There is an old adage that floats around that says 80% of your business comes from 20% of your customers. Or the 80/20 rule. You get the idea. So my question is this… do you KNOW who your 20% are? Do you reward them? Do you 'fast track' them? Do you treat them like VIPs? Do the 80% feel slighted because of how you work with the 20%?
Now, if you sell $1 widgets, you might not need to cater to your top customers, unless they are large / bulk / repeat customers (a hunch by me, I don't sell $1 widgets). I sell services – mostly my brain, but sometimes my time – so it is crucial for me to identify who's bringing me in the most money (or referring me to those that do).
Just food for thought this morning while I think ahead to the next few weeks of work and what goals I need to reach.
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Good thoughts to provoke thoughts
that is a great question…..
I see so many of my friends & clients spin their wheels for the 80% and IGNORE the 20% – thinking that the 20% are always going to be there. Just seems backwards to me.
I always think, if I lost 3 of my clients today, which 3 would cause me the most 'damage' to loose? Then I call them and see how they are & just chat to say hi 😉
The 20% will always keep coming back for your advise if true, honest and rewarding.
How do I reward the 20% that keeps coming back?!
exactly
Whether it's one customer or 100 you still have to treat as individuals and make them feel special.
I offer free trials of my new services to clients' I think might benefit, risk going a little further than contracted, and #1 always finish a conversation with reinforcement of an action or promise are a few examples.
For me it really comes down to being able to listen to clients' needs and provide for it.
It all depends on the service
You just need to not fluster when you encounter a customer and you should really spend time with it.
Great post I love the thought provoking question and the feedback was awesome
Bottom line profitabilty often forgets who got the company rolling. Expanding and adding additional comforts for the best customers enhances their love for the company. This will eventually trickle to the secondary consumers, unknowing of the great "biggest fans" who made it happen.
Wonderful.. these are very common oversight, especially in companies in the developing nations.. great article..
Being new to the business it is still my biggest hurdle to identify that 20%
Known as Pareto's Principle.
This rule is for people too lazy to research their customer database. It does not always apply in the real world, only in MBA fantasy worlds.
Unlike.
I have always been interested in customer relations. When I worked in retail, I treated my 20% like family. Well, truth be told, probably better than family (say sorry.)
An example would be letting my customers know that the product they were looking at, the product they needed, they wanted, & the one they could afford were usually not the same product. By finding out what they needed and could afford, I could give them the best deal. In many cases, I would refer them to another retailer if I did not carry what would most benefit them, even though this led to short-term revenue decrease.)
This "for good measure" approach, as B. Franklin would call it, earned me more in repeat business & word-of-mouth-referrals than my co-workers, who consistently tried to up-sale their customers. Another result was that the customers who had been talked into buying something they didn't need (by my coworkers/competitors) would be more likely to return a given product, thereby driving down the real revenue of my competitors.
The lesson learned, "Do unto others…"
Great post +Lynette Young
I treat them Purply!!!
+Lynette Young : I apply the Pareto principle in every aspect of my life.
yeah same
Yes. And yes and yes.
Two of our clients make up more than 80% of our business. We never put them off when they ask for our time. We call them on the weekends (very few of our clients even know they can reach us on weekends) and plan so that when we are out of town, their work can come with us. They have specific billing dates so invoices to them are never a surprise.
And we have one – who calls only a few times a year, but pays top fees and always remits within a week of receiving the invoice. That one gets a price break.
+Debi Vaught-Thelin I love it! My first thought was "ask for referrals and recommendations!"
ere muy guapa