Tag: growth product management

The 80/20 Rule in Growth: Why Chasing Everyone Means Catching No One

Discover how applying the 80/20 Rule in growth strategy helps you focus on high-value customers, boost retention, and drive ROI. Stop chasing everyone and start scaling smarter.

The biggest lie in business growth? That your product is for everyone.

Spray-and-pray is dead. Focus is sexy. And, let’s be real (profitable).

It’s Week 3 of my Digital Transformation & Change Management program by BCG, and the theme is human-centered design. One idea hit like a cold plunge in the morning:

You can’t design for everyone. There are always trade-offs. Trying to please all is the fastest way to delight none.

That’s where the Pareto Principle, or better known as the 80/20 Rule, becomes your north star.

In growth, 80% of your revenue often comes from just 20% of your customers.

The rest? Noise. Distraction. Burned budget.

Your job isn’t to chase the crowd. Stop being everything to everyone.

It’s to find your core. Nurture it. Obsess over it.

Focus is the new growth hack. And it’s wildly underrated.

Customers are not created equal
Depth scales
Personalise for your valuable customers

1. Not All Customers Are Created Equal (And That’s Okay!)

Let’s kill the myth of equality. In reality, a small percentage of your customers are doing the heavy lifting. They’re not just buying more; they’re telling their friends, sticking around, and coming back for more.

Think of them as your VIP section who drive revenue, referrals and repeat purchases.

So, how do you find them? Two growth-grade tools:

RFM Segmentation

  • Recency: When was their last purchase?
  • Frequency: How often are they buying?
  • Monetary: How much are they spending?

LTV Estimation

Estimate the lifetime value of each user:

  • Plot their retention curve based on how long they stick around.
  • Multiply that by their average spend over that time.

This isn’t data science for fun. It’s data science for focus.

Once you know who your MVPs are:

  • Prioritise them like your business depends on it (because it does).
  • Personalise their experience like a five-star concierge.
  • Redirect your marketing spend, creative muscle, and retention strategies to this top tier.

💡 Key Takeaway:

“Trying to please everyone is a shortcut to pleasing no one.”

Serve your stars. Let the rest orbit.

2. Market Size vs. Unmet Needs: Choose Depth Over Breadth

Here’s a hard truth most growth hackers avoid:

Big markets are sexy but stupid if they’re saturated.

Everyone wants a slice of the “mass market” pie, but few realise that the pie is overbaked, overpriced, and overcrowded.

Instead, flip the funnel:

Find the Niche with Pain (and Money)

Zoom in on high-intent, underserved groups.

  • Love, Bonito didn’t try to become a global Zara overnight. They built a cult following by solving one deep problem: fashion that fits the Asian female form. A narrow problem. A massive following.
  • Kopi Kenangan didn’t try to take on Starbucks head-on. They zoned in on Indonesia’s growing middle class craving affordable, consistent, grab-and-go coffee, and built a tech-enabled chain to deliver just that.

Use the Market Opportunity Matrix

The formula for ROI gold:

High Unmet Needs × High Willingness to Pay = 💰💰💰

You’re not trying to win a popularity contest. You’re solving real problems for people who actually care.

💡 Key Takeaway:

“Depth scales faster than width.”

Start narrow. Dominate. Then expand with leverage, not desperation.

3. Personalisation Is the New Mass Marketing

Want to know the most powerful growth lever that’s underused?

Feeling seen.

Once you identify your top 20%, don’t treat them like the rest. Treat them like they matter—because they do.

Roll Out the Royal Carpet

  • Invite-only offers
  • First dibs on new products
  • Tailored content journeys
  • Surprise gifts just because

Loyalty isn’t bought. It’s earned through thoughtful touchpoints.

Predictive Analytics = Superpower

Use AI and machine learning to identify high-potential users early.

  • Someone who refers 3 friends in 7 days? Likely a future whale.
  • Someone who binge-uses your product in Week 1? Roll out the welcome mat, stat.

Retention = Rocket Fuel

Still obsessing over CAC? Shift your lens.

A 5% increase in retention can drive up to 95% more profit.

Retention compounds. Acquisition leaks.

💡 Key Takeaway:

“80/20 isn’t just about efficiency. It’s about empathy.”

You’re not scaling numbers. You’re deepening relationships.

Click here to read more about the compounding power of your customers’ LTV.

Final Thoughts: Focus Is the Ultimate Flex

Let’s be clear. Growth isn’t just a popularity contest anymore. It’s not about who has the most followers, impressions, or viral moments.

It’s a resource allocation game.

And the house always wins when you know where to place your bets.

The winners?

They don’t obsess over being liked by everyone.

