How the 80:20 principle can improve your business

Back in 1906, Vilfredo Pareto looked at who was wealthy and who wasn’t in Italy.  He discovered that 20% of the population had 80% of the wealth.

It wasn’t until the 1940s when Joseph M Juran took this a step further.  He started to see the same 80:20 ratio in different areas.  He named it the Pareto principle.

Pareto RuleHow the Pareto principle applies to your business

Take a look at your business.  You’ll see that:

  • 80% of your income comes from 20% of your customers.
  • 20% of your products/services generates 80% of your sales.
  • 80% of the complaints come from 20% of your customers.
  • You use 80% of your time to achieve 20% of your results and,
  • 20% of your time generates 80% of your results
  • 20% of your advertising generates 80% of your sales
  • 20% of your customers generate 80% of your referrals

I could go on, but you get the picture.  Now, it may not be exactly 80:20 ratio.  In some cases it may be nearer to 70:30, but the fact is, a significant volume is being created by something small.

How this improves your business

Take some time to look at your customers.  Work out which are the 20% that are generating the 80% of your income.  Then, using the customer profiling tools, create a customer persona.

Now look at your advertising ratio.  Where did 80% of your customers come from?  And which advertising created 80% of your income?  This is important as, what you want to attract is high profit customers, rather than lots of low profit ones.

Double check to make sure the customers you want to attract came from  that advertising.  Then, invest more money into that advertising.

You can take this one step further and investigate your customer:income ratio.  Create a table putting the customers into fifths (so every 20%) based on their value.  Create personas for each, look at where the customers are coming from (on an advertising basis).  Stop the advertising to the lower end customer and invest more in the upper end.

Use it to analyse your products/services.  Which ones are making you the most money?  Once you know this, is it worth investing more into this and dropping those that aren’t?

To show the value of this, I’ll share an insight from when Graham, my partner, had his shop.

When Graham bought the Grinning Demon,  he bought a comic shop.  Over the 13 years that he ran the shop, things changed.

Comics sales started to drop.  There were changes in the big name comics that loyal readers didn’t like.  Graphic novels (buying a series of weekly comics in a hard back book) became more popular.

Whereas before he could count on the weekly comic sales to pay the overheads, he was soon falling short.

When I met him, he was diversifying into Board Games and Graphic Novels.  This is where the sales were being made.  Unfortunately, it was too late and he closed the shop a year ago.

Had he applied the 80:20 rule, he would have seen the shift in spending and revenue.  He could have adjusted what he was selling to reflect the changes.

Graham reflected “I knew comic sales were down.  I just thought it was a ‘blip’ and they’d pick up.  I realised, too late, that it was a permanent thing.  By this time I had run out of working capital to invest in the things that were selling’.

Using the 80:20 rule across your business gives you a snapshot of what is working, where to focus your time.  It also creates red flags, warning signs that you may miss in the day to day running of your business.

How the 80:20 rule can reduce customer complaints

80% of your complaints come from 20% of your customers. There are two questions to ask here.

  1. What are the complaints about?
  2. Who are the customers complaining?

What are the complaints about?

Look at what the customers are complaining about.  Is it the customer experience or is it about the product.

Is it a misunderstanding about the product – how to use it, what happens etc?

If so, then use this to create a fact sheet for customers addressing these issues.  This is a way to add value AND reduce complaints.

Are their complaints valid?  If so, look at the product and ask if it’s worth selling or look for an alternative supplier.

If their complaints aren’t valid then look at the customer themselves.  Where do the fit in the customer value table?  If it’s down the bottom, then ask yourself, is it time to say goodbye to that customer?

Using the Pareto Principle with referrals

Referrals are a business owner’s best friend.  They cost nothing in advertising and they already trust you.

So, who is sending you referrals?  Look again at your customers and see who these are.  Find a way to thank them and encourage more referrals.

Applying the Pareto Principle to your time

Using the 80:20 rule, you spend 80% of your time on trivial tasks and only 20% of your time on tasks that are vital.

