Back in 1906 the Italian economist Vilifredo Pareto made the famous observation that twenty percent of the population owned eighty percent of the property in Italy. This was later generalized by Romanian born Joseph M. Juran into the Pareto principle or the 80/20 rule. In business, the principle is mostly translated as 80% of the sales come from 20% of the clients. And indeed. Looking deeper into the higher income consumers, we discovered a distinct bubble of disproportionate impact for current and future revenues.
This is the top 20% of the broad commercial target by income or the Pareto Population. Each country has a Pareto population, the most valuable consumers with a very disproportionate share of revenue in most consumer categories. They are the driving force for new products or service adoption: in Romania, 73% of Early Adopters of technology are Paretos.
Understanding their world provides important context for targeting, brand portfolio strategy choices, new product or service introductions, brand positioning, pricing strategies and integrated marketing communications.
WHAT’S INSIDE THE REPORT
The report comes from deep experience in developing winning propositions for consumers of above average income. A comprehensive project done in 5 distinct stages enabled us to discover and understand the Pareto Population and compare it with the Broad Commercial Target through many lenses such as:
- Who are they, how are they different from the general population?al population?
- What makes them tick? Which are their motives and fears?
- How much do they earn?
- How do they make their spending choices?
- How do they see an ideal bank, car, drink, etc?
- What’s their approach to career, parenting, free time?
- What are their sources of information and media choices?
- What is their ability to drive trends?
- How did their behavior and attitude change in the troublesome year of 2022?
ADVANCED ANALYSIS FOR DEEPER INSIGHTS
Firstly, the Pareto Population is not homogenous. In fact we have identified 5 subgroups based on their motivations and needs: Appreciation Seekers, Ambitious Achievers, YOLO/FOMO, Easy Goers and Dedicated Caregivers.
Advanced analysis led to detailed portraits of these subgroups, which are are must-have tools for works of targeting, portfolio, brand and product strategies addressing the upper-mid to high purchasing power population.
Secondly, we have segmented the population for attitude to innovation. The “Innovation Adopters” are critical for the market success of new product or service launches, and therefore we have assembled a special chapter of innovation adoption.
THE POWER OF THE SECOND WAVE
In 2022 we have run the second wave of the Pareto Report. We expected many attitudes and behaviors to have changed due to the turbulent period we’re in. The changes are there, though not to the extent we have expected at the start, meaning the Romanian society seems to be quite resilient to uncertain times. Still, the analysis of two consecutive years starts to give a good idea of trends and ad value to planning for the future, especially when we look at innovation adoption of trends and changes in lifestyle.
As such, the Pareto Report provides an exceptional wealth of information of various depth and with potentially different uses. We have organized it in distinct products which could be purchased separately based on your needs.