80 20 Rule of Digital Marketing
At Finyki, we have always tried to emulate some of the cardinal rules and principles of marketing to achieve the results we promise to deliver on. One of these principles that we embody in our marketing strategy is Vilfredo Pareto’s 80-20 rule of marketing, also known as the Pareto Principle.
In one of his papers, Pareto noted that about 80% of the land in Italy belonged to approximately 20% of the country’s total population. In essence, the Pareto Principle infers that there’s an 80-to-20 relationship between effects and their causes.
Applying it to the business world, the 80/20 rule suggests that 80% of your company sales come from 20% of your customers. Alternatively, you could say that 20% of what you do represents 80% of that particular activity’s outcome.
In the sales and marketing ecosystem, you can use the 80-20 rule of digital marketing as a guide to come up with highly effective business solutions for your company. To understand this fundamental principle even better, we have broken it down into its main characteristics.
The 80-20 Rule of Digital Marketing can be divided into the following parts by which you can achieve 80% results by giving in 20%.
- Discover your best customers
- Locate your customers geographically
- Dealing with difficult customers
- Delight your best customers
- Manage your operational costs
Discover Your Best Customers
You probably have hundreds or thousands of contacts on your client and prospect lists from your website, and email and social media marketing efforts. Keep close tabs on which customers made a recent purchase, are frequent buyers, or which ones were generous in their purchases.
Once you’ve identified them, tag them as a top priority for your sales and marketing efforts and use their customer data to help you find and attract new audiences.
Locate Your Customers Geographically
Look for trends in your POS platforms while paying special attention to where your best customers are. You’ll notice that certain neighborhoods, locales, cities, or regions are far more lucrative than the rest of the market.
You can then leverage this information to boost your sales and marketing strategies in these locations. Identify Customer Niche During the selling cycle, you’ll likely come across customers who exhibit particular behaviors that signal buyer intent.
Use this information to identify commonalities among prospects actively looking to make a purchase, and build on their experiences to drive them along your sales funnel.
Dealing With Difficult Customers
Whether you like it or not, you’ll be dealing with hard-to-please or overly demanding customers who test your patience and pull down your productivity numbers through needless, recurring questions or requests. If you’re at their beck-and-call, it means you’re not setting expectations right or being firm in setting the parameters of good customer service.
Take a look at these customers and their buying habits. Are they in your top 20%? You may be losing precious time engaging with and responding to customers who, in the long run, simply may not be worth the time and effort.
Delight Your Best Customers
Certain clients are always going to be your high-volume buyers, but it’s important not to take them for granted. Don’t lose sight of your best clients while getting bogged down in acquiring new customers or dealing with problem clients.
Make sure that you’re always staying in contact with your best clients and providing a superior customer experience. Keep these types of customers delighted with your service by interacting with them on a more personal level, and continue exploring other business opportunities with them.
Manage Your Operational Costs
Managing your costs works on many levels: it helps you save by avoiding counterproductive measures and enables you to make good budget decisions.
To sum up, the 80-20 rule of digital marketing can provide a solid framework for your sales and marketing objectives. Whether it concerns your customers, salespeople, or company resources, it may be worth your while to adopt the Pareto Principle in your company’s business operations.