It will be different for every business, but find a way that you can shift this.  Use priority lists, rather than to-do lists.  Identify the key tasks that will make a difference and do these first.

For me, the 20% rule means I need to find time in my day to work on attract new customers.  So, I schedule an hour a day to work on this (such as writing articles, organising advertising etc).  This is the first thing I do everyday.  Once that’s done, I can then do the things I am paid to do, knowing that there is a steady stream of new customers.

Using the 80:20 rule to make key business decisions

The 80:20 rule applies across our lives and can be addictive.  Once you see the truth in it and the power it gives you, it will form part of your business decision process.

You no longer have to guess at where to advertise – the 80:20 rule will give you the facts.

You will know which products/services to stock as you know the ones that bring the most profit to your business.

You will know which customers to avoid and which to nurture.

While this tool has been around for nearly 70 years now, it still holds true.  And, when used, it can create the difference between a thriving business and a failing one.

How to write articles for your website

You want to write articles for your website – that’s great!  But how do you do it?
Here’s an outline of what to write about, how to write.
There’s a free download of headlines for you to use.

Not sure why you should write articles?  Read this first.

Different types of articles

Start by deciding what type of article you are going to write.  If you’ve forgotten how to create a Post (as it’s called in WordPress) then Using Your Website will remind you.

1. How to… and Tutorials

These provide helpful advice to your customers. They are factual and you can provide answers to questions your customers are asking.

2. Lists

People love lists. I’ve used this in my articles, such as 21 reasons to have a website and 7 ways to market your business. While there is a temptation to do a large list, try to keep them under 50 items as the points get weaker towards the end. Not only that, few people will read them all.

3. Resources or Link Lists

Is there something you could share with your customers that compliments your business? Then write about it, it might be something you use.

There’s nothing wrong with recommending something that you think your customers will like.

4. Cheat Sheets, Check Lists and To Dos

Provide valuable things your customers will use and you’ll be increasing your value. Perhaps it’s a check list for packing for a holiday – put your products/services in bold!

Have fun with this, and weave in your products 🙂

5. Reviews

Review your products. Test them and then tell them what you like and what you don’t. People like honesty, they know not every product is perfect. If you’re upfront with them about the bits that aren’t great, they’ll be more likely to trust you.

Get others to review the products for you. What they liked and what they didn’t.

6. Controversial Posts

If something’s happening in your field that you don’t agree with then why not write a post about it? This is a brave stance to take but, if done well, can set you apart from your competition.

7. Videos

Provide a post with a video that supports what you’re selling is a great. This might be a video from the manufacturers or one you’ve created yourself.

8. Interviews

Interview clients or those in your field (if you can). You can do this face to face, over the phone or by sending a set of questions out. It’s a great way to get testimonials from customers. Not only that you’ll discover what they think about your business.

9. Guest Posts

You don’t have to do all the writing! Why not ask your customers to write for you or reach out to the manufacturer and others in your field.  Quite often manufacturers have articles you can reproduce on your website (remember to credit them).

10. Case Studies

Take a customer and follow what they do. Start with their problem, talk about what happened and detail the outcome. You could combine this with a video interview (or video of the customer using your product).

So, that’s a quick outline of the various types of articles you can write. The next question is

How to structure articles

They will all start with a headline. To help, I’ve created a ‘cheat sheet’ of headlines for you to download.

Why is the headline important?

It’s normally the headline that provides the text for search engines and social media. This means you want to write a good one to get people to click to your website.

Once you’ve written the headline, think about content.

Take the reader on a journey

You want to take the reader on a journey (don’t give away the answer in the first paragraph), but you don’t want to bore them.  Make sure there’s a reason for them to read on.

Remember that people don’t read large paragraphs of text online. Keep your sentences short.

Use headings to break up the text

Headings mean that people who scan read can find what they want. They should tell the story, but again, not give away the answer.

Try to keep the language simple. I write everything using Hemingway. It pulls me up when I use adverbs, etc and grades my writing, so I know it’s easy-to-read

Writing at an easy-to-read level doesn’t mean you ‘dumb down’ the content. The idea is people to forget they are reading, not stop in wonder at your use of vocabulary.

