Imagine you are a fruit picker in an orchard. The low-hanging fruit is easy to reach, and you can pick it as you walk through the orchard. On the other hand, if you wanted to reach the fruit higher up, you would have to drag a ladder from tree to tree.

The low-hanging fruit principle in business refers to the approach that some executives take to focus on the most easily attainable goals. Typically, these goals lead to the quickest results. This principle can apply to many aspects of a business, including:

  • problem-solving;
  • marketing;
  • sales; and
  • growth.

For example, you might choose to reinvest into an already popular product rather than exploring a new product line.

Below, we discuss some examples that show how your business can leverage the low-hanging fruit principle.

How Can Businesses Use the Low-Hanging Fruit Principle?

Although many factors influence business decisions, you should understand:

  • how opportunity cost functions;
  • the cost-benefit analysis; and
  • the law of diminishing returns.

These terms are briefly explained below.

Opportunity Cost

Opportunity cost refers to the benefit that you could have received but gave up when you chose to take a particular action.

For example, let’s say you had $1,000. After contemplating whether to put the money into marketing or buy new equipment, you choose to put the money into purchasing more equipment. If investing in marketing would have increased your revenue by $10,000, that amount is the opportunity cost that you forfeited.

Hopefully, you based your decision to put the money into equipment purchases on the fact that this course of action would give you a higher return.

The Cost-Benefit Principle

The cost-benefit principle refers to the process of summing up all the direct and indirect benefits and costs of a particular decision. Your cost analysis should include any potential opportunity costs or risks. It may also help to put a dollar figure on any intangible benefits and costs. Using the analysis, you should only proceed with your intended action if the benefits exceed the costs.

The Law of Diminishing Returns

The law of diminishing returns refers to the rule that as we increase a particular input, the amount of output slowly decreases.

In the above example, if you had an infinite sum of money to spend, the question would then be how much capital you should purchase. Applying the cost-benefit principle, you should continue to purchase equipment until the costs outweigh the benefits that it provides.

If you applied the low-hanging fruit principle, you would use the first piece of equipment in its most productive area, the second in the next best productive area and so forth. As you continually increase the amount of capital, the production you receive in return diminishes.

The risk is that it is easy to assume that buying more equipment will lead to more revenue. However, these principles show that you will eventually reach a point where the costs balance with the benefits of adding another unit of capital.

What Are Your Business Triggers?

The low-hanging fruit principle is based on the idea of obtaining results with little difficulty. Usually, you will have done the hard yards to discover a methodology that works which you can replicate when making further decisions. In the context of marketing and sales, the key to success is understanding what triggers work for your business.

For example, when looking for sales leads, you might consider why targeting a particular set of customers works better than others. In this case, a particular aspect of your business might be particularly appealing to this set of customers.

Understanding exactly what these specific triggers are will allow you to place yourself in a strong position to replicate past results.

Understand Your Conversion Funnel

In the context of sales and marketing, the low-hanging fruit principle can play a pivotal role in attracting clients. However, getting customers through the door (or onto your website) is only the first step.

If you can’t convert visitors into paying customers, they mean nothing for your business. At this point, you should aim to:

  • know what your business triggers are; and
  • have a solid understanding of what your sales or marketing funnel looks like in action.

What Are Some Examples of Applying the Low-Hanging Fruit Principle?

As discussed above, the low-hanging fruit principle applies to many aspects of your business. For example, it might include:

  • reusing marketing campaigns that have previously worked for your business;
  • retargeting former customers to increase sales;
  • focusing on existing product lines before expanding your offering;
  • expanding your business into multiple states and territories using the same business model;
  • targeting your social media followers or a subset of your existing customers with a special offer;
  • cross-unit collaboration between teams, as opposed to hiring new people with the same skillset;
  • collecting emails in return for content on your website;
  • making decisions on quickly solvable problems before tackling more complex ones;
  • updating and republishing evergreen content; and
  • recycling content.

What Are the Advantages and Disadvantages of Focusing on the Low-Hanging Fruit Principle?

The low-hanging fruit principle’s primary advantage is promoting efficient gains. Businesses that concentrate on this principle will be able to:

  • hit targets faster;
  • make quick decisions;
  • close more sales;
  • have a steady flow of leads to the business; and
  • achieve more rapid growth at least in the short term.

However, the issue with low-hanging fruit is that there is usually a limited supply. At some point, the fruit-picker will need to bring out their ladder. Likewise, businesses will need to increase their efforts to achieve greater results. The problem with focusing on low-hanging fruits is that it makes achieving these greater results more challenging in the long run.

The low-hanging fruit principle may also create a race to the bottom.

For example, let’s say you ran a marketing campaign on Google Adwords. You also promoted this Google Adwords campaign with a special 10% discount. Not only are you targeting the same low-hanging fruit as your competitors, but you are also reaching customers who may not be particularly loyal to your business.

In many instances, the low-hanging fruit principle may not work with your organisational strategy and goals. Your focus may move away from achieving major milestones to choosing the quick and easy option.

For example, you may have to make a series of decisions at a half-hour meeting. By dealing with the quick and easy decisions first, you reduce the time to address the larger issues. You also may not discuss the more important matters in depth as you choose the easier alternatives to deal with them.

Key Takeaways

Experienced fruit pickers usually do not start with the low-hanging fruits. They start by picking the higher fruits for several reasons. Fruit that is higher up has more exposure to the sun, meaning that in most cases, it is riper and better to eat. Fruit pickers also have gravity on their side when they start from the top of the tree. When their bags get heavier, they can work their way down instead of climbing. Finally, lower-hanging fruits are often damaged by bugs, bruised or unripe.

always have these greater targets in mind. However, the practice of starting from the top and working your way down may not always hold true. It makes sense for cash-strapped businesses or those with limited resources to start with the low-hanging fruits. Low-hanging fruits can provide quick wins, and businesses need wins to create momentum to grow and scale. Ideally, companies need to find a way to benefit from both approaches. You should find a way to simultaneously pick out the low-hanging fruits and climb the rungs of the ladder. If you need help with your business, contact LegalVision’s business lawyers on 1300 544 755 or fill out the form on this page.

About LegalVision: LegalVision is a tech-driven, full-service commercial law firm that uses technology to deliver a faster, better quality and more cost-effective client experience.
Stephen Yoon

Get a Free Quote Now

If you would like to receive a free fixed-fee quote or get in touch with our team, fill out the form below.

  • We will be in touch shortly with a quote. By submitting this form, you agree to receive emails from LegalVision and can unsubscribe at any time. See our full Privacy Policy.
  • This field is for validation purposes and should be left unchanged.

Privacy Policy Snapshot

We collect and store information about you. Let us explain why we do this.

What information do you collect?

We collect a range of data about you, including your contact details, legal issues and data on how you use our website.

How do you collect information?

We collect information over the phone, by email and through our website.

What do you do with this information?

We store and use your information to deliver you better legal services. This mostly involves communicating with you, marketing to you and occasionally sharing your information with our partners.

How do I contact you?

You can always see what data you’ve stored with us.

Questions, comments or complaints? Reach out on 1300 544 755 or email us at info@legalvision.com.au

View Privacy Policy