It’s too presumptive to assume that the medium you use for networking, is the same as all of your prospects. If you are trying to generate sales leads via online networking, you should expand your presence on niche networking sites.
This is becoming increasingly important as many experts agree that focused (or niche) networking sites provide a more relevant networking environment.
Jeremiah Owyang, a social-networking analyst at Forrester Research describes this concept in The Washington Post:
“Companies are learning that these smaller communities may reach people that are more valuable to their brands. It will someday feel more like information than marketing.”
As the internet has become boundless, the challenge has shifted from “locating the information you need” to “filtering out the information you don’t need.” Feed readers, search filtering, niche networking sites and news aggregation are just a few tools that help you limit the information you receive. Without these tools, the information still exists on the internet however, it only becomes relevant once the extraneous content is removed. Apply this to your online business referral network.
It’s All About Context
The best way to evaluate an internet strategy is to compare it to its “real-world” counterpart.
The reason why we drop our children off at daycare, work in an office, and perhaps even meet with a special client in a conference room is because we create context by choosing the appropriate environment. Theoretically, all of these activities could take place under the same roof. After all, it would be rather convenient to go to an “imaginary place” where we could eat breakfast with our family, go to work, and play cards with our friends.
As appealing as this sounds, “convenience” must come second to “context”. Specific environments create value because they define your role within that space. For example, an accountant on a racquetball court is a racquetball player; a racquetball playing accountant on Twitter is neither.
In fact, there are little if any physical spaces which do not have a specific context. Picture a printing service which provides printing solutions for small businesses. Handing out business cards at a Microsoft Exposé is not the best use of the owner’s time. Yes, there may be small business owners amongst the crowd but it would make much more sense if our printer marketed in a more specific environment.
The Big Three Networking Sites
A faux pas many small business owners (and their social media consultants) make, is to limit themselves to the big three networking sites; Facebook, Twitter, LinikedIn. This is not a focused referral system.
If the “environment” defines the “context” of our activities, then referral marketing at a “one-stop-shop” business/social networking site, is the equivalent of going to Central Park and striking up a conversation with anyone in a suit.
The number of internet users with multiple profiles is likely to grow as we start to think beyond the immediate advantage of communicating online and begin to effectively communicate online.
SOCIAL NETWORKING Question: How many total profiles do you have online, counting all (social networking) web sites? Source: Pew Internet & American Life Project Date: Jan. 14, 2009 Results:
one 43%
two 25%
three 12%
four or more 13%
don't know 4%
Field Date - Apr 8-May 11, 2008
Universe: Country: United States Method: telephone Sample Size: 2251 Notes: based on 328 Internet users who have a profile on a social networking site
Contact Information: Pew Internet & American Life Project
Washington, DC 20036
B2b sales leads are the bread and butter of many small business owners. Just because you aren’t selling to other businesses doesn’t mean that you can’t leverage the power that comes from networking with other professionals.
When we think of selling goods or services, we often think in terms of the intended market. Does the service or product provide a solution to other businesses or to people on the consumer level? Small business lead generation can easily blur this distinction.
Often, small business owners have both consumer and professional needs and because small businesses are… well… small, these needs are codependent.
A clear example would be a dentist who uses the same accountant for both their practice and their personal needs.
Still, there are other reasons why connecting with other small business owners is crucial.
Quality service providers tend to have a keen eye for other service providers who share the same values. Because of the intimate nature of small business commerce, professionals have a good idea of what their clients expect when it comes to outstanding service. They’ll be more likely to send a referral or even recommend a professional who sets the same standards for quality.
Their sixth sense will let them know if you are someone they can send a referral to.
Even if you don’t sell directly to other businesses, it’s important you establish rapport with them to develop quality b2b leads.
Networking with quality professionals is always important. In this unprecedented housing market the quality of a mortgage broker lead has never been more crucial. Whether you’re looking for a mortgage broker or referring one to a client, trust is incredibly important. Many would say that the recent activities of some lenders would bring into question the trust of many clients and associates alike.
“For the last couple of years, low interest rates, aggressive marketing tactics, scant industry oversight and investors who want to put their money into real estate instead of the stock market have contributed to the ideal operating environment for predatory lenders.”
-Jay MacDonald, MSN Money
Choosing a mortgage broker based on a classified ad or a recommendation from someone you don’t know is foolish. At the very least, find a mortgage broker in a qualified business directory and prepare a list of questions you’d like ask.
Optimally, you want to get referred to a mortgage broker by someone who you know and trust. This could be friends, family or another professional, perhaps a real estate agent. It is important to maintain accountability so that you, the mortgage broker, and the person who referred you are all fully vested in the quality of the service and the referral. This is a “satisfaction guaranteed” referral system.
In many cases, it’s all too easy for a trusting homeowner anxious to leverage a home’s value or lock up a low rate to fall prey to less-than-upfront lenders. Whether you’re a first-time buyer or looking to refinance your home, you need to find the right person.
Due to the popularity of our last post, “Snow White and the Seven Referral Networkers” we proudly present Fable Fridays. This weekly installment will draw parallels between referral networking and some of society’s most cherished moral tales: Aesop’s Fables.
You could go to expensive seminars and buy up every book on referral marketing, but it doesn’t take a marketing genius to realize that Aesop got it right nearly 3,000 years ago.
The Hart was once drinking from a pool and admiring the noble figure he made there. “Ah,” said he, “where can you see such noble horns as these, with such antlers! I wish I had legs more worthy to bear such a noble crown; it is a pity they are so slim and slight.” At that moment a Hunter approached and sent an arrow whistling after him. Away bounded the Hart, and soon, by the aid of his nimble legs, was nearly out of sight of the Hunter; but not noticing where he was going, he passed under some trees with branches growing low down in which his antlers were caught, so that the Hunter had time to come up. “Alas! alas!” cried the Hart:
“We often despise what is most useful to us.”
