The 20-80 rule reflects the idea that ________.
A) the top 20% of customers often generate 80% of the company's profits
B) the top 20% of customers are highly satisfied and 80% of customers will recommend the company to a friend
C) 20% of customers are unprofitable, and 80% make up a company's profits
D) 20% of the company's profits are generated by the top 80% of customers
E) any new product offering will be accepted by 20% of the customers immediately, but 80% of the customers will be up for grabs throughout the product's life cycle

Question

Quizplus · Accepted Answer

The 20-80 rule, also known as the Pareto Principle, states that approximately 80% of effects come from 20% of causes. In business, this principle is often applied to customer behavior, meaning that 80% of a company's profits come from 20% of its customers. This means that companies should focus their attention on the top 20% of customers as they are the ones generating the most profits.

The 20-80 Rule Reflects the Idea That ________