The principle was suggested by management thinker Joseph M. Juran. It was named after the Italian economist Vilfredo Pareto, who observed that 80% of income in Italy was received by 20% of the Italian population. The assumption is that most of the results in any situation are determined by a small number of causes. (SOURCE: https://www.entrepreneurs-journey.com/397/80-20-rule-pareto-principle/)
Scaling an affiliate program takes time! Launching an affiliate program for your brand means ensuring that trust is developed with the affiliates + influencers who join your program and whom plan to market it to their traffic bases via many variations of internet marketing channels. Keeping your current affiliates and Influencers happy while scaling and recruiting more affiliates and influencers to your program can be a juggling act. Large brands often times hire outsourced agencies such as HPC Management Inc to manage the communications and recruiting of a large scale affiliate + influencer program as it takes a tightly-nit team to facilitate this task.
80% of your affiliate program revenue will come from 20% of your affiliate + influencer partners. It is imperative to ensure that affiliates are excited after they sign up for your program and become what we call "active" you might have 10,000 affiliates + influencers in your affiliate network program but it wont matter if only 3% of them are actually active. Communications offering fantastic promotions and making the smallest percent of the overall 80% excited to market your brand will get more of them "active" so you can continue to expand your 20% base of sales producers.
Why Understanding the Pareto Principle is Important to Scale an Affiliate Program
Increasing sales in your affiliate program means increasing the number of actively producing affiliates in the program. It is imperative that large brands who want to increase their affiliate programs sales have a very aggressive overall recruiting schedule for all types of affiliates. You do not want to be dependent on a few coupon affiliates, you want to increase your new site visitors through the channel while increasing sales so recruiting Influencers in Social media, content marketers from the blog world and adding and partnering with mobile sub networks and PPC agencies who act as affiliate partners is imperative to growth.
YES you can focus on fantastic communications to your top 20% sales producers but leveraging and growing your 80% base will ultimately lead to a bump in your 20% of sales producers.
If you have any questions about recruiting affiliate + influencer parters to your program please reach out to HPCManagement.co