I want to talk about something that lots of agencies ignore, which could be the difference between making a few thousand dollars and a few hundred thousand dollars.
If you follow this, it’ll categorically prove exactly what you need to sell more of, what you can ignore, and what you need to focus on.
Back in the 1800s, there was this Italian guy who noticed that roughly 80% of the land was owned by around 20% of the population.
And what he also noticed was that 80% of the food produced for the people, came from around 20% of the land.
Everywhere he looked, he saw this magic productivity ratio, from gardening to manufacturing.
80% of the wealth was generated by 20% of the people.
80% of the exports came from 20% of the suppliers.
And so he started looking at profits and income too.
And sure enough, we see that same magic ratio working as hard today as it did 200 years ago.
With a previous agency client I worked with, we listed out all the products and services that they were providing.
We took the revenue, profit, average order value, clients sold, and (perhaps most importantly) delivery cost, for each product.
And wouldn’t you know it.
When we listed out all these numbers in a clear to read format, over 80% of her current success was coming from only 1 to 2 products.
You see we worked out that most of her time was spent on very unprofitable, time consuming, work-load heavy projects.
But they didn’t deliver the income that she wanted.
So while 80% of her time was taken up with 20% of her clients and services, 80% of her revenue was coming from a different 20% (ish) of her offers.
A bit like how Vilfredo Pareto, namesake of the Pareto 80/20 rule, discovered that 80% of the wealth is owned by 20% of the people.
We identified her most profitable, easy to deliver products and that’s what told us what to focus on.
