80/20 Rule Examples Excel: 3-Sensational Reasons Why PPC Agency Should use Pareto Analysis

Imagine you’re a commander of a battalion whose mission is to capture a town from rebel forces.

Recent successive wins have pushed your enemy into a choke point.

You’re confident the last battle will be the final blow to the enemy.

However, a week before the ‘D-day,’ your lieutenants report various issues that threaten to derail your last campaign. Among the problems facing your soldiers are shortage of supplies and logistical obstacles.

What problems would you solve within the timeframe to guarantee a win in the last battle?

You would probably use the ‘important-vs-urgent’ strategy to solve the dilemma above.

However, how would you know whether you’ve accurately targeted the core issues that contribute vastly to the problem?

This is where the concept of 80/20 (Pareto analysis) comes to play.

The scenario mentioned above applies to pay-per-click (PPC) ad management as well. PPC managers are confronted with multiple problems that need urgent fixing to protect their clients’ ad budget.

Did you know that a handful of 20% attributes causes 80% of the problems you face managing your clients’ Google Ad campaigns?

Imagine troubleshooting the 20% attributes that spell doom to your clients’ ad campaigns.

How much time would you save?

Think of the magnitude of the returns you’ll generate for your clients effortlessly.

Well, as a bearer of good news, we are here to tell you that Pareto analysis is the missing link your paid search ad agency needs to stay profitable in the current recession, thanks to Corona virus.

Stick for 3-minutes because this blog will help you fix any such generic mistakes, preventing you from unlocking your clients’ PPC campaigns’ true potential.

Meet the ‘Insider-Strategy’ that’s Leaving a HUGE Smile on the Faces of PPC Managers Worldwide.

You’re making a money-draining mistake by looking at much more than you need.

You can save massive amounts of time and money by focusing on the areas producing bankable results.

What’s the 80/20 Rule?

The 80/20 or Pareto Principle is based on a theory that most results are derived from a minority of sources.

It’s named after an Italian economist Vilfredo Pareto, who, in 1906, found that 80% of the land in Italy was owned by 20% of the elite population.

The most significant about Pareto’s finding was that this 80/20 distribution occurs exceptionally frequently in today’s world.

For example, in general, 20% of your keywords generate 80% of your clicks. And 20% of your time produces 80% of your results. And so on.

What are the 3-Moneymaking Facts why Pareto Analysis Matters in Pay-per-Click (PPC) Ad Agencies?

Uncover Your Best and Worst Customers as Easy as ‘Ordering Uber’

You have a humongous list of prospects that your clients are targeting. Let’s assume it’s 1,000 potential customers.

Using the centuries-old 80/20 principle, around 200 users will convert.

Believe it or not, it’s 200 users that you should be targeting.

Imagine the resources you’ve saved in terms of time, effort, and ad budget.

Now that you’ve identified the profitable segment, what’s next?

Create a tailored ad and personalized offers to increase the odds of upselling, cross-selling, and long-term loyalty.

Using Pareto analysis, you can identify the worst customers in terms of complaints and refunds.

Remember, 80% of complaints come from 20% of the customers. Using the tool, you can segment your clients’ target market into ‘good’ and ‘bad’ customers for targeted ads and offerings.

You may be losing precious time engaging with and responding to customers who may not be worth the time and effort in the long run.

Setting the right expectations is the best way to deal with customers wasting your time.

Use Pareto Analysis as Your Cheat Sheet to Cut Your Overhead Costs by HALF

If you’re still reading, it’s needless to reinforce that the 80/20 rule reduces your costs tremendously by facilitating you to troubleshoot areas causing horrific damage to your clients’ ROIs.

When used effectively, the tool can trim your overheads and drive your clients’ ROI through the roof.

Essentially, Pareto analysis enables you to target the 20% variables causing 80% of your problems in a cost-effective manner. In other words, you’re able to mitigate risk factors and preserve your clients’ ad spends very efficiently.

Create Ad Content Optimized for User Intent with Profitable Keywords

A keyword analysis is a crucial aspect of digital marketing, which results in a high return on investment (ROI) whenever it’s done right.

Remember, in today’s search engine marketing (SEM); Google gives special preference to user intent rather than SEO.

The search engine giant has invested billions of dollars in training its search engine to evaluate user intent with a significant accuracy.

