The Forgotten Customers: Those Who Aren’t Buying From You… Yet

During World War II, Allied military strategists were eager to reinforce their aircraft for better resilience during combat missions. An extensive examination of the returning planes revealed that they were most frequently hit in the wings, tail, and fuselage. The initial reaction? Strengthen these parts.

However, statistician Abraham Wald challenged this conclusion. He pointed out a critical flaw in their reasoning: the analysis was based only on the planes that had returned from missions. Wald suggested that attention should instead be focused on the areas that were hit on the planes that didn’t make it back – the cockpit, engines, and fuel tanks. These, he argued, were the truly vulnerable parts. This perspective completely transformed their approach.

Survivor bias, the phenomenon of making decisions based on an incomplete set of data, like those planes that survived, is still prevalent in decision-making today. It sheds light on why sales and marketing often seem to be at odds.

Sales teams typically focus on customers who have “made it through” the sales funnel. Their world revolves around the consideration stage of this funnel, celebrating victories to the executive team. While sales are crucial, there’s a common misconception that the customer’s decision is solely based on the facts and expertise presented by the salesperson. In reality, customers often have already made a subconscious decision before even meeting the salesperson, having navigated their way through the funnel to that point. By focusing only on the conversion or the final purchase, a distorted view of what truly attracts and engages customers can emerge.

Today’s trend in performance marketing – digital marketing focused on optimizing for results – creates a similar illusion. It’s all about conversion: did the customer leave a lead, make a purchase, download something? Digital metrics show the hits, but not the misses. Corner offices obsess over short-term ROI, pushing marketers to pour all their efforts into reaching those ready to buy. Logical, yes, but myopic.

A study by LinkedIn and the Ehrenberg-Bass Institute compared the long-term effectiveness of brand marketing versus performance marketing. The hypothesis? That well-optimized, conversion-focused digital marketing would trump the seemingly whimsical world of brand marketing. The long-term results, however, surprised many. Brand marketing proved more effective than performance marketing in terms of efficiency.

A deeper understanding emerges when considering the potential audience of a brand, along with the time window. This gave rise to the 95-5 rule, particularly relevant in the B2B world. It suggests that the vast majority of potential customers – 95% – are not looking to purchase your services right now. But later, they likely will, as businesses infrequently acquire new products or services. By focusing solely on the immediate 5% ready to buy, companies miss the opportunity to impact a broader audience – those not currently in the buying cycle.

This leads to a somewhat paradoxical conclusion: target your marketing broadly at those who aren’t buying right now. Invest in branding so that when the window of opportunity opens, your brand is top of mind. Market share is captured by companies that are remembered, as the most crucial search engine still lies within the human mind. The same study reveals that even with a smaller media budget, but with creative execution, you can outshine the tactical ad spreads of giants.

This finding doesn’t mean we should entirely shift gears and stop tactical marketing or stop optimizing for conversion. Both are needed. Customers still require credible prompts at the moment of consideration, but the focus of marketing communication can be safely shifted from short-term sales to brand marketing. It turns out, this approach not only builds long-term brand value but can also drive immediate sales.

Let’s think broader than the obvious, like Abraham did. To sell more, hire the best, and market more effectively, strengthen the most critical part: the perception of your brand. A lesson well researched and worth learning.