Have you ever found yourself saying “Pass!” I already know that.
Most people are guilty of it because they are always looking for the next, must-have tip or piece of software to get the best results.
Business owners and investors are like most people and only look at the surface of their business and investments rather than deep-diving into the treasures that exist in their business.
When deep-diving there are telltale signs about what is working well and what isn’t. Concentrate on what works well, and these little treasures explode, creating exponential growth.
Table of Contents
- Are You Using The Pareto Principle
- Take it a Step Further
- Applying Pareto to a Content Based Business
- What I Discovered from Monitoring
- Look Within and Ask What Next.
- Quality Not Quantity
- Deep Diving is a Necessity Not a Luxury
Are You Using The Pareto Principle
Italian Wilfredo Pareto, had a lot of titles to his name, civil engineer, sociologist, economist, political scientist and philosopher. Probably the most important for our time, is he developed the field of microeconomics. Through this and his work on income distribution, he discovered that 20% of the population held 80% of the wealth.
Deep diving into this Pareto noted that the 80/20 rule could be applied in every industry.
Joseph M Duran took this a step further to include management and quality control within a business. He identified that 80% of issues are caused by 20% of caused issues.
In computing, Microsoft found that fixing 20% of the top reported errors fixed 80% of their problems.
when applying the Pareto Principle to business, some of the discoveries are that 20% of customers generate 80% of income. 20% of customers take up 80% of business time in handling their complaints.
But for me, one of the most interesting aspects of business growth and investment growth is that 80% of the income generated comes from 20% of the effort. Identify the 20% of activities that generate income and focus on those. The results are good growth but it could be better.
Take it a Step Further
To create exponential growth, take this a step further.
Once the 20% has been identified, use the 80/20 rule to identify 20% of the 20%. This becomes the treasure to grow the business exponentially.
Deep diving takes a look at a narrower focus for the business. The really key components that grow the business.
A Fire Protection Company was the first business jointly owned with my husband. At the time my husband was regarded as one of the top technicians in his field in the Southern Hemisphere.
Starting our own business meant he already knew some of the competition’s customers but the question was how to get them to leave their existing supplier.
We looked at how we were attracting customers and found 80% of our customers came from people who already knew my husband. Deep diving showed that 80% of those customers came from visiting the customer directly.
So, our strategy was to send out 5 advertising letters each week telling the clients we would be calling the following week to book an appointment with them. My husband would visit the business the following week to book his appointment. Quite often because the letter had already been sent ahead when he called on the business he saw the decision-makers immediately. Then converted them into our customers. Within 18 months our business had 85% market share.
Deep Diving into the 20% activities that generated the most income for the business we were able to grow exponentially in a short time.
Applying Pareto to a Content Based Business
The first step is to look at where the bulk of your income comes from. Find the 20% of activities that generate the income and then break down the 20% and apply the 80/20 rule to the 20%. There is now a more focused area of the online business to concentrate on.
In my own business, the activities to attract and retain clients are:
Speaking to a live audience
Writing and selling books
Newsletters focusing on specific topics
Social Media Content
Blogging
Sales Funnels
The focus then shifted to making those 6 key items the core parts of the marketing and sales strategy for the online business. Concentrating on one item each day and monitoring the results again to see what is working and what isn’t.
Monitoring continues to provide surprise results and has become an important feature of building my business.
What I Discovered from Monitoring
As I started to grow my business and monitor the results there were some very surprising results.
Karen Newton International is an education company teaching clients how to grow businesses and invest the profits into property, digital investments and commodities.
Through Deep Diving into the monitoring results, I found clients wanted a lot more support than training normally provides. So, the business started creating joint venture investment opportunities.
These have grown far quicker than expected.
By, applying “What Next” more joint venture investment opportunities were added and the business continues to grow.
As I write this blog, there are joint venture investments with over 200 existing clients. Not only are clients remaining as repeat clients but there is now a waiting list of clients eager to join the joint venture investment opportunities.
These results have grown the business exponentially and was created through using the Pareto Principle and Deep Diving into the 20% that generates business income.
Look Within and Ask What Next.
One of the most important business lessons learned was to look within a business using the 80/20 rule. Then Deep Dive into the 20% that generates the most income.
While many businesses focus on attracting new customers, and yes, there needs to be new customers coming into the business, however, an important part of business growth is to ask “what next” for existing customers.
Customer retention is where the business growth comes from. Once a customer knows and likes you, they are more likely to continue as a customer and this is where the sales funnel comes in.
No fancy software is needed to increase sales, simply a strategy of asking yourself what you can offer your customers next so they remain a customer.
For my business that becomes coaching customers in building wealth through business, property, digital investments and commodities and offering joint ventures once they have gone through the coaching.
The sales funnel is the assumed next step for customers to grow their wealth, income and lifestyle.
Quality Not Quantity
There is an assumption that the more potential customers that are attracted, the better sales and the more the business will grow. And, yes, that works for many businesses which is why they spend so much money on advertising to bring in more customers.
However, deep-diving into a business many owners can see that customer retention is where the money is made.
Once the customer has spent with the business, they are more likely to spend again and again on more expensive products and services. So, it’s not the quantity of customers brought in that creates growth it’s the quality of the customer.
Identifying the best customer for the business comes down to finding the 20% or the 20% who spend. What attracted them to the business in the first place and offering them the “what next” sales funnel.
Deep Diving is a Necessity Not a Luxury
Many people will say, I don’t have time, I’m too busy trying to build a business. But deep-diving is a necessity, not a luxury.
It becomes one of the tools for a business owner or an investor because when deep diving into a business or an investment and finding the treasures you discover the secrets to exponential growth.