Ok, so I've been promising this article since before Thanksgiving. I have got to sit down and actually write it.
I'll warn you, its a long one, but I've been doing some mega-research, and well, there's no way around its length. But hey, its your browser, so skim it for the stuff that YOU find interesting.
Maybe if I add some pictures of Jedi and some kittens you will keep reading, yes?
If you can't tell by now, Pareto's Principle - the 80/20 rule - fascinates me (Quite frankly, I think there is an entire book hiding in it) . It's so simple to understand, and you can use it to both predict the rate of future growth of your business, as well as to discover the best areas where your business can grow further. (More on that in a minute)
The 80/20 rule is the closest thing I have found to a shortcut in this - or pretty much any - business.
But it turns out that, for the internet marketer, the 80/20 rule may no longer be an accurate way to determine the growth of internet websites.
I actually stumbled across this hidden nugget in a book named Click: What Millions Of People Are Doing Online And Why It Matters. It's written by this numbers-crunchers-genius named Bill Tancer, who is head of one of the first major number-crunching internet-traffic-studying companies called Hitwise.
One of the things he points out is that a lot of websites - especially socially-oriented ones - don't follow the 80/20 rule. Instead they follow a rule discovered by another numbers-cruncher named Jakob Nielsen (nice photo) called the 90/9/1 rule (sometimes called the 89/10/1).
You've already seen this rule in action. Raise your hand if you have a facebook profile or have ever posted a blogpost. (Now, put your hand back down before somebody asks what's going on)
Here's what you will see:
90% of your facebook friends, or blog readers are "lurkers". They read, they move on. Like ghosts.
9% might occasionally comment or stop in and say "hi".
1% are actually avidly commenting, uploading photos, and pestering your news feed (whom you then hide).
Now, sure, this is only a principle. So you can bend the rules. But for those of us that have not yet mastered the Jedi mind tricks of getting our friends and readers engaged, the 90/9/1 rule is a principle that you ignore at your peril.
The reason Bill mentions it in his book is because he was called in to consult on more than one company who had built their website, expecting 20% of their people to be engaged with it.
For those who are bad at math, 1% is a lot less than 20%. Even in Internet numbers.
All Your Niche Sites Are Belong To Us
But even sites that are not dependent on social engagement are mostly controlled by this new principle.
I mean, look at my sites. I have one page on one site that is making all of my bank.
Ok, so my data-set is kind've small. I need a bigger set of numbers to crunch. So I started digging around, looking through income reports, such as those that Pat Flynn puts out every month.
Spencer, at Nichepursuits.com, puts out an amazing number of new sites (like, 20-30) each month. And, recently he posted a few studies about his numbers that absolutely demonstrate this phenomenon. Thankfully, he was amazingly gracious to let me pick apart his numbers for my analysis.
The article that really shows this is "Income Report For 90-day Old Sites". Now, I'm going to encourage you to hop over there and check out his chart.
Basically, out of 20 sites, he had one site that made over half of the income. And 2 of the sites (10%) made up about 70% of that months income!
Spencer explores this concept himself in an article titled "Yes, Building Niche Websites Is A Numbers Game". Here's what he's seeing over all of his sites:
What is surprising, is that after a little more number crunching, he realized that 2 of them - or 20% of that top 20% - were making 70% of his monthly sales!
Sound familiar?
90% of the stuff I write will be a "failure".
I'll warn you, its a long one, but I've been doing some mega-research, and well, there's no way around its length. But hey, its your browser, so skim it for the stuff that YOU find interesting.
Maybe if I add some pictures of Jedi and some kittens you will keep reading, yes?
If you can't tell by now, Pareto's Principle - the 80/20 rule - fascinates me (Quite frankly, I think there is an entire book hiding in it) . It's so simple to understand, and you can use it to both predict the rate of future growth of your business, as well as to discover the best areas where your business can grow further. (More on that in a minute)
The 80/20 rule is the closest thing I have found to a shortcut in this - or pretty much any - business.
The Pareto Principle is all Wrong
But it turns out that, for the internet marketer, the 80/20 rule may no longer be an accurate way to determine the growth of internet websites.
I actually stumbled across this hidden nugget in a book named Click: What Millions Of People Are Doing Online And Why It Matters. It's written by this numbers-crunchers-genius named Bill Tancer, who is head of one of the first major number-crunching internet-traffic-studying companies called Hitwise.
