In a business’ quest to excel, there’s often a tendency to focus on several segments of the target, from hard core fans to casual users. But the “80:20 Rule” has always pointed to better results by gearing efforts toward the smaller part of the customer base that produces the greatest return.
A couple of Decembers ago, Arbitron featured Bill Black, a Starbucks marketing pro, who boiled it down well. Starbucks essentially has two core groups – “Super Regulars” and “Coffee House Enthusiasts.” While other segments contribute to the whole, it is these two types of customers that drive the majority of their revenue.
Most businesses operate this way, and yet, radio programming debates abound as stations often try to “convert” P2s into P1s while often not super-serving those folks who are already very core to the station in the first place.
A new infographic (and a slice of it is below) does a nice job of illustrating the “80:20 Rule.” Note that the rule was first developed more than 100 years ago.
In radio, programmers and managers would do well to truly understand and provide a better customer experience (CX) to their “Core 20.”
But where do you find them? Simple. Vast numbers of them are in your database. And while some listeners who gave you their email address did so primarily to win concert tickets and other prizes, most others are “Super P1s” to your station – the “Core 20.” Using targeted web surveys that filter out these VIP listeners is something our company is actively doing for clients. If you ask the right questions, you can isolate these key listeners, determine their needs, and simply give them what they want.
Like in the case of Starbucks, it often has little to do with freebies, and much more to do with access, communication, special treatment, service, and the ability to participate in discussions about your station brand.
The next time you’re in one of those strategy sessions, and the conversation turns to ways to convert cumers into P1s, think instead about ways in which you can do a better job taking care of the listeners who are already behind you, listening no matter what, and always willing to help you with your marketing.
Your “Core 20” is the secret to continued success.