You may have heard of the 80/20 rule, also known as the Pareto principle, which states that roughly 80% of effects come from 20% of the causes. When applied to business and marketing, this can mean several different things:
- 80% of your sales come from 20% of your customers
- 80% of your profit comes from 20% of your products
- 80% of your company’s output comes from 20% of your employees
This principle shows that inputs and outputs of your efforts are rarely balanced. So how do you make the best and reap the maximum rewards? One of the keys to success is to maintain and build lasting relationships with your customers. Relationship marketing focuses on communication and efforts to retain customer loyalty in order to build a mutually beneficial relationship. Many businesses forgo this approach in exchange for quick profits in the short run. In the long run, keeping customers happy will help you retain a loyal base of customers.
Rather than constantly looking for new customers, it’s important to keep existing ones happy. This can be easier said that done, especially for large companies who tend to focus on getting more new sales. It’s time to forget the phrase, “If you build it, they will come” and emphasize the point that “The customer is king”. Customers have plenty of choices and can easily choose one of your competitors if they are not treated well.