Images tell the visual story

Don’t forget to include images that help tell the story.  It’s a great way to showcase your products.

What is the ideal length?

There’s no right answer for this. I’ve read articles that have been over 5,000 words. I’ve also read short ones.

Aim for at least 500 words and try for more. But don’t pad it out, again, you want the customer to read the article not get bored.

Link to other articles

As you start to write articles, you’ll be able to link into others. The longer someone spends on your website, the better.

If there’s an article that seens to fit with what you’re writing, then link to it.

Call to Action

You may or may not want to put a call to action at the end of the article. My rule of thumb is, if it’s natural to do it, then add it in. If not, then leave it out.

But, do make sure you ask the customer to do something, even if it’s “if you enjoyed this article then you may like this one”.

Tell the customer what you’d like them to do next.

Don’t forget your free guide to headlines

Download your free guide to headlines and get started.  If you have any questions, get stuck or would like me to have a look at what you’ve written, then get in touch.

Why you should write articles for your website

Having a website means that people can find you on the internet.
But is there more you can do?
The answer is yes, and it’s called content marketing.

Content marketing is writing articles for your website. It takes work and commitment, so is it worth it?

Let’s have a look.

1. Improves your SEO

SEO is search engine optimisation. Every website has something called Page Rank. Google, and others, use this to decide whether to show your website in search results.

The more pages your website has, the more ‘authority’ the site has with Google. By writing articles and increasing the size of the website, you’ll be improving your Rank.

2. It humanises your business

People buy from people. That’s why your About page is one of the most visited pages on your website.

People are nosy and what to know more about you. By sharing stories, case studies in your articles, you become more human, and that’s a good thing!

Which leads to number 3.

3. You become an authority in your field

Take some time out and find your local competitors. Have a look at their websites and think about if you were the customer.

Which one stands out for you?

If you’re like me, it’ll the one with lots of information, helpful guides, hints and tips? One that answers my questions?

And that’s what writing articles does for you. It puts you above your competition. It gives a reason for your potential customers to stay on your website. With each article they read, they develop more trust in you and your business.

It is surprisingly easy to become an authority in your field as very few local businesses do this.

4. Improve conversion rates

At the end of the day, you have a website to generate sales. The more articles, the more information you have on your website, the more enquiries you’ll receive. The graph below shows this clearly.

5. You’ll show up more often in Search

Not only does having more articles improve your page rank, you’ll show up more often. There’s a phrase called ‘long tail search’. It’s where people search using questions or long phrases. Things like: How to create the perfect About page. Guess what, I’ve written an article with that as the title.

Think about what people will be searching for in your business. What questions do you get from customers. Then write an article on it.

6. Supports your social media

Social media is about being social. Instead of sharing your home page, you’ll be able to share articles that people will want to read.

And, if they’re interesting and relevant, then people will share these articles for you.

You may find people ask questions based on your article, giving you a great way to start a conversation.

7. Other websites may link to you

You never know, someone out there may link to an article on your website. So you’ll be receiving traffic from another source. It depends on your field and what you’re selling of course, but this is possible.

8. Increases leads

Another statistic is that, the more content you have on your website, the more leads you receive. The ideal number of pages is 400, but don’t let that put you off. Every time you press publish, you’ll be a step closer. And, it won’t take long before you have a larger website than your competitors.

9. Demonstrates the company is alive and well

Having new and fresh content on your website tells people you’re still trading. It’s reassuring and, again builds trust.

Use news items, case studies in your articles to show that you are alive and kicking!

The Downside to Content Marketing

There is a downside. Writing content takes commitment and, to do it well, consistency.

It may not sound much to write an article once a week, but trust me, it is very easy to let other things take priority.

But, if you can schedule the time to do this, the rewards are worth it.

What do you write about?

There’s lots of things to write about, but even I get stuck at times. If you find yourself wondering, then head over to my Writing Articles post and you’ll find 100 ideas to help!

