Social Media and the 80/20 Rule

Posted by Rich McElaney

We've all heard about the 80/20 rule at some point in our lives. Officially, it's known as the Pareto principle, named after Italian economist Vilfredo Pareto who observed in the early 1900's that 80% of the land in Italy was owned by 20% of the population.

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For most business owners, the rule often works like this: 80% of their revenue comes from 20% of the customer base. While those exact numbers may not play out in your business, the fundamental premise of the principle most likely holds true. Your business has a core group of customers that you count on for predictable revenue. Have you ever closely examined why this is?

There are several factors that might influence this:

  • Your relationship with these customers is deep - you know them well - they know you well.
  • Based on this close relationship,  a healthy amount of trust has been established.
  • Because you know them well, you can easily (and maybe even unconsciously) tailor your products and/or services to fit their needs perfectly.
  • Because they know you well, they are an excellent source of constant feedback for you. That feedback can be used to monitor their level of satisfaction and to construct new offerings for them (and for prospective clients) that are infinitely more appealing.
  • When they know you well and are satisfied with what you do for them, they are very likely to tell their friends and connections about you.
  • Your relationship transcends from a strictly business construct and evolves into a full, social relationship. 

When we take a close look at these 20% relationships, we see a lot of work and a progression. You can't meet a prospective client today and by tomorrow at 3pm you're at the full social stage. Trust, repeated successes and relationship nurturing take time or they're not going to be solid enough foundations to last.

Now, shift this thought of a progression, and all its attendant hard work (because it is - you can still have fun, but it is hard work) to the online space. If you want to find and cultivate the 20%'ers online, it is going to take some work. And a plan. And consistent execution. And the invocation of the "until principle". (The until principle - as in -" I am committed to this until I am seeing signs of success.)

What this means is you can't throw a website up, open a Facebook, Twitter, Google+, YouTube and ________(fill in the blank with your favorite platform) account and then detach from them with any expectations of success. Show this online process the same care, love and attention you do with your offline 20%'ers and you will get results that will blow you away.

 

 

Tags: social media commitment, social media best practices, social media success, building relationships online