The Pareto Principle is a key factor in your marketing success. It boils down to the fact that you get 80% of your results from 20% of your effort. It can apply to all aspects of your business - phone calls you receive, your customer base, the popularity of products and your advertising.

What the 80/20 rule really means is that four-fifths of what you do are a waste of your time. Only one-fifth of it matters. Find out what that one fifth is and you can grow your business to the next level.

Here is what you really need to know about the principle…

Online Advertising

Let’s look at how the 80/20 rule relates to your online advertising. In a digital world, you can bet that most businesses are utilising ads from the big players like Facebook and Google. But are all of those ads a success? The 80/20 rule would indicate that you are getting 80% of your website traffic, leads and sales from only 20% of that advertising.

Let’s pause there for a second and just give a little disclaimer. The numbers don’t have to be 80 and 20. Realistically they could be 70 and 30, or even 95 and 5. It is not the numbers that matter, but the premise of the rule. You generally get the highest amount of return from a very small corner of the market.

So to make the most of your online advertising dollars, use the 80/20 rule to analyse and tweak your campaigns. Look for…

  • How many clicks each of your ads are getting

  • Where your traffic is coming from

  • What is converting

  • The locations you have the most success with

  • Which ad formats give the most return

  • Your page views

  • Where your visitors spend most of their time on your website

  • What the spend is from each customer and their frequency

When you have done the analysis and found the top results, these are the areas you should focus on with your advertising spend as it is proven to give you the best return on your investment.

What Does It All Mean?

In the beginning of your online advertising, it is a little bit like firing a shotgun. You fire once and hope that the spread of buckshot hits something. When you get that hit, you can start analysing what you did to get it. Have a look at what worked and why it worked.

Was it the copy, was it the image, was it the audience you targeted, or the forum you advertised on? Understanding all of those things will help you to replicate success with your future advertising campaigns.

You will be using the 80/20 rule on an ongoing basis. Online advertising changes frequently and you might think that you have nailed the formula. But then the algorithms may change and you are tweaking again. Constantly evaluate which 20% of your advertising is giving you 80% of your results, then replicate it. But don’t stop there, as the rule will apply again and again.

Be vigilant in going after the big gain for small effort!