume - or in a lot of cases accurately track - where a sale has come from, so it’s time to embrace the Messy Hexagon, look at marketing outcomes over granular channel ‘data’ upon which we can no longer truly rely (on account of updated privacy and tracking legislation) and focus on being present for our audiences wherever possible.
If you’re looking to boost your success with the 95%, contact our team of digital experts today.