Pareto Principle As Applied to Envato Markets


#1

Hello everyone, recently I’ve discovered the Pareto principle, otherwise known as the 80/20 rule and have been applying it to lots of things in life. If you’re not familiar, it basically states that 80 percent of effects come from 20 percent of causes. In the Envato market, this would mean that about 80 percent of your sales should come from 20 percent of your items. Calculating this out for myself, I’ve discovered this more-or-less holds true for me (± a few percentage points) so does it for you? I’d also assume that 80% of sales are made by the top 20% of authors, but obviously I have no data to back that up.

I think this can go a ways towards explaining why many of us have portfolios with lots of items with little to no sales and a few items that have quite a few sales. Superficially, we probably tend to think in terms of, “well, this item is better than this one, or it is more suited to the needs of the market,” and although this is likely true, perhaps natural distribution models also factor somewhat into the equation?

I only really have experience selling on AudioJungle, which definitely seems to be distributed this way, perhaps due to the fact that it’s large market, so I’d be interested to hear what other people’s experiences are. Personally, I think if you can accept that something like this principle might be underpinning a lot of things in life, it can help you understand why things sometimes don’t go exactly according to plan and why everyone item can’t be a best seller.


#2

So basically 80% of mumbo comes from 20% of jumbo…


#3

https://en.wikipedia.org/wiki/Pareto_principle

https://en.wikipedia.org/wiki/Power_law