In 2023, a study revealed that the average American has 80 apps downloaded on their phone. And of these, they use just about 9-10 apps per day.
Now take a moment here…think about your smartphone. How many apps do you have on your mobile? How many of these do you use regularly? What is the percentage of apps used vs the app available on your mobile?
In 1906, Italian economist Vilfredo Pareto observed that 20% of the people owned 80% of land in his country. After further study, he concluded that there existed a natural tendency for an unequal relationship to exist between inputs and outputs. He propounded that 80% of consequences emerge from 20% of the causes. And this became the 80/20 Rule.
A few decades later, Dr. Juran, another economist, who concurred with what was now also known as Pareto’s Principle, had additional insights.
He extended the idea to state that in any group of factors contributing to a common result, the bulk of the effect,ie. 80%, was due to a few accounts, the 20%. At the time,he preferred not to disregard the remaining 80% while focusing on the 20% and therefore called it the “vital few and the useful many”.
Among Dr.Juran’s most important observations was that it was a “universal” principle and applicable in multiple situations and not only in economics, and was especially important in the context of quality.
The 80/20 Rule and ABM
ABM is a marketing strategy which has at its core a commitment to quality output through actions that are steeped in a focused, bespoke approach distilled from exhaustive data analytics.
The Pareto Principle therefore plays an impactful role in shaping successful lead generation programs. Drawing from its core concept of prioritizing efforts, Account Based Marketing(ABM) aligns perfectly with the 80/20 Rule.
Just as the rule emphasizes prioritizing tasks for maximum efficiency and results and focusing effort on those aspects that have maximum impact on results, ABM strategy too is about concentrating efforts and resources to engage with and nurture a curated set of targeted accounts. The messaging, campaigns and interactions are customized to the business and personalized for the individual to ensure it resonates perfectly.
Incorporating the 80/20 Rule within ABM strategy
Applying the Pareto Principle to marketing implies that even a 20% focused marketing effort has the potential to generate 80% of leads or conversions. So how do we mine this knowledge?
By segmenting, analyzing and sifting the data to uncover high quality accounts with maximum potential to convert and unleashing a concentrated strategy with a compelling offer to get the desired result.
Identify your top 20% in your TAL through research and analysis
Target account lists(TAL) can be long. But not every account on that list is in-market. Find out all there is to know about your account – their firmographic details such as size, budget, number of clients, industry, technologies used and buying intent. Are they the right fit? Is the business ready to buy? Identify the top 20% and focus your ABM strategy on these shortlisted accounts.