They double down on the right ones, the customers who stay, spend, refer, and evangelise.

Growth doesn’t come from being louder. It comes from being sharper.

🫶🏻 Thanks for reading till the end.

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The Margin of Error in Growth Forecasting: Lessons from Statistics

Discover why most growth forecasts are more fiction than fact. Learn how marketers and product managers can avoid false positives, misuse of confidence intervals, and data misinterpretation by embracing statistical literacy in growth forecasting.

“So… how much uplift are we expecting from this new campaign?”

Cue the awkward silence. Some finger math. A squint at last quarter’s dashboard.

“Uh… 15 to 20%? Maybe more if it gets high engagement?”

If you’ve ever been in this situation (I see you nodding while quietly wondering what data actually backs that number), you’re not alone. Most growth forecasts are stitched together like startup pitch decks — part optimism, part momentum, and a whole lot of hope-as-a-strategy.

The real issue? We’re wielding power tools, data, experiments, and statistical models with the precision of a toddler holding a chainsaw. Somewhere between dashboards and deadlines, growth marketers and PMs have mistaken confidence for certainty, ignoring one critical variable: the margin of error that’s quietly laughing in standard deviation.

This post is about that margin. And why understanding it could save your next forecast from becoming fiction.

Fortune cookie Forecast
Confidence is not Certainty
Confidence is not Certainty
Confidence is not Certainty
When AB Tests Lie to you
AB Tests can Lie to you
Checklist for Growth Forecast

1. Confidence ≠ Certainty: Why Your “95%” Isn’t a Guarantee

Let’s clear up one of the most common (and costly) misunderstandings in growth forecasting:

A 95% confidence interval doesn’t mean you’re 95% right.

What it actually means: if you ran the same experiment 100 times, you’d expect the true result to fall within that range 95 times. That other 5%? That’s where bad decisions, over-promises, and “we’re not hitting the target again” meetings live.

Here’s the kicker: most growth projections ignore this nuance entirely. They present the point estimate — the single number that looks good in a slide deck, and conveniently skip the messy reality of variance.

🟢 Think of it like a weather forecast.

An 80% chance of sun doesn’t mean it won’t rain. So maybe keep the umbrella handy before you bet your Q3 goals on that optimistic uplift.

2. The Danger of False Positives: When A/B Tests Lie to You

If you’re running five A/B tests and celebrating because one of them hit p < 0.05, I’ve got news for you: you might just be celebrating noise.

This is the statistical equivalent of fishing with dynamite. The more tests you run, the higher the chance you’ll “find” something that looks significant, but isn’t. It’s called a Type I error: a false positive. The evil twin? Type II error occurs when you miss the signal because your sample size was too small.

⚠️ Analogy time:

It’s like flipping a coin 20 times and getting 12 heads. Does that mean your coin is rigged? Or did randomness just do its thing?

If you base your next product feature on that flip, congratulations, you’ve just built your roadmap on a statistical illusion.

3. Why Every Growth Product Manager Needs a Crash Course in Data Literacy

In too many rooms, “Let’s test it” has become the get-out-of-jail-free card for weak hypotheses and vague KPIs. But here’s the truth:

Growth isn’t magic. It’s math.

And math demands discipline. Sample sizes. Statistical power. Effect sizes. The kind of terms that don’t trend on LinkedIn but separate great growth PMs from gut-feel gamblers.

The real flex? Data humility.

Knowing what your data can’t tell you is just as important as what it can.

🔍 A quick gut-check before your next ‘data-driven decision’:

  • Are your results statistically significant and practically meaningful?
  • Is your confidence interval tight enough to trust?
  • Are you measuring actual uplift, or just random noise dressed as insight?

Final Thoughts

Growth is messy. Forecasts are fuzzy. And despite all the dashboards, most of us are still squinting into the fog, pretending we see clearly.

But it doesn’t have to be this way.

When growth marketers and product managers learn to wield statistical tools with respect, we graduate from guesswork to good work. From throwing darts to sharpening strategy.

🔑 TL;DR Takeaways:

  • Confidence intervals > confidence. Precision beats bravado.
  • Not all A/B test wins are real. Know your false positives from your breakthroughs.
  • Data literacy is the new growth skill. Learn it, or risk being led by noise.

So the next time someone asks, “What’s the uplift?” — don’t just spit out a number.

Ask them: “With what level of confidence?”

Because that question might just save you six months of shipping illusions.

🫶🏻 Thanks for reading till the end.

➡️ Follow Mervyn Chua and reshare to help others.

📌 Save this post for future reference!⁣⁣⁣⁣The Margin of Error in Growth Forecasting: Lessons from Statistics