Are your keywords optimized for user-intent?

If so, which keyword groups drive a significant chunk of clicks to your clients’ Google Ad campaigns?

By applying Pareto’s Principle, you can focus on the main contributors, i.e., champions and losers.

For example, focus on the top 20% of your keywords that:

• Receive 80% of impressions
• Get 80% of clicks
• Generate 80% of revenue
• Waste 80% of the ad spend

Rich Insights Generated by the 80/20 Rule

Before we explain how you can use the chart, you need to grasp some core components in the chart.

Top Horizontal Axis

The information represented on the X-axis varies depending on the data used.

You can use either of the attributed metrics (e.g., clicks, cost, wasted spend, etc.) from your Google Ads account.

Bottom Horizontal Axis

The horizontal bar at the bottom of the chart denotes the cumulative line’s percentage values.

Cumulative Line

The cumulative line runs diagonally downwards through the chart to add each bar’s percentage values, starting with the top bar. It enables you to see the values that contribute the most results.

Excel is the Best Tool to Conduct Pareto Analysis for your PPC Ad Agency, Right?

Wrong! Find Out Why?

To conduct a Pareto analysis, Excel requires you to organize your campaign data in descending order.

Who has time to remember this crucial step?

Secondly, you have to convert your data into a cumulative percentage.

I am dead-sure you’re already lost!

Then, right-click and select the bar-chart you want to use to visualize your Google Ad campaign data.

Remember, sometimes the Excel app crashes when fed massive amounts of data.

The results displayed by your Excel charts cannot be interpreted at a glance. You need to take your time and check the 20% drivers of the 80% success.

Why undergo all that pain?

If scaling your PPC services is your long-term strategic plan, why would you use a simple Excel tool to conduct the incredibly powerful 80/20 analysis?

The last thing you want is a tool that’s incapable of handling massive amounts of campaign data, agreed?

Stick with me for seconds longer to learn about an that guarantees to solve the problems that come with Excel’s inbuilt charts.

Tool that can Help you Conduct a Pareto Analysis and Generate Easy-to-Interpret Visual Charts

ChartExpo is an affordable and easy-to-use Excel add-in you can use to conduct the 80/20 analysis to uncover attributes preventing your PPC business from creating generous returns on ad spend (ROAS) for clients.

Stick with me for just a while longer to learn the simple and easy steps to use this impressive data visualization tool.

To get started with ChartExpo for Excel add-In, follow the simple and easy steps below.

• Open your Excel application (Excel 2013 with sp1) or later).
• Open the worksheet and click on the Insert menu.
• Click My Apps and then click on See All, as shown.

• Search for a ChartExpo add-in in my Apps Store.
• Click on the Insert.

• The add-in will be added to the Excel application, as shown.

• Log in with your Microsoft account or create a new account.
• Enter your newly created account and start using the ChartExpo add-in. You’re only required to log in for the first time. Next time, ChartExpo won’t ask for your details.

• Open your ChartExpo. By default you will see list view of charts.

• You can access 6 different categories of charts by clicking on Category.

So after installation you can easily conduct a Pareto Analysis by using ChartExpo Add-in.

How Do you Conduct an 80/20 Analysis on Keyword Groups using ChartExpo for Excel Add-In?

Imagine you have a behemoth of a keyword list with tons of attributes (i.e., monthly volume, clicks, CPCs, bounce rates, keyword revenue, etc.).

By applying this principle to your keyword list, you can cut away the riff-raff to find the 20% of keywords that will deliver the most ROI for clients.

Let’s use the tabular data below for our scenario:

Keyword Groups	2021 Sales Revenue	Local Monthly	Approximate CPC	2021 Clicks	Bounce Rate
socks	$2,145	33100	$1.07	1032	67
running socks	$8,737	3600	$1.23	3396	28
marathon socks	$7,261	73	$1.69	3158	21
best socks for running	$812	320	$1.66	236	49
compression running socks	$4,675	590	$1.59	987	26
best compression socks	$7,969	590	$2.32	1143	32
compression socks for running	$224	390	$2.23	294	47
best compression running	$104	16	$1.60	277	88
best running socks	$114	880	$1.69	471	60
sweat wicking socks	$494	46	$0.90	192	25
best moisture wicking socks	$46	46	$0.99	700	45
moisture wicking running	$83	12	$1.31	122	13
moisture wicking socks	$24	480	$0.90	1480	59
moisture wick socks	$311	16	$0.82	96	56

Now put the data in Excel as follow:

The screenshot above is a depiction of an actual Google Ad campaign on Excel. The local monthly column shows the estimated volume of each keyword group.

