The 80/20 rule for winning lifelong customers
The Pareto principle, or 80/20 rule, is well-known throughout many professions. It states that about 80 percent of the results come from 20 percent of the effort. This principle applies to sales in the area of opportunity management – 80 percent of our sales comes from 20 percent of our opportunities. However, it also applies to the sales activity we undertake to win each opportunity.
Our actions that most focus on unique customer needs, are more creative and improvisational, and this is what sets us apart from our competition. 80 percent of what we deliver is what everyone does. The improvisational 20 percent is our unique value that wins us 80 percent of our business along with lifelong customers.
I spent seven years trying to make it in the music industry where the 80/20 rule also applies. 80 percent is what everyone plays – the melodies, chords and rhythm are what all musicians must do and many get by just doing that. Unique creativity and improvisation is the 20 percent that makes musicians special. However, to enable that 20 percent, musicians need to know and practice the melodies, chords and rhythm enough for them to become habit. When the 80 percent becomes habit we free up our minds to apply more of our musical abilities to improvisation.
Sales is very much like playing music in that 80 percent of what we do to win customers is the same as what our competitors do – our melodies, chords and rhythm. We do standard things to be visible, credible, viable, capable and reliable. The need for improvisation comes when our general approach doesn’t exactly fit the needs of the customer, which is most of the time. We need to appeal to the unique requirements of each customer without changing our basic proposal. It’s all about presenting the solution we can provide but in the customer’s language. Just like great improvisational musicians don’t change the song, we don’t change our products. We need to improvise on top of the standard tools we use to present our value and abilities in a way that each customer can apply our products and services to their unique problems.
The Five Abilities® helps us to turn 80 percent of our deliverables into habit meaning we spend far less than 80% of our time on those activities. Instead we focus more of our time and energy on creativity and improvisation – the 20 percent that addresses the unique needs of our various customers.
For example, Sony Pictures incurred a serious hack attack in November 2014. If we were selling IT products and services to Sony Pictures, we might focus our value propositions on our security capabilities and that of our partners. We couldn’t change what we’re selling but we could improvise our presentations to earn VISABILITY by emphasizing our strength in cyber security.
If instead, we were selling to Amazon which is aggressively focused on global growth, we might want to depict our technology as easy to scale with people who have expertise in the global arena. Again, we wouldn’t be changing the product but instead we’d improvise our presentations to earn VISABILITY by emphasizing our strengths in scalability and global services.
The Five Abilities® teaches us to make habit of 80 percent of our sales approach and guides us to use more of our creative and improvisational energy on the 20 percent of our actions that differentiate us from competitors. The result is more wins and more lifelong customers.
©2015 Rick Wong – The Five Abilities® LLC