How to identify your ideal customer

Creating A Customer Profile

The biggest mistake you can make is not thinking through the profile of the person you are targeting.
You want to attract those you want and repel those you don’t.

 

1. Who are you selling to?

There’s a common misconception with business owners that we want to sell to everyone. After all, what we do is incredible so why wouldn’t everyone want to buy it?

The problem with this is that it results in unfocused marketing, it wastes money and energy. It’s far better to realise that not everyone is going to buy and actually we don’t want everyone as a customer.

2. It’s more than statistics

When thinking about your ideal customer, you think beyond the statistics. Also known as demographics, these are things about your client. Their age, gender, marital status etc.

These things help identify groups of customers but we want to go deeper.

3. Introducing Psychographics

Psychographics is a deeper understanding of our customers. We look at their likes and dislikes, hobbies, lifestyle, attitudes.

Once we have this information, we can segment the first group further.

We can identify places where our clients ‘hang out’ and then use these to approach them.

4. What keeps them awake at night?

Marketing basics is about filling a need or solving a problem for our customers. Thinking about what keeps them awake at night, gets us to think about what we’re selling. We move away from the practical into the real reason people are buying

Think about it this way.

Who wants to buy a mix of plastic, metal and wiring? After all, that’s all a drill is.

People don’t buy the drill because they want the thing. They think they buy the drill because they want a hole.

But actually, what they want are the feelings the get when they see the picture that they put up by using the drill.

The picture might be family, so it reminds them that people love them and they love in return.

The picture might be a favourite place, so it reminds them of a time when they felt calm and happy.

The picture is a trigger to feelings and those feelings are what makes the person feel good.

So our aim, in this section, is to think about what motivates the person to buy your product.

  • What is it they want from it?
  • How do they want to feel?
  • How does it work with their dreams?
  • How does it help reduce their fears?

5. Putting it all together

We’ve covered what we need to do, the next question is how to do it. You can print off the free workbook or use a blank piece of paper, whatever is best for you.

Work your way through the questions. Think about customers you have, particularly the ‘good’ ones. These are the ones that are loyal, that spend money, that you want more of.

As you go through the workbook, there may be questions you can’t answer. Try to find them out. The more information you have, the better.

Do this for the clients you don’t want too. You’re looking for similarities across both the groups and differences.

6. Creating your customer profiles

Then, put the information together. Give the customer a name. If you want, find a photo on the internet and give them a face! Don’t forget to create one for those you don’t want.

This is what we are going to use to attract more customers that you want. It will impact every decision you make. So, when considering advertising, you ask yourself, will my ideal customer see this? If the answer is no, then don’t waste your time and money.

This exercise takes about 30 minutes. Find those 30 minutes and work out who you want your customers to be.

Download your Customer Profile Workbook

Introduction to websites

Confused about websites?  Wondering if you should have one?  Not sure how to or what to put on it?

Here’s a Back to Basic guide to websites, telling you what exactly is a website, why web design is important and how to promote it.

Having a website for your business is no longer a luxury.   9 out of 10 people research a business online first.  Over half of consumers don’t trust a business without a website.

With people searching on mobile phones now more than on a computer, your site has to be responsive.  That means it needs to look great, no matter what device they’re using.

What is a Domain and why do you need one?

A website is information on the internet that other people can see.  Every website has it’s own address, called a domain, for example, www.clairepitts.com.

You don’t actually buy the domain.  What you do is pay to use it for a period of time. One thing to note is the domain should be registered in your name, not someone else’s.

When choosing a domain, think about how it’s going to be used.  You may have email addresses that use the domain, so you’ll want it to be easy to remember and spell.  The other thing to consider is whether to have .com or .co.uk.  For local businesses, .co.uk is perfect – it shows you’re a UK based company.

Where does the website live?

Once you have a domain name, you then need somewhere to host the address and your website.

Websites live on a computer, called a server.  The server belongs to a company who looks after the maintenance and security of the computer.  They connect the server to the internet so that people can view your website.  This is called ‘hosting’ your website.

Now that you have an address and a place to store the files and information for your website, you need some software or code to create the website.

