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Definition

In marketing, the eighty-twenty principle (also known as the 80/20 rule or Pareto principle) describes a situation in which a disproportionately small number (e.g., 20 percent) of salespeople, territories, products, or customers generate a disproportionately large amount (e.g., 80 percent) of a firm's sales or profits.[1] This phenomenon is observed across multiple disciplines and suggests a focus on the "20 percent" that produce the majority of output.

References

  1. ^ American Marketing Association. AMA Dictionary.

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