Tails You Win: Why the Few Winners in Marketing Are Worth the Many Losers
Do you ever feel like your marketing efforts are a shot in the dark with way more misses than hits? What if I told you that's exactly how it's supposed to work and why those few big wins make all the difference. In today's episode, I'm going to dive into this concept of Tails You Win and unpack why the process of working through marketing failures is the only way to uncover marketing gold.
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Tails You Win: Why the Few Winners in Marketing Are Worth the Many Losers
Do you ever feel like your marketing efforts are a shot in the dark with way more misses than hits? What if I told you that's exactly how it's supposed to work and why those few big wins make all the difference. In today's episode, I'm going to dive into this concept of Tails You Win and unpack why the process of working through marketing failures is the only way to uncover marketing gold.
Hi, I am Tim Fitzpatrick with Rialto Marketing, where we believe marketing shouldn't be difficult. Thank you so much for taking the time to tune in today.
What Tails You Win Means
So this episode came to fruition because of a book that I recently read. I recently read a book called The Psychology of Money by Morgan Housel. If you're into that stuff, I would highly recommend it. It's a great book. But in the book, he talks about this concept of tales you win. And what tales you win means is that a small number of events or actions can account, and often do account, for the majority of your outcomes or your results. And this really stuck with me because this same principle is absolutely relevant, and we see it time and time again in marketing, not just with money and investing. So I wanted to talk about it. One of the things that he touches on in the book is he gives an example of Warren Buffet. And Warren Buffet has made a lot of great decisions, but there were a few exceptional decisions that outweigh the rest. He has had some key winners over his investing career that have really defined it and made a disproportionate impact on Berkshire Hathaway's performance. Investments It's like Coca-Cola, American Express, Geico, Bank of America. There's four investments. He's made tons of investments over time. Those are just a few of the examples. But he's also made, and he acknowledges that a few major winners have driven a lot of the success, while many smaller or unsuccessful investments have contributed little or nothing to the overall portfolio.
So here's what I want to do. I want to talk about how this concept applies to marketing. So let's dig first into the power of the tail. So again, tails you win, this concept is that a small number of events or actions within your marketing are going to account for the majority of the results. We see this all the time. And that's why I want to talk about why failure is not just an option, but it's a requirement in marketing. So many of us are just afraid of, oh, my gosh, I made this marketing investment and it didn't work and it's over. No, that is failing is part of the process. It's part of the process.
The Reality of Marketing Failures
So let's dig about into the reality of marketing failures. A lot of marketers don't want to talk about this. But most marketing fails, that is the reality of it. Now, there are common reasons for failure, and even if you address some of these common reasons, you're still going to fail. Again, that's part of the process. But some of the most common reasons I see for marketing failure is what Dan Kennedy talks about as market message media mismatch. Okay, you're either targeting the wrong market, the message isn't accurate, or you're not using the right media or the right marketing tactics to get in front of those people. It could be one of the three. It could be a combination of all three. But that's typically why marketing fails, market-message-media mismatch. So if most of our marketing fails, and that's the reality, we've got to adopt this approach with marketing that we're always going to test, measure, and learn. That is a constant cycle. You're wash, rinse, repeat. You're testing, you're measuring the results, you're learning from it, and then you're going back and you're going to start to test, measure, learn all over again. That's what this process is like, right? So the failures are essential to discovering the winners. If you don't test, measure, and learn from it, you're never going to find those winners that are going to make all the failures worth it. There's a quote that I came across when I was preparing to talk about this that said, you can't find the needle in the haystack without rumaging through the hay. So we've got to adopt this feeling that marketing failures are not just okay, but they are a critical part of the process.
The Importance of a Process-driven Approach with Marketing
So let's talk about the importance of a process-driven approach with marketing. So with the process-driven approach, what happens is with processes that it mitigates risk. Again, we're always testing, measuring, and learning. So from that process, we can iterate, make changes, and when we find winners, then we can invest more heavily in those winners. Some of the key things that you're going to want to consider when you take this process-driven approach of we're going to test, we're going to make changes and iterate on that, and when we find winners, we're going to scale those and invest more heavily in those. Some of the tools and strategies to uncover these high performing actions are we can A/B test or what we call split testing. So for example, if I'm going to put out an ad, I might A/B test the headline. I'm not going to change a bunch of different things in the ad because then I don't know what actually worked. When we're testing, we can only test one variable at a time. But we can A/B test and go, Oh, this headline performed better than this other one. Great. We're going to run with this headline, and then we're going to test something else. That might be testing another headline or it might be adjusting copy within the ad. But that's an example of A/B testing. You're testing a single variable and making changes there to see if that has an impact on your results. So A/B testing can help with a process-driven approach to marketing. Analytics, tracking specific metrics that are going to help identify whether things are working or whether they're not so that you can make informed decisions about what needs to do. And then having feedback loops within your business. Feedback from the entire team, feedback from prospects, from clients to gain additional insights and information that you can use to drive your marketing efforts. Really, when we take this process of driven approach with marketing, we're testing, we're measuring, we're learning, and we're on this constant loop, so important to see marketing as an investment. It takes time and it is a lot of work. That is the reality of it.
Why Are The Winners Worth It?
So why are the winners? Why are the winners worth it? Why are they worth it? Well, just talked about it, right? That with tails, you win, you end up with having this outsize, a small percentage of your activities lead to the greatest impact, right? Think about it, the 80/20 rule. 20% of your efforts lead to 80% of the results, Paretto's principle. It is no different in marketing. If you think about Paretto's principle within marketing, 20% of the efforts lead leads to 80 % of the results. So 80 % of the other efforts that you're taking, they're not working. But that 80 % is critical to helping you learn which 20 % is actually going to drive the results. Those big wins offset those multiple failures. And so even though you've got failures, you're still getting a return on investment because you've taken the time to find the winners, and the winners make it all worth it. So it's really critical that when we take this approach to marketing, we've got to overcome that fear of failure. We are going to fail. We need to accept that as part of the process and embrace it. It is part of the process or the journey. It's okay to fail with marketing. I fail all the time. People that are in marketing like me day in, day out fail all the time. You will fail all the time as well. That's just part of the process.
Conclusion
So I really hope you found this helpful. When I read this in the book, it just really resonated with me because it just translates right over to marketing. So again, see those marketing failures as stepping stones. They're not dead ends. So if I can leave you with just one last thought, I would just say, the only way to lose in marketing is to stop trying. The only way to lose in marketing is to stop trying. So keep in mind this concept of tales you win with marketing. It is a critical concept. I hope you have found this helpful. If you've got questions, you can always reach out to us, rialtomarketing.com. Feel free to book a discovery call. I'll be happy to chat with you. The other resource we've also got for you is over at RevenueRoadblockScorecard.com. When we work with clients to help them build their marketing engine, we focus on removing the revenue roadblocks that exist within nine core areas of marketing. And if you want to know which ones are slowing down your growth, that's where you can do it in less than five minutes. Tons of value from that report. So RevenueRoadblockScorecard.com. Thank you so much. Until next time. Take care.