The 95/5 Rule: Why Advertisers Should Stop Fishing in a Puddle

We found this article from Creative Resources’ Sally Beamer & Gerry Tabio,“The 95/5 Rule” (Inside Radio, 2/13/2025), and adapted it with their kind permission. 

When Bob woke up, a plumber was the last thing on his mind. Two minutes later he was standing in an ice-cold shower, and two minutes after that he was staring at a lake of water spreading across his basement floor from a ruptured water heater. In the span of a morning, Bob went from “not in the market” to “in the market.” And here's the question every advertiser should be asking: when Bob finally reached for his phone, whose name did he already know?

That transition—from not buying to buying—happens in every category, every day, to people who weren't thinking about you a moment earlier. It points to a reality that should shape how you spend every advertising dollar. At any given moment, only about 5% of the potential buyers in your category are actually in the market. The other 95% are living their lives, thinking about anything but your product. This is the 95/5 rule, documented by Professor John Dawes of the Ehrenberg-Bass Institute for Marketing Science, and if you're an advertiser, it changes the math on nearly everything you do.

You've Been Fishing in the Puddle

Line up 100 potential customers for almost any category and they'll share a profile. For residential plumbing, they're all homeowners. But only five of them need you right now. The other 95 are future demand—real, valuable, and completely ignored by most advertising budgets.

The temptation is obvious. The 5% are easy to find, easy to convert, and easy to measure. They're searching, clicking, and calling today, so the return shows up fast and clean in a dashboard. That's the bottom of the funnel, and advertisers have loved it since the first ad ran over a century ago. The problem is that when you pour your entire budget into the 5%, you're fishing in a puddle while ignoring the ocean. Worse, so is every competitor, which is why acquisition costs in that puddle keep climbing.

The 95% aren't reachable with a call to action, because they have no action to take yet. Bob couldn't have been “converted” on a plumber the day before his water heater failed. But he could have been made familiar with one. That distinction is the whole game.

Be Known Before You're Needed

The trigger moment—the A/C unit failing in July, a parent's fall that suddenly requires home care, the office network going down in the middle of the day—is almost always unpredictable. You rarely know when a given customer will cross from the 95% into the 5%. What you can control is whether your brand is already in their head when they do.

At the trigger moment, customers overwhelmingly give first consideration to a brand they already recognize and trust. Familiarity breeds affinity, and affinity is built long before the purchase, during what we at 2060 Digital call the Seeing & Hearing phase of the customer journey. This is the window where you're not selling anything today—you're planting your name so it's the first one that surfaces tomorrow. If you wait until the trigger moment to introduce yourself, you've already lost to the competitor who showed up early and often.

This is the heart of 2060’s Connected Performance™ approach: brand-building and intent capture aren't rivals competing for the same budget. They're two halves of one system. Brand creates the demand; capturing intent closes the sale. Skip the first and that spend works far harder for far less, because you're trying to convert people who've never heard of you.

AI Search Just Raised the Stakes

If the 95/5 rule made brand-building important, AI search makes it urgent. Google's AI Overviews and AI Mode—along with standalone AI assistants like ChatGPT and Perplexity—increasingly answer questions directly instead of sending people to a page of links. That compresses or eliminates the old research phase, where a buyer clicked through several websites comparing options. When those AI answers appear, click-through rates drop sharply.

Think about what that means for the trigger moment. When Bob's search returns a tidy AI-generated answer instead of a page of ten blue links, the brands the AI already recognizes as familiar, credible, and frequently referenced are the ones that make the shortlist. The unknown provider who was counting on catching Bob at the bottom of the funnel may never get shown at all. In an AI-summarized world, being “easy to remember” stops being a soft metric and becomes a hard competitive advantage. When search gets shorter, brand memory gets stronger.

What This Means for Your Media Plan

The 95/5 rule is a guide for strategy, not a literal budget formula. It does not mean every advertiser should invest 95% of their budget in brand awareness and 5% in conversion efforts. The right allocation depends on your industry, sales cycle, growth goals and audience. The larger lesson is that an effective media plan must prepare future demand while capturing the current demand.

Reaching the 95% and converting the 5% require different objectives, messages, and measurements. Both deserve a meaningful role in your plan.

To build brand memory across the 95%, you need reach and consistency—the media that delivers your name and message broadly and repeatedly: radio and streaming audio, video and OTT, display, and social. The goal isn't a click this week. It's recognition that pays off in a trigger moment you can't predict.

To capture the 5% who are in-market today, you need precision—search, behavioral and geographic targeting, retargeting, and clear calls to action that make it effortless to choose you right now. This is where fast, measurable return lives, and it's a legitimate and necessary part of the plan.

The mistake is treating either half as the whole. Pure bottom-funnel spend quietly ignores 95% of your future customers and leaves you fighting for the same shrinking puddle as everyone else. Pure top-funnel branding builds awareness you never cash in. Connected Performance™ ties them together so that when Bob's water heater finally goes—and someone's always does—yours is the name he already knows, and the path to hiring you is already clear.

The 5% will always be tempting. But the advertisers who win the next decade are the ones building their brand with the other 95% today.