Most of us have heard about the 80/20 rule. Also known as the Pareto principle, it states that for many events, 80% of the effects come from 20% of the causes. The 80/20 rule is popular in the business world, but it has managed to make its way into investing, nutrition, time management and even marriage. It seems the more we look for this principle, the more places we find it!
As wonderful as it sounds to get 80% of your sales from only 20% of your customers, what if this isn’t the case for your business? While Pareto’s principle is a real thing, you don’t want to make assumptions at the expense of your business. Otherwise, you could severely limit your potential.
Thanks to artificial intelligence, businesses can better understand their data. Let’s look at three ways that AI is challenging the 80/20 sales rule, and think about why your sales numbers might fall outside this principle.
1. Real-time Marketplace Factors
In the past, businesses had to rely on static information to learn about their customers. With artificial intelligence, this information can now be attained in real time. Whether you’re launching a new product, studying buyer behavior, or producing personalized content, you can learn about your audience as you go.
Imagine a company that sells professional coffee machines to restaurants. The initial talks go well until the buyer stops returning phone calls. The obvious answer would be that the buyer is no longer interested. But, what if the manufacturer could dig deeper. Perhaps they lost the sale to a competitor offering a more advanced product or a better price. Knowing this, the company could adjust their sales approach to be more competitive.
2. Intuitive Recommendations
One of the incredible things about AI is that it can weigh many factors at the same time. Humans are limited on the signals they pick up, but artificial intelligence is not. It can gather all types of signals such as a Facebook post or social media conversation. When this information comes together, AI can make recommendations to close more sales. Businesses no longer have to rely on cookie-cutter selling strategies and hope their customers fit the mold.
3. Identification of Communication Channels
Consumers have their preferred methods of communication. Some like getting texts, some like getting emails and some like good old-fashioned face-to-face interactions. But, when you’re dealing with hundreds of clients, it’s hard to remember these preferences. It’s faster and more efficient to send out a mass email or text.
Artificial intelligence, on the other hand, can easily remember who likes receiving phone calls and who likes receiving texts. It steers sales teams in the right direction when communicating with customers, and has the capability to analyze transactional data.
Artificial intelligence can do amazing things. And, for the first time, the 80/20 rule is being challenged. By integrating more AI into your operations, do you think that your successes will fall outside the principle?