What do you do all day?
Seriously, do you know?
I would bet most of us do not. We are salespeople. Entrepreneurs. We like the so-called flexibility.
You may have some structure to your day but by 10:00 AM most are off and running doing a variety of different things.
But, if you understand these three rules you could skyrocket the results you get!
THE 3 RULES
Before I share the rules with you I want you to do me a favor…which is ultimately doing yourself a favor.
When I share the rules with you I want you to not consider whether you already know the rule but rather ask yourself do I follow the rule.
There is a big difference there. Many of us, me included, will commonly read or hear something and think to ourselves, “oh, I already know that.”. But too often we don’t actually do what we know.
So, can I get your commitment? That you will not just hear the rules but rather truly consider whether you are applying those rules in your business and even your life?
If so…let’s go.
You’ve almost certainly heard of Rule #1. But don’t stop reading these even if you’ve heard it because you might miss a huge nugget later on.
You may even know this rule by different names.
The Pareto Principle
The 80/20 Rule
The Law of the Vital Few
Principle of Factor Sparsity
Yeah, that rule. The rule that has been proven time and time again and seems to pop up everywhere.
The rule originated from Vilfredo Pareto who was an economist who identified that 80% of the land in Italy was owned by just 20% of the population.
Nowadays we see this in all sorts of different areas including:
- World GDP: Richest 20% control 82.7% of the income [source]
- Software bugs: Fixing the top 20% of bugs eliminated 80% of system crashed [source]
- Sports: 20% of the exercises produce 80% of the impact [source]
- Safety: 20% of hazards produce 80% of injuries [source]
And I could go on and on and on, but I think you get the point.
The 80/20 rule appears everywhere!
You probably realize how this applies to you. 80% of your results will come from 20% of your activities. 80% of your closed business comes from just 20% of your sources. 80% of your time spent only produces 20% of your results while 20% of your time generates 80% of your results.
Applying the Rule
Here is what you do with this knowledge…not just knowing, right? It is about applying the rules!
You must identify your top 20%.
- You top 20% of activities
- Your top 20% sources of business
- Your top 20% past clients referring you business
- Even your top 20% of employees
When you have truly identified your top 20% you have a huge opportunity. The opportunity is in eliminating the bottom 80%. Or at least as much of it as you can.
You can eliminate the bottom 80% through:
- Deleting: delete or eliminate it completely if you don’t need this activity, source, employee, etc.
- Delegate: if you are unable to delete it completely consider delegating it to someone else so you don’t have to spend time and energy on it
- Defer: non-urgent tasks that do not produce results can be deferred until all other tasks are completed
- Demote: demote the activities or time it takes through automation
Stay with me here. My bet is that you’ve heard some of this before but I don’t want to lose you because the real power is in these two additional rules.
Ready for Rule #2? It is similar to Rule #1 but even more powerful.
It is the 64/4 rule.
Here is how it works…
If we 80/20 the 80/20 rule we end up with the 64/4 rule.
80% of 80% is 64%.
20% of 20% is 4%.
In other words, 64% of your results come from just 4% of your efforts or sources or past clients.
Can you see the power in the 64/4 rule?
If we gain productivity from understanding and applying the 80/20 rule just think about what you could do by applying the 64/4 rule.
Instead of focusing on 20% of the activities or people you can focus on just the top 4% and still get most of the results you desire.
Let me share Rule #3 and then I will show you how you can combine all these rules together for maximum opportunity and benefit to you!
Maybe you’ve already guessed where I was headed…
Rule #3 is the 51/1 rule.
Yep, we 80/20 the 64/4 rule and we end up with the 51/1 rule:
80% of 64% is 51%.
20% of 4% is .8% or, if we round up, 1%.
Just 1% of your activities produce 51% of your results!
Just 1% of your past clients refer you 51% of your the referrals you receive.
This is POWERFUL!
EASY AS 1, 2, 3
Now, let’s combine these 3 rules together.
And since I am in the business of helping my customers get more repeat & referral business from their past clients I am going to use these rules to apply them to generating referrals.
80% of your referrals come from 20% of your past client database and…
64% of your referrals come from 4% of your past client database and…
51% of your referrals come from just 1% of your past clients!
So, what do you do with this knowledge?
We spend our time where it belongs when marketing to past clients.
Most of your energy and focus should be on your 1%. But you shouldn’t neglect your top 4%…or your top 20%…or even your 80%. You just need to do it in different ways.
It is about layered marketing. Layered marketing is your key to generating more referrals, with less time and less money.
Everyone needs to hear from you regularly to stay top of mind!
What you do is automate your stay-in-touch campaign to your entire database. You can do this pretty easily using email, mail and phone calls. We provide all the details within Database Gold.
Then you spend some specialized attention with your top 20%. Say through gifts or events…which we give you inside Database Gold.
Your 4% group gets even more focused attention while your 1% get as much attention as you can give them.
There are all sorts of ways you can do this. Just get creative. Consider what your clients want from you. Or what they would consider specialized attention. And then put that in place to offer even greater service or attention to your best clients.
This isn’t rocket science but it does take some time and creativity to put in place. I have no doubt you already have some of this in place and could put the rest in place over time. Or you can do it the easy way…using Database Gold. We’ve figured out what works and what doesn’t. We provide you all the content you need so you don’t have to spend your time doing it (see, that’s how you apply the 80/20 rule). And all for a nominal cost that would almost certainly pay for itself through one closed referral.
Repeat & referral business is the single most effective source of business for any sales person…period!