The Pareto rule in marketing revisited
Daniel McCarthy and Russell Winer re-examined the 80/20 rule across customer datasets in Marketing Letters. The top fifth of customers accounted on average for about two thirds of sales, and for about 59 per cent in subscription businesses. Their conclusion is that the rule overstates concentration, though by less than the Ehrenberg-Bass 60/20 figure suggests.
Daniel McCarthy and Russell Winer re-examined the 80/20 rule across customer datasets in Marketing Letters. The top fifth of customers accounted on average for about two thirds of sales, and for about 59 per cent in subscription businesses. Their conclusion is that the rule overstates concentration, though by less than the Ehrenberg-Bass 60/20 figure suggests.
Written from the verified research record for article 56.
What our sources record
Reproduced as it was written when this source was checked, figures and all.
doi:10.1007/s11002-019-09490-y. Average top-fifth share about 0.67; subscription businesses about 0.59.