HOW TO KEEP THE ONLY CUSTOMERS THAT MATTER
In the TechSparq offices, we talk a lot about sustainability and the garment industry. We have been evaluating ways to make positive impacts on the planet using technology – what we call “sustainnovation”.
This week, we’re talking about one of the pillars of our business model: 80/20 in Full Effect. Those numbers will sound familiar to most folks – the Pareto Principle has been around for a long time. It describes the phenomenon that can be uncovered in nearly all facets of life. For business purposes, it can be as simple as the fact that your brand makes 80% of its sales from 20% of your customers.
If this is all new to you, check out G2’s article about applying the Pareto Principle to project management.
Drop That Zero
So what does sustainnovation have to do with 80/20 in Full Effect? As with everything else, it’s all connected. It turns out that 80% of your returns come from 20% of your customers, too. You will shrink your carbon footprint by focusing on the customers who love you the most.
Part of being a grown-up is understanding that not everyone is going to like you, and that’s ok! In fact, it helps to strip away all the noise. When you stop trying to please everyone, you discover your actual identity. Brands need to be applying laser focus to their top 20% (or, exponentially, their top 4%), as the ROI is unmatched.
Get With the Hero
Your tried-and-true brand stans are the most important commodity your company already possesses. What have you done for them lately? What if you stopped trying to make the masses happy, and instead gave all that love – concentrated, not watered down – to the people that have already proven their loyalty? And they’ve proven it in the realest way possible: with their spending power, limited drain on customer service, and near-zero return rate.
For more on 80/20 in Full Effect and how it can improve everything in your business, both internally and externally, read one of my earlier blogs. And for a fascinating read from Medium about the direct link between the Pareto Principle and the environment, click here.