#4: Generate Revenue via 80/20 Rule + Power of Niching Down
Updated: Aug 16
Companies overthink growth.
They over invest in the analysis + strategy side of the equation. While the output of this analysis is useful in the beginning, diminishing returns kick in pretty early but they keep going.
Unpopular opinion but the reason for this is the leaders allocating the resources haven't “carried a bag” before.
Because of that, they don't realize or don't want to admit that they're reverting to their comfort zone because...well, they haven't carried a bag before so they continue to invest in "thinking" vs "doing".
There's a better way.
Pareto Principle aka 20% of your inputs drive 80%+ of your outputs.
Aka 20% of your clients drive 80%+ of your revenue + profitability.
So when it comes to growth, do these 3 things:
Assess your P+L, identify the 20% of your clients driving your 80% and develop 1-3 differentiated personas within the 20% by niching down as much as possible
Develop a hypothesis around the critical problems you're solving for them, why they're in business with you etc + develop a digital elevator pitch to share with "look alike" targets that are most likely to buy your product or service
Narrow your focus to one digital platform (strongly recommend Linkedin) to target these look alike audiences for 30 consecutive days via your digital elevator pitch
Optimize for sales cycle velocity because, well, if you have SCV, it means you've identified a systematic way to grow your business.
Do it again + again.
Make it systematic.
January 7, 2021 (Tweet Link)