Websites can be created using a variety of programs.  The code for creating them is html, css and php (although there are many others).  But, don’t worry, you don’t need to become a computer programmer!

There’s software out there that can create your website for you and the good news is that it’s free.  It’s called WordPress and it’s what I use for the majority of my clients.

WordPress is great to create websites on.  It does a lot of the hard work for you.  If you’ve already had the design and basic information added to the site, you can really easily go and add or change things without having to pay someone like me to do it.

What information do you need on your website?

To start with you need a home page.  This is the main page of your website and it’s the one visitors see when they type in www.yourdomain.com.

You’ll need an About page, a Contact page (with a form they complete) and then, after that it’s up to you.  It will depend on what your business does and how you want to use the site.

If you are selling products or services from the website, you’ll need an eCommerce store.

You may want to provide information and articles to help customers, often called a ‘blog’.

To give you an idea, a basic website tends to have 4-5 pages, a complex one can have many hundreds.

Design and your website

Design is a personal thing, but there are some basic elements to consider.

Whitespace: It is the space between columns, between lines of type or figures that provides visual breathing room for the eye.

Above the fold: What does a person see when viewing your website.  It’s impossible to know where this point is, but make sure there’s enough information above the fold that reassures the visitor that they are in the right place.

Colour: While colour is again personal, colour, and it’s use, can make a huge difference to the impression of your website.  Certain colours make us feel safe, others alarm us.

Typeface: Typeface or font is how the letters are formed or styled.  Some are easier to read on the internet than others.  If you’re not sure, stick to fonts like Verdana that are easy to read and found all over the internet.

Flashing/Moving: Things that flash or move take longer to load on a website, so try to limit these.  Unless they add something, avoid using flashing or blinking text.  Moving text is ok, as long as it doesn’t detract from the website.

What else do you need?

Think about a way you can get visitors to give you their email addresses by offering them something in return.  It could be in the form of a report, how to guide, video or discount.

This is a great way of getting leads and then using these leads to keep contact.  Send them information that will develop trust and that they would be interested in receiving.

You might want to link your site to Google Analytics.  This gives you a huge amount of information about how customers are using your website, which pages they spend time on and which ones they leave.  You can then make updates and changes to your website based on this information.

Provide links to any social media accounts you have and also provide ways people can easily share your website on social media.

Often, someone will be going to your website to find out how to contact you or find your business.  Make this really easy for them and have your telephone number and street address visible on every page and think about having a map.

Now that you’ve got a website, how do people find you?

Getting Found on Google

The first thing I always tell clients to do is register their business with Google.  You will need a Google account and then it’s simple to register your business.

This way, your business will show up when people search for what you sell in the maps view.

The next way is to advertise.  Pay Google to advertise your business for you.  It’s relatively cheap and a quick way to get visitors to your website.

Advertising on Google is not straightforward, so you may need some help setting the advert up.  Be careful to watch how much you’re spending compared to how many sales you make.  But, done well, this is a cost-effective way to get visitors and make sales.

Promote your website on your ‘offline’ media.  Have it on posters, flyers, letters and business cards.  People will go and look at a website from a flyer, so don’t forget to include it.

What about Social Media?

I’m often asked about social media and whether it is worth it.

The answer is, it depends.  It depends on what you’re selling and which social media platform you are using.

Let’s have a quick look at what you can (and should) be doing on the main platform, Facebook.

Facebook

Facebook is a social media platform that’s used by billions of people every day.

If you are a business you will need to have a Facebook Page (don’t use or over use your personal account.  Facebook watches for this and closes those accounts down).

A Facebook Page is the same as a personal one.  You can post updates, share images and links to websites.  People like your page and should, in theory, see your posts.

The thing is, Facebook is a business and wants you to pay for people who like your page to see it.  So very few of your fans will see these posts.

What Facebooks want you to do is advertise.  You can pay for people who have liked your page to see your post or you can pay for a broader range of people to see it.

You may have noticed in your feed posts that have ‘Sponsored Post’.  These people have paid to be there.