One of the things he points out is that a lot of websites - especially socially-oriented ones - don't follow the 80/20 rule. Instead they follow a rule discovered by another numbers-cruncher named Jakob Nielsen (nice photo) called the 90/9/1 rule (sometimes called the 89/10/1).
The New Pareto's Principle For Internet Marketing
You've already seen this rule in action. Raise your hand if you have a facebook profile or have ever posted a blogpost. (Now, put your hand back down before somebody asks what's going on)
Here's what you will see:
90% of your facebook friends, or blog readers are "lurkers". They read, they move on. Like ghosts.
9% might occasionally comment or stop in and say "hi".
1% are actually avidly commenting, uploading photos, and pestering your news feed (whom you then hide).
Now, sure, this is only a principle. So you can bend the rules. But for those of us that have not yet mastered the Jedi mind tricks of getting our friends and readers engaged, the 90/9/1 rule is a principle that you ignore at your peril.
The reason Bill mentions it in his book is because he was called in to consult on more than one company who had built their website, expecting 20% of their people to be engaged with it.
For those who are bad at math, 1% is a lot less than 20%. Even in Internet numbers.
All Your Niche Sites Are Belong To Us
 |
| Image Courtesy of Anomalous4 on flickr |
I mean, look at my sites. I have one page on one site that is making all of my bank.
Ok, so my data-set is kind've small. I need a bigger set of numbers to crunch. So I started digging around, looking through income reports, such as those that Pat Flynn puts out every month.
Spencer, at Nichepursuits.com, puts out an amazing number of new sites (like, 20-30) each month. And, recently he posted a few studies about his numbers that absolutely demonstrate this phenomenon. Thankfully, he was amazingly gracious to let me pick apart his numbers for my analysis.
The article that really shows this is "Income Report For 90-day Old Sites". Now, I'm going to encourage you to hop over there and check out his chart.
Basically, out of 20 sites, he had one site that made over half of the income. And 2 of the sites (10%) made up about 70% of that months income!
Spencer explores this concept himself in an article titled "Yes, Building Niche Websites Is A Numbers Game". Here's what he's seeing over all of his sites:
- Niche Sites that Earn More than $100 Per Month – 10%
- Niche Sites that Earn Between $30 and $100 Per Month – 20%
-from "Yes, Building Niche Websites Is A Numbers Game " on nichepursuits.com
He breaks down the numbers even further in the article and even goes into the statistics governing other fields, such as sales conversions for cold-calling salesmen (I know some of you are doing that kind of thing), so feel free to click on the link to check out his research.
But, basically, he's seeing a Pareto's principle of 90/10 -- even when the site is not socially dependent
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| The New Pareto's Mountain For Internet Marketers -- Further Proof that Drawing is not in my 10% |
The Take-home Message?
90% of your websites will be failures.
9% will be successful.
1% will be wildly successful.
I was catching up with my brother over dinner the other night. He's one of those crazily successful guys who has "more irons in the fire" than I think I even own. (He's actually getting into the internet thing as well, running Champ's Tech Blog on his new website mycloudfinder.com) I could brag about him forever, but I'll spare you guys.
Remember what I said at the beginning about the 80/20 rule being a shortcut? Well, one month My bro is sitting there with his sales figures and realized that 20% of his salesman are making about 80% of his sales.
No surprise there.
What is surprising, is that after a little more number crunching, he realized that 2 of them - or 20% of that top 20% - were making 70% of his monthly sales!
Sound familiar?
Here's what I'm Discovering:
I need to write a ton of more content on my websites. I need to get the content out there and see which keywords will be picked up by Google and loved by the readers.
90% of the stuff I write will be a "failure".
That 10% will be my bread and butter.
Life is going to throw "no's" at you, no matter what field you are in.
Maybe it's God's way of keeping us humble.
But if we can just realize that life isn't about succeeding at it all -- it's about succeeding in that 10% of our lives in which we are most gifted.
Your Mission This Week
A. If you are having little areas of success in your life, spend the next month working on them to make them bigger. Maybe its a business success. Maybe its a success as being Dad. Work it.
B. If you are not seeing success, than it means you need to "live" more. I commission you to go out and try new things, push the comfort zones and expand. It's all a numbers game and just realize that you need to cast a wider net.
As for me? I'm going to go kiss my wife. It's the 1% of my life that'll make up for the rest of this nonsense.
Come back next week for a review of basic on-site SEO principles. I've paid $10 for an ebook (yes, I bought it on sale) that explains the tips I'm going to share with you for free.
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