Oct 30, 2022
We have all heard about the 80/20 principle, but how does it apply to making some fast money in business?
Ask an audience to stand up if they own a pair of shoes, stay standing if they own 2 pair, 4, 8, 16, 32, 64, 128 pairs... you will ultimately be left with one person (likely a lady 🤣) still standing. If you do the math and add the shoes owned in the room 80% of the shoes will be owned by 20% of the audience.
Same will apply with:
- Watches owned
- Domain names owned
- Anything you can think of
Stop treating all customers the same, because 20% of THEM are very different.
Armed with the basics of 80/20, entrepreneurs can supercharge their profits.
No matter what you are marketing there is always a cohort that will go straight to the top and buy the VIP experience. The catch, is this more expensive offering must feel more valuable! An $800 product must feel worth it. Nobody will pay $800 for a $3.50 cup of coffee, but some will pay $1800 for that same barista machine for home.
If you do not offer your clients a super-deluxe experience, I will guarantee you that another entrepreneur will.
Great marketers are the alchemists who craft endlessly irresistible offers, such that people spend disproportionate amounts of money.
“Sports fanatics’ insatiable itch”
Season tickets, VIP boxes private memberships they all sell, to somebody!
You can get a single ticket to the football for $60, season tickets for up to $2000. But, the most luxurious VIP boxes require multi-year commitments of hundreds of thousands of dollars. How do sports get 50% of their revenue from 1 percent of customers? They scratch the “sports fanatics insatiable itch”!
In other words...
“How much money will a raving football fanatic, who has money, spend on football?
Virtually an unlimited amount!
Almost everybody has one passion, interest, obsession where they will gleefully spend irrational amounts of money.
Somehow, they will find a way to justify it.
Whenever there are rabid, obsessive customers, there is a great business. For some, its rock concerts for others its rare books and for my wife it is shoes. A member of the 20% 🤷‍♂️.