Is advertising on Facebook worth it?  It depends on what you’re selling.  People are on Facebook to look at news from their friends and share ‘gossip’.  If what you are selling fits in with that, then yes it’s worth advertising.  If not, then I’d give it a miss.

One thing to mention here is don’t depend on a Facebook Page and not have a website.  You want to get the contact details from your fans into your own database.  Facebook can and does change the rules.  All it takes is for them to close your Page down and you’ve lost everything.

Facebook Groups are worth considering if your customers like to meet and chat.  One of my businesses has a thriving Facebook Group that we set up.  There are regular discussions in the group and everyone sees when we post.

In my experience, I prefer to advertise on Google than on Facebook, but it does depend on what you’re selling.

Getting found by Google without spending any money

SEO, search engine optimisation, is where Google finds and lists your website ‘organically’.  In other words, you don’t pay Google, they ‘find’ you.

It’s the dream of most website owners.  After all, who wouldn’t want to be on the first page of Google search results without paying?

The problem is, Google uses a complex algorithm to decide who to show as a result from searching and who not.  This changes often and is a well kept secret.

This means that what worked last year may not work this year.  I can help.  There are ways that you can get your website on the first page of Google.

If this is something that interests you, then let me know and we’ll talk further.

So, now you know what a website is, what to put on it and how to get people to visit it, the big question is this.

Will you create one yourself or will you pay someone to do it for you?

Web Design by Claire

I would love to work with you to create your website.  I offer low-cost hosting, web design, SEO and copywriting services.  Working with me, you get:

•Website live in 7 days

•Expert web design

•Copy provided (if required)

•Images provided (if required)

•Full training provided

•Free 1 month support

I’d definitely recommend a website by Claire!
Everything set up so quickly and Claire is always so fast at getting back to you for help, guidance or to put something right for us.
Our website was tailored to us and very clean and straightforward.

DIANE PARKER / THE CONSULTING GAMER

Call me on 07887 533845 or complete the contact form.

I look forward to working with you,

 

 

Claire

Why I design websites using WordPress

Your website will be designed using WordPress.
This means you can update and change your website whenever you want.
There’s no hidden charges or fees.

Why WordPress?

WordPress is a content managment system.  Once the website is set up, it’s really easy for you to add new content, images and make changes.

Unlike other web designers, I want you to have total ownership of your website. This means:

  • You own your domain name
  • You have full and total access to the website
  • You can update it and change it without having to use me or a web designer.

With WordPress you are in control.

There are easy to follow guides on how to do the basics and I’m always happy to help if you get stuck.

Is WordPress reliable?

There are currently 19.5 million websites created using WordPress. It runs 14.7% of the top 100 websites in the world. Businesses like New York Observer, New York Post, TED, USA Today, CNN, Fortune.com, TIME.com, National Post, Spotify all use WordPress

WordPress runs 28.9% of the Internet.  This figure alone, along with the list of those using shows it’s reliable.

Does being open-source make it vulnerable?

WordPress is open source. This means the code that runs WordPress is available to everyone. Does this make it vulnerable?Well, yes and no.

Open sourced does make it vulnerable to hacking. In fact, out of the 8,000 infected websites, 74% of them were WordPress sites. But don’t let that put you off.

The most common way sites get hacked is due to an old version of WordPress. You see, WordPress updates roughly every 150 days. Some of these updates are to fix security issues. It’s important that your website is kept updated.

That’s why I offer to keep your website updated for you.

Not only that, when I create your website, I will install the latest code to ensure your website is safe.

How easy is it to use?

If you can type using a keyboard then you’ll be able to use WordPress.  The hard part is setting the website up.  If you want to add new things to your website, like online payments, then that’s relatively simple to do.  If you want me to do this for you, then just ask.

Once a Client, always a Client

I am more than happy to help you with your website.  For me, once you’re a client, you’re always a client.  If you make a mistake or get stuck, then let me know and I’ll help.  If it’s a quick fix, I won’t even charge.

I want you to love your website and for it to be a real asset to your business.

WordPress is trusted by multi-national companies and small.  It’s the ideal platform for your website.