The Pareto Principle, also referred to as “The 80/20 Rule,”
is widely used in building out business strategy, but it can also be very useful in online marketing decisions.
The Pareto Principle is also utilized for campaign
management or search optimization. The “rule” implies that in many instances
80% of events is caused by 20% of sources. In business this means that 80% of
sales come from 20% of clients, and in economics it could mean 80% of
wealth distributed amongst 20% of the population. The SEO application of this rule would be to identify 80% of
organic search traffic going to the top 20% of search results.
A common method of utilizing the Pareto Principle in the context
of online marketing is to identify the following -
- 80% of online sales are from 20% of products
- 80% of search visits are from 20% of the keywords (often from brand-terms rather than generic)
- 80% of leads in content marketing are from 20% of the content assets
- 80% of user tasks are performed on 20% of links offered
- 80% of social shares are from 20% of the social updates
These patterns are also called as the long tail distribution in the in reference to product sales. Analyzing existing online marketing activity and identifying what drives majority of online leads and sales. This helps focus attention on areas where making changes will lead to conversion rate optimization
Correctly
applying the 80/20 Rule to Search marketing makes the most and least
profitable investments stand out quickly. It can result in pausing less
profitable things like ad groups or keywords, in raising the budget to allocate
more money to the top 20%.
Reference links -
https://www.searchenginejournal.com/5-ways-use-8020-rule-adwords/134572/
https://www.makeitbloom.com/blog/the-80-20-rule-mastering-ppc-optimisation-when-time-is-scarce/
https://www.smartinsights.com/marketing-planning/marketing-models/paretos-8020-rule-marketing/
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