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How to Use 80/20 Principle To Get To Your Best Customers - DailyBlogTips

How to Use 80/20 Principle To Get To Your Best Customers - DailyBlogTips


How to Use 80/20 Principle To Get To Your Best Customers

Posted: 05 May 2015 06:48 PM PDT

All customers are not built equal. Some make you more money and some cost you more money to keep.

In a rather insightful way, Richard Koch’s classic The Pareto’s Principle (or the 80/20 Principle) actually puts numbers on the ‘some’ part of the equation.

Roughly, only 20% of your customers contribute to 80% of your revenue.

Which means that 80% of your customers (who only contribute to 20% of your revenue) demand time, energy, resources, staff, and everything else your business has.

The story doesn’t just end with 80% of your resources being spent on customers who don’t matter to your business, it also means developing special skills just to keep Ms. Customer happy.

If you actually put your own numbers to test, you’ll find that Pareto’s principle is actually scarily, almost accurate, and insightful.

As you apply the 80/20 Principle to every single process of your business or every area of your business, you’ll begin to weed out what doesn’t work for you. You’ll streamline and make things more efficient.

The end result is that you’d be working with customers who actually contribute to your business. Your customers also become evangelists since you give them more time. See what you can do with your customers based on the 80/20 Principle:

Mine in and mine out

You have a list of customers, all right. Do you know who your most profitable customers are? Or do you do know the exact group of customers who are most demanding?

Starting with the 80/20 Principle, you’ll be able to identify these groups of customers. Data mining doesn’t have to sound geeky when you know that the end result is list(s) of customers you know what to do with.

Geo-locate your profitable customers

If 80% of your revenue comes from only 20% of your customers, chances are that your maximum revenue also comes from a specific geographic local (no matter how global your business is).

Particular geographic markets turn out to be more profitable for you than others. Identify or geo-locate your most profitable locales.

When you do, you can focus more on markets that matter. Your ads could be custom-made for these markets and you can even choose to dedicate more resources for these geographic locales.

Dig into the 80/20 layers

Perry Marshall wrote the definitive guide for sales and marketing by squeezing all that the original Pareto’s principle had to offer in his book 80/20 Sales and Marketing.

In his book, Perry Marshall writes the real power of 80/20 rule is in the layers.

So, there’s 80/20 for something. Then there’s 8/20^2, and then there’s 80/20^3.

Each of these layers is a source of leverage. In terms of ratios, this is how it plays out:

80/20 = 16:1
80/20^2 = 250:1
80/20^3 = 4000:1
80/20^4 = 65,000: 1
80/20^5 = One million to 1, and so on.

You’ll narrow down. You?ll squeeze. If you can identify what works for you, leverage is the key. Find who your customers are and how much they are willing to spend on you.

The layers within 80/20 helps you get there.

Fire Those Who Don’t Fit

Finally, there’s the need to cleanse your business of whatever doesn’t work. The 80/20 doesn’t concern itself with ‘average’. The power curve that comes from 80/20 focuses on the ability, the alpha, the A players, and the winners.

For all your customers who don’t fit into this, you?d do better to fire them.

Why spend any resources on 80% of your customers who don’t contribute to even 20% of your revenue? What’s the fun in that?

Think about it. Did you ever apply the 80/20 Principle to your business? If so, what did you do about it?

Niraj is the founder of Grexit, an app the lets you share Gmail labels with other Gmail users. Niraj works on programming, customer support and sales, and also contributes to design and UI. He?s a fusion music aficionado, loves to play the guitar when he can.

Wanna learn how to make more money with your website? Check the Online Profits training program!


ProBlogger: Easy Ways for Bloggers to Use Keywords to Drive Traffic

ProBlogger: Easy Ways for Bloggers to Use Keywords to Drive Traffic

Link to @ProBlogger

Easy Ways for Bloggers to Use Keywords to Drive Traffic

Posted: 05 May 2015 07:12 AM PDT

Confused about keywords? We break it down to help you get started. Easy Ways for Bloggers to Use Keywords to Drive Traffic / Problogger.netThis is a guest contribution from Nick Rojas.

The world of web promotion and search engine optimization has never been a consistent one.

Constantly changing Google results algorithms compete with tricky marketers in what is essentially an arms race, with each side trying to gain a lasting advantage against the other. However, though the tools change constantly, the battleground stays the same.

We're talking about keyword research. Every time a Google update levels the playing field again, it comes back to this: if you create high quality content that people read, you will gain prominence in Google results. And the best way to do this is with keyword research. We've got some great tips to help you make sure your blog has its keyword game in top form. Read on!

Make a list of the most important topics that you cover on your blog

One good way to conceptualize the idea of a keyword is to think backwards. What kind of people are you trying to attract? What is your ideal reader looking for?

Go back through your blog entries and mentally sort them into vague lists. If you use tags or categories, this can help a lot as well. Basically, you want to create large "content buckets" that you can fit most of your posts into.

Transform those content buckets into keyword lists

Once you've assembled some buckets that most of your posts fit into, you can identify keywords to fill those out. These are phrases that you'd like to rank highly on the search engine results page.

An example might be a blog about maternity fashion that provides some affiliate referral links to clothing stores where readers can buy the recommended clothes. This hypothetical maternity wear blog would want to rank highly on searches like "clothes to wear during pregnancy”, "maternity fashion", and other searches like this.

This isn't a be all, end all list of the keywords you'll be using, but rather just to clear your mind of all the obvious ones.

Get a good mix of short tail and long tail keywords

Some keywords are easier (and cheaper) to rank on than others. The cheap, easy ones are long tail, and are associated with much less traffic than the short tail keywords, which are particularly popular and frequently searched. The web has tons of tools for all kinds of things, from business name generators to tools like the Google Adwords Keyword Tool, which is great for this sort of thing.

Use tools to get a great keyword spread

Other great tools for this are Topsy and Buzzsumo. Topsy helps you uncover the confusing and convoluted work of social media keywords. Topsy is essentially the Google Trends of social media, allowing you to page through the recent history of keywords on social media to identify trends in that medium.

Buzzsumo helps you make sure that your keyword list is as comprehensive as that of your competitors. It helps you analyze their sites directly, helping you to spot when a new trend in your industry or field is coming up and letting you stay on top of it.

Keywords: always relevant

No matter how many Google updates happen, it seems likely that keywords will remain just as relevant as they have always been. It's how people actually think and actually search for things, so barring any major sea changes in how people interact with their computers, keywords are likely to be an extremely important way to organize search and rankings. It pays to stay on top of your keywords!

Nick Rojas is a business consultant and writer who lives in Los Angeles. He has consulted small and medium-sized enterprises for over twenty years. He has contributed articles to Visual.ly, Entrepreneur, and TechCrunch. You can follow him on Twitter @NickARojas, or you can reach him at NickAndrewRojas@gmail.com.

Originally at: Blog Tips at ProBlogger
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Easy Ways for Bloggers to Use Keywords to Drive Traffic