Where did the Pareto approach go?

Have you been schooled in the 80/20 rule? Or have you emerged in the CPM, digital, and MarTech world?

The challenge with the latter is that a cost approach is a spiral downwards.

In the endless attempt to connect a myriad of adtech and customer systems to identify marketing success, a critical eye has been taken off the real task at hand. Delivering customer value.

Value in a profit sense.

Value in a level of knowledge sense.

Value in a satisfaction sense.

And value in a word of mouth sense.

How to unlock customer value again?

The starting point is pulling together a single customer view from the myriad of systems within your MarTech world.

It’s often easier than you think.

Identifying the most critical sources, extracting the data, and stitching together into a SCV can actually take weeks, not months!

Value tiers reveal what’s really going on

The Pareto Principle allows you to get a quick snapshot of where value sits in your customer base.

 Then you can devise VIP, reward (not discount), &/or activation strategies.

For an entertainment client, we pulled two tech systems together to create a single customer view based on event attendance.

entertainment customer pyramid

Then we identified that 54% of value came from 30% of their members. A little flatter than normal. Not the 80/20 that we were expecting.

Something was going on.

We delved further into the remaining 46% of value and found gold.

That 70% of the overall base had only attended one entertainment event! The client never knew this.

The opportunity was obvious. Entice people to one more event. And reward (not discount) repeat attendance.

This led to a strategic overhaul of the event experience and promotion.

Here’s another one for wealth in Australia

If you look at the same type analysis for wealth in the Australian population, then it reveals this: 63/20. Or 84/40. Sadly, identifying that a new societal strategy is needed.

pyramid of wealth - Australia

Have you looked at your customer base this way?

Have you assessed your customer / member base, or loyalty program recently for value and engagement scoring tiers?

If you’d like to discuss this approach further, then drop us a message here

It may just unlock a whole new level of value for your business, and ultimately your customers.