Beware the 80:20 rule in Customer Service

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Is it detrimental to focus more on the quality of service for the HNI customer?


Every company has a special mandate for managing and servicing their HNI (High Networth Individual) customer. They provide the bulk of the revenue that a company makes and comprise of roughly about 20% of the total customer base.

The Pareto 80:20 rule is an accepted norm in business. Companies vouch for 20% of the customer base giving them 80% of their revenue (or thereabouts). Those 20%, or Bullion20, are precious and must be given special care. The mandate is to deliver the best experience to the Bullion20 to ensure their loyalty remains undeterred towards the company. And this is fair; you can’t loose the goose that lays the golden egg.

But while there is intense focus on the Bullion20, the Average80 is given the orphan treatment; the quality of service is compromise and the customer experience is often below par. Which is grossly unfair. Besides being unfair, what most companies’ overlook, is the detrimental impact of treating the Average80 shoddily.

Though they don’t give as much revenue, the Average80 deliver something far more precious to the business: credibility. It is this credibility that can take a company to dizzying heights of prosperity, of which revenue is a byproduct.

Treat the Average80 well and it will engage them to advocate the company’s service and commitment, building the image of the brand in the eyes of the potential customer. The voice of the Average80 has tremendous strength; their large number can make a whimper sound like a roar. Treat them shabbily, and they have the capability to turn the citadel of all the positive marketing and advertising to dust.

While the Bullion20 is the cash cow, the Average80 is the foghorn that proclaims the company’s credibility. Both need undivided attention. Miss either one and either revenue or credibility is lost. Revenue can be recovered, if the company has the support of the customer; but losing credibility is a long lasting detrimental impact; very difficult to recover from.

Tread cautiously. Choose wisely. Manage prudently.

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