The 80-20 Rule: Make Your Life and Your Business More Efficient

The 80-20 rule, also known as the Pareto Principle, which states that 80% of the world’s land is owned by 20% of the world’s people. Since this rule was discovered in 1906, experts have discovered that the 80-20 rule applies to much more than land. You can apply this principal to virtually every aspect of your life.

The 80-20 rule is extremely powerful for business – especially for sales and marketing.

How the 80-20 rule applies to your time

My first encounter with the 80-20 rule was during a marketing webinar. The presenter talked briefly about the Pareto principle, and then they said something that completely changed my relationship with marketing: “As a fledgling business, you should spend 20% of your time on content creation and 80% of your time on marketing”.

As someone who has always been a marketer first and business person second, this idea blew my mind. Why would I even think about spending 80% of my time on marketing? I actually enjoy marketing, but it isn’t my primary passion, and isn’t the point of being in business to be passionate?

Halfway through 2016 I decided to apply this principal to my work, tired of posting articles nobody read. Within a few months my Twitter following and email subscriber list doubled, and I found myself having to turn clients away for the first time.

The important thing to remember is that how you apply this rule to your time changes as your business grows, because the activities that have the most impact on your success change. What you should actually be doing is spending 80% of your time on the activities with the highest ROI and 20% of your time on everything else.

You can also apply this to your life outside of work by spending 80% of your time on the activities you find most satisfying and 20% of your time on everything else.

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How the 80-20 rule applies to your customers

Another way you can apply the 80-20 rule to your business is by using it to find your most valuable customers. In general, 20% of your customers will provide 80% of your profits. If you know who these customers are you can use this knowledge to create an excellent loyalty program and targeted email campaigns.

How the 80-20 rule applies to your marketing budget

When applied to your marketing budget, the 80-20 rule means that you get 80% of your profits from 20% of your marketing messages. Figuring out what messages make up that 20% helps you decide where to spend your marketing budget.

You may even discover that the most useful 20% of your marketing messages are sent freely through social media or email, freeing up your budget so you can either a) hire someone to take over these jobs for you or b) invest that money in another area of your business.

Understanding how the 80-20 rule applies to different areas of your business and your life can completely change the way you interact with the world.

You can use marketing automation tools like the Maropost for Marketing to collect and analyze marketing data for you or even to automate 80% of your sales and marketing so you can focus on the 20% that really matters to your business.