80/20 Marketing: The Eighty Twenty Rule in Marketing

80/20 Marketing

In today’s blog post I’m going to talk about 80/20 marketing and how you can make use of it in your own business. I recently read this book by Perry Marshall called “Eighty Twenty in Sales and Marketing”. I had a few really amazing takeaways from the book and I’d love to share them.

What is 80/20 Marketing?

In case you don’t know what the Eighty Twenty rule is, here’s a quick recap. Basically, the Eighty Twenty rule says that 20 percent of what you do in your business causes 80 percent of the results, and that is a huge idea! The main concept here is that there are certain high leverage tasks that lead to most of the results and most of the money that you make in your business.

If you focus on these tasks, you will, of course, have a lot of leverage in your business. However, there are also 80 percent of the tasks in your business which cause only 20 percent of the results and in turn, 20 percent of your income.

Obviously, the goal in your business should be to always focus on that small 20 percent segment that causes 80 percent of the results and not the other way round. Here is the problem though: sometimes, it is not easy to identify the high leverage tasks in your business.

But if you think about it, if you reflect and if you take some time to look at your business, you will soon realize what they are.

Identify high leverage tasks.

Now, let me give you a few ideas about which tasks are in the 20 percent segment and which are in the low leverage 80 percent segment. For example, if you own a company and you are designing your own logos or you are building your website, then guess what? That’s not a high leverage task. If you have a different logo, it won’t have any impact on your income.

Maybe it might have a 1 percent impact but it won’t cause one of those 80 percent impacts in your business. Therefore, if you spend eight hours on any given day, designing a new logo for your business, you are spending eight hours on an extremely low leverage task that will only have a tiny impact on your business and sales.

On the other hand, if you spend those eight hours a day on prospecting and finding new potential customers and then you call those customers, then guess what? That’s in the 20 percent that causes 80 percent of the results. Now it does not mean that this needs to be true in your business. I’m just giving you some basic general examples of what these tasks could look like.

However, in most cases, the 20 percent tasks that cause 80 percent of the results in your business are marketing and sales tasks.

Hence, your job as the owner of the company is to bring forward the vision that you have of the company and also to focus on the selling and marketing. If you do that in your business, it is very likely that you are focusing on the 20 percent segment that causes a huge increase in sales.

You must make sure that you are always aware, at any given time, in which segment you are. Here’s what I usually like to do. I have a desktop background on my Macbook Air and basically, it shows me a graphic of the Twenty Eighty rule. So whenever I look at my laptop, I’m always reminded of it. At all times, you want to be asking yourself: does the task I’m doing fall under the 20 percent segment or the low leverage 80 percent segment?

You have got to ask this question over and over again as you’re working.

This is a little tip for you. Get yourself a screensaver or something like that (maybe a desktop wallpaper) so that whenever you are working and you see your wallpaper, you are reminded of the Twenty Eighty rule. Then, you can ask yourself: is the task that I’m doing right now a part of the 20 percent of activities that cause 80 percent of the results? If the answer is no, you’ve got to immediately stop what you’re doing and refocus on the 20 percent segment.

Where else can I apply this?

So, always ask yourself this question. You can apply the same principle on your business expenses. We just spoke about tasks and what you are doing in your business right now. However, the same thing also applies to your business expenses. You must ask yourself: do I need to spend $10000 on a new website? Will that expense result in an 80 percent business growth and income? The answer is, probably not. Instead, if you spend those $10000 on Facebook ads, that is more likely to result in an 80 percent business growth and income.

Maybe you shouldn’t be investing those $10000 on your new website even though it feels really cool. It might be good for your ego but it’s not too great for your business. It’s better to invest the money on Facebook ads or a campaign which you know works.

Then, you can dig even deeper.

You can apply the Twenty Eighty rule on high leverage tasks and expenses and once you have identified the 20 percent of these tasks and expenses, you can dig even deeper. You can zoom in even closer and find the 20 percent of the 20 percent, or even 20 percent of that. You can zoom in more and more and eventually boil down all your activities and your entire business to a handful of tasks and expenses that cause most of the results in your business.

This is a great thing for you because you can strip away all the useless, distractive things in your business and your life. Instead, you can focus on the pure, core tasks and expenses in your business that will make it grow and increase your income.

You can then pour all your money there.

Of course, sometimes you need a new website or you need to buy a new domain or something that is just necessary for your business despite not being high leverage. You can still get that stuff but you must always ask yourself this question. Is this expense really needed right now? Is this expense in the 20 percent segment or the 80 percent segment? If you get into the habit of asking yourself this question over and over again, I can assure you that your business will grow faster than you can imagine. This is because you’re getting rid of all the bullshit in your business and you have a laser focus that will make all the difference in your business.

Another cool thing is that you can also use the Twenty Eighty rule while hiring other people. Let’s say that you’re hiring some freelancers or virtual assistants to work for you. What you can do is get them to focus on certain high leverage tasks that you don’t want to do yourself. For example, I hire somebody to create prospect lists for me so I can cold email these businesses. Personally, for me it is a very boring task and I don’t want to do it. However, it’s also a high leverage task in many ways. Hence, this is the perfect sweet spot! I can outsource a really high leverage task and get someone else to do it for me. I’ll just send out the emails, take care of the marketing and the sales copy. It is a perfect use of the Twenty Eighty rule in hiring a virtual assistant.

Featured image by Scott Thomson via Flickr.com

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Till Boadella

Till Boadella is a serial entrepreneur and digital marketing expert who helps small businesses get more traffic, generate more leads and make more sales. He built multiple successful online businesses that he can operate from anywhere in the world on his laptop. Till brings over two years of first-hand internet marketing experience to the table. Additionally to this he’s spent thousands of dollars on split testing different offers in the last year alone.

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