⏰ The 3% Rule
🎲 Origin of the 3% Rule
✈️ Go Meet Your Customers
⏰ The 3% Rule
At any given time, 3% of your market is buying, the rest are not. I call this the 3% Rule, and it may be Sticky Branding’s most powerful and popular model.
The 3% Rule divides your marketplace into five buying segments:
- 3% are active buyers. They want to make a purchase in the next thirty to ninety days.
- 7% intend to change. These prospects have a need, but aren’t proactively searching for options.
- 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.
- 30% do not have a need. This segment does not have a current need for your products and services, and are not receptive to marketing.
- 30% are not interested in your company. There is a segment of the market that are loyal to your competitors or do not fit your brand.
What makes the model so useful is it demonstrates there are two modes of marketing:
- The Top 10%: These are active buyers that have a need and will make a purchase decision in the next 30 to 90 days.
- The Lower 90%: These are inactive buyers. Build relationships with these prospects and customers early and often so they choose your brand first when they have a need for your services.
One Stat to Watch
11.1%
increase in global business travel spending in 2024, according to GBTA. Go meet your customers, because your competitors are.
🎲 Origin of the 3% Rule
The 3% Rule grew in popularity from my book, Sticky Branding. But I still get people asking, “What’s the source of the 3% Rule stats?”
The origins of the 3% Rule came from my experience in the recruiting sector. We noticed a trend in active versus inactive job seekers, and then extrapolated the hypothesis to sales and demand generation.
The model wasn't based on formal research, but based on a set of trends that we saw in our own data.
Recruiting is a fascinating environment, because we prospected at scale. Our recruiters were interviewing dozens of candidates per week, plus we received thousands of applicants to our job ads. This allowed us to build and test a set of models to create the 3% Rule, and then compare it to what we saw in demand generation programs — both for ourselves and with clients.
I have been using the 3% Rule as a model since 2005 and wrote about it in Sticky Branding, published in 2015. The model has held pretty consistent and true. The percentages don't track consistently to every industry, but the philosophy of how to engage active and inactive buyers is a constant.
✈️ Go Meet Your Customers!
Post-pandemic we are seeing a nasty habit in sales: salespeople are not meeting their customers. They rely on Teams or Zoom meetings too much!
Get outside the comfort of your home and go meet your customers!
In a downturn, the best marketing tactics are old school.
Dust off the sales playbooks from the 90’s and early 2000’s — a time before social media and inbound marketing. A time where salespeople had to get in front of their customers to sell.
Get belly-to-belly and knee-to-knee with your customers. Go meet them!
A trend we have seen at Sticky Branding since 2022 is the power of direct selling. The companies that are advocating field time and mandating in person customer visits are increasing sales by 20% or more!
Instead of booking another Teams or Zoom meeting, ask to meet your customers. Advocate your salespeople to get back into the field. If you’re like most of Sticky Branding’s clients, you will see an immediate lift in sales performance.
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