The other columns are Cost per Click (CPC), Bounce Rate, and Sales Revenue.

Let’s run our ChartExpo for Excel add-in to get detailed insights of the data, as shown on the screenshot above.

Remember, the objective is to identify the best and worst performers among the key groups on the screenshot above.

Pareto Bar Chart using ChartExpo Add-in:

Select your relevant chart that is Pareto Bar Chart from the category of Pay-per-Click (PPC) Charts.

When you click on Pareto Bar Chart after that make sure you select all the columns on which data need to be drawn and click on “Create Chart From Selection” Button. In our case we are selecting first two column from the sheet.

Once it is clicked, you will see Pareto Analysis with respect to sheet data as follow:

If you want to do any change in chart, you can click on “Edit Chart button”. You can click on legend to see the properties to be change.

You can also add the prefix in the data through the properties as highlighted below.

Once you are done with properties changes, you can click on Save Changes button as follow:

The Final Image of your Pareto Chart as shown below:

Why ChartExpo for Excel Add-in?

• It’s affordable and incredibly easy to use. You don’t need data science or IT skills to operate it.
• It has an export option to facilitate the seamless transfer of your Pareto chart in PNG, JPEG, and other formats.
• It comes armed with the magical GREY line that tells you everything with just a glance. Essentially, everything above the GREY line is what you should put complete focus on because it constitutes the 20% drivers of the 80% of the outcomes.

What’s the Result?

From the screenshot above, it’s clear that the keyword groups that you should divert your resources maximally are:

1. Running socks
2. Marathon socks
3. Compression running socks

Basically, it’s the keyword groups mentioned above that matter the most in this campaign.

Why?

Running socks, Marathon socks, and Compression running socks contribute 80% of the total sales revenue ($28,000).

The critical insight is that there’s a big problem with the majority (80% to be precise) of the campaign’s keyword groups.

More ad spend resources should be diverted to the three keyword groups to drive more sales revenue in the long run.

Let’s explore the exciting relationship between the keyword groups and bounce rates with ChartExpo for Excel.

The data set to be used will not change.

Pay attention to how we will switch the relevant metric from sales revenue to bounce rate, as shown on the screenshot below.

What’s the Result?

Remember, to generate a Pareto chart; you have to press the button “Create Chart from Selection as shown on the screenshot above.”

Like we said earlier, Keyword groups below the GREY line are the ‘blessed’ 20% resulting in 80% of the sales revenue despite the astounding bounce rates.

The ‘cursed’ keyword groups resulting in 80% of the total bounce rates are above ChartExpo’s GREY line.

Wrap Up

It’s crystal clear that the 80/20 rule is incredibly powerful in uncovering your Google Ad campaign’s best and worst-performing metrics using data.

Some of the moneymaking benefits of Pareto analysis to PPC ad agencies include the following:

1. The methodology can help you to uncover your best and worst customers quickly.
2. You can use Pareto analysis as your cheat sheet to minimize your costs tremendously.
3. The 80/20 rule can help you curate ad content optimized for user-intent with profitable k

The effectiveness of the Pareto principle is slightly diminished by Excel due to various shortcomings, such as a lack of a ‘single-click’ capability to visualize data creatively.

Essentially, you have to be well-versed with Excel to visualize your campaign data using the Pareto rule.

What’s the solution?

ChartExpo is tailor-made for PPC managers because it’s loaded with innumerable custom visual charts related to paid search marketing.

ChartExpo is the tool you need to drive your customers’ ROI through the roof in 2021.

Why?

• It’s affordable and incredibly easy-to-use. You don’t need data science or IT skills to operate it.
• It has an export option to facilitate seamless and EASY transfer of your Pareto chart as PNG, JPEG, and other formats.
• It comes armed with a magical GREY line that tells you everything with just a glance.

Make your customers happy by increasing their ROI within the next 30 days……or your money back.

Conduct a ‘health check-up’ on your pay-per-click (PPC) campaigns FREE of charge.