3% Rule: Engage Customers Before They Need Your Services

by | May 5, 2015 | Sales

We are all well versed in how to handle a customer with a need. Even if you’re not a professional salesperson, you can sell to someone who needs your expertise.

The challenge is the percentage of companies in your marketplace who are proactively shopping and looking for your expertise is small. Approximately three percent of your market is buying at any given time, the rest is not.

I call this the 3% Rule (which I discuss in detail in my book Sticky Branding). It’s a model to segment your market into buying groups.

The 3% Rule: When People Buy

The model is presented in the image at the top of this page. The triangle represents your marketplace and includes anyone who can buy your services: prospects, current customers, past customers.

The 3% Rule divides your marketplace into five buying segments:

  • 3% are active buyers. These are the people and companies that have a need and are actively shopping for vendors. They want to make a purchase in the next thirty to ninety days. These are sales leads.
  • 7% intend to change. These prospects have a need, but aren’t proactively searching for options. A well timed cold call or marketing campaign can be very effective on this segment, because they are receptive to new ideas.
  • 30% have a need, but not enough to act. This group is not buying. They may look like and act like prospects, but they won’t make a commitment. They have other priorities. Until the need becomes more pressing, they won’t make a purchase.
  • 30% do not have a need. This segment of the market do not have a need for your products and services, and are not receptive to any marketing messages. They may have just made a purchase, they may be too small, or they may not be ready for your services.
  • 30% are not interested in your company. There is a segment of the market that do not fit your brand. Basically, these companies are never going to choose you. They may be loyal to the competition. They may have had a bad experience with your firm. They may use alternative options. Don’t sweat it. Just recognize that this dynamic occurs, and your brand can’t be all things to all people.

Two Modes of Marketing

The 3% Rule demonstrates that there are two modes of marketing:

  1. Top 10%: Marketing to people and companies who have a need for your services right now, typically described as “inbound marketing.”
  2. Lower 90%: Marketing to people who don’t have a need for your services, but will some day.

The first mode is where companies feel the most confident, and it receives the lion’s share of the marketing budget. The challenge is much of that marketing investment is ineffective, because it falls on deaf ears.

Paul Emond, CEO of Versature, sums up the situation nicely, “When people aren’t in the buying mode, they don’t want to be sold.”

The second mode of marketing is the opportunity. Rather than trying to engage people when they have a need, engage them earlier in the Lower 90%. Establish the relationship and develop rapport before they’re ready to buy.

Create an opportunity where your customers know, like, and trust your company long before they have a need. That way they’ll skip right over the inbound marketing messages, and call your company first when they have a need.

Sticky Brands Are Built In the Lower 90%

Sticky Brands engage their market early and often.

They focus a significant portion of their marketing resources on the Lower 90%, build relationships, and secure their place as their customers’ first call when they’re ready to buy.

Sticky Brands are built in the Lower 90 Percent, because they understand the importance of relationships. Their brand is not based on aggressive marketing and pitching. It’s based on a personal connection where their customers know them, like them, and trust them.

That relationship separates Sticky Brands from average brands. When your customers know you, like you, and trust you, they will call you first. And that’s the best place to be in the buying cycle.

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Jeremy Miller

Top 30 Brand Guru

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