Sales Series Post #1: Pareto Meets Sales Reps

Angela Kujava Sales

Pareto 80/20 ruleAt some point of life in business, all individuals learn the Pareto Principle—if you haven’t heard of it yet, then today’s that point for you.  Basically, it states that for a given event, 80% of the effects are a result of 20% of the causes.  The “80/20 rule” as it is better known, was proposed by economist and sociologist Vilfredo Pareto.  Pareto’s study of income distribution in the analysis of individuals’ choices pioneered what we know today as “microeconomics”.

The 80/20 rule is applicable to many situations:

  • The best 20% of your clients supply you with 80% of your profit
  • 80% of all complaints arise from 20% of your customer base
  • Fixing 20% of reported software bugs eliminates 80% of crashes
  • 80% of B2B transactions are the result of relationships, 20%…are not
  • and so on

The principle is surprisingly accurate, and as such, often misappropriated.  In fact, research indicates a dramatic discrepancy in the numbers when we look at sales practices.

Several discrete studies, including ones by Harvard University and Gallup, indicate that approximately 4% of salespeople in the United States sell 94% of all goods and services!  According to the Bureau of Labor Statistics, there are roughly 2.8 million non-retail salespeople in the U.S., which means that a paltry 112,000 of them are actually selling effectively.

Top salespeople are supported by a strong process that includes best practice branding, marketing, and sales tools.  A salesperson’s methods must keep up with today’s instant communication (and gratification) demands of customers in order to remain in the top 4% of producers.

This is precisely what Showcase is intended to do—help sales reps sell effectively with a mobile app that provides instant catalog display, order entry, access to sales materials, brand management, and more.