The Web Designer and the Massive Network
The web designer was browsing her LinkedIn profile and admiring the hundreds of online connections she had amassed. “Where can you see such a large network as this, with so many connections! I wish my ‘real-world’ referral partners would grow large online networks too; my attorney barely has 50 online connections.” Within a month the economy turned for the worse and her sales had dried up. Yet, because of the designer’s intimate networking relationship with her attorney, she was able to keep her head above water. One day she received a lead from a stranger on LinkedIn and she followed up. Unfortunately the lead was useless and the prospect said, “I don’t know who told you to contact us. We don’t need a website, we’ve got a LinkedIn profile with hundreds of connections.” “Alas! alas!” cried the designer.
“Stay true to your reputation, expertise, and close colleagues; everything else is ornamental.”
You can find hundreds of blogs citing examples of good networking practices, but at the risk of sounding negative, most avoid the topic of bad networkers. We thought a “G” rated movie would be the perfect vehicle to sneek past the status quo and engage a topic we all deal with now and then; bad networkers.
Below are some bad networkers you already know.
Bashful
Yeah, we all thought bashful was cute in the movie but in this article he’s a real drain on your referral marketing strategy. Bashful is not an active networker. Sure he’s a nice enough guy, if you get him alone for lunch, but the last time he sent you a referral Snow White and the Seven Dwarfs was in theaters. Bashful might make a better friend than a referral partner. Even if they are nice, there’s no room for freeloaders in your referral network.
Doc
Doc’s smart. He knows all the buzz words, he’s bought all the e-books, he has a Facebook friend list that rivals the population of China and every referral author on speed dial. He’s already Tweeted about this blog and we haven’t even finished it. Yeah, he sent you a referral just yesterday… unfortunately 50,000 of his Twitter followers got the same referral too. You don’t get points for being intoreferral marketing, you get points for doingreferral marketing. Tell Doc to go write a referral marketing book and find someone else who’s ready to play ball.
Dopey
Dopey is the opposite of Doc, he just doesn’t get it. You’ve tried to explain it 600 ways but he just doesn’t get how referral networking works. He blew $5000 last month trying to generate sales leads through a pyramid scheme. He doesn’t accept your invitations to exchange referrals, hasn’t followed up with any of the leads you’ve sent him, and probably wouldn’t think to mention you if there was a prospect standing in front of him with a megaphone, begging for the services you provide. While this guy is still looking for the “on switch” to his referral system; ditch him!
Grumpy
Grumpy claims to have a boat-load of referrals but he’s just not going to send any until he gets one from you. He’s still playing a chess game from 1983; he refuses to go first. Referral marketing isn’t poker and you don’t need to call his bluff; it’s time to call someone else.
Happy
Happy couldn’t be more different than grumpy. He views referral marketing as a holy path to nirvana. He gives self-help seminars on “referral marketing and your inner child”. He thinks that tracking referrals is wrong because he teaches that anyone who expects their professional relationships to be balanced must be evil. You’re not making sandwiches, so lose the fluff. There are more worthy charitable causes than deadbeat referral partners. It’s time to let the rubber meet the road. Let this guy “conceptualize” revenue as he gets smaller in your rear view mirror.
Sleepy
Sleepy’s referral was timely… last month. You once sent him a client in need of pediatrics but unfortunately by the time Sleepy followed up, the client needed geriatrics. Besides, Sleepy gets Grumpy if you interrupt his siesta. It’s time to kick Sleepy off the couch and tell him to go home.
Sneezy
Sneezy is a good sport but his reputation is a little under the weather. He can put his business card in your pocket from forty feet away but what you’ll really need is a tissue to soak up your client’s tears after they experience the quality of his work. Don’t worry about Sneezy, he just doesn’t see the value in repeat business. It’s time to quarantine this referral relationship.
Do you think Walt could have foreseen the terrible networkers he had created?
Mirror mirror on the wall. Who’s the most referrable of them all?
We often think of an optimal referral relationship as an arrangement where you and another professional both benefit by exchanging an equitable number of qualified sales leads.
A big misconception among inexperienced referral networkers is thinking that clients are passed back and forth between businesses. Potential clients are not poker chips and the idea isn’t that you need to draw them into using your colleague’s services. In fact, most people don’t need to be sold on being referred at all; they prefer it!
“The advantage to working off a referral is that your realtor will receive a referral fee from the new realtor. This reinforces the notion that they will have a vested interest in finding you someone you can work with. They will also keep in touch with you to ensure you are satisfied with the referral instead of you having to deal with problems on your own.”
We often associate referral marketing with sales leads and generating new business. While referral marketing is the best way to boost your sales, you’d be wise to think of how the same relationship based approach can be applied to the hiring process. Assuming you don’t have a dedicated HR department, small business owners often rely on a passing gut instinct; with varying results.
Here is just one example of how you can take a referral approach to finding good talent. Let’s say your law firm has recently taken on a number of new cases, because of the increase in volume of work, you need to find reliable clerical support. This is a good example of when it is beneficial to have similar businesses, which you may even view as competitors, in your business referral network. For a variety of reasons, the law office that your referral partner owns can probably refer you to the right people or at least, generate some word of mouth that you have an opening.
“It is necessary to add some structure to an employee-referral program, communicate the benefits to employees, track the success of referred candidates, reward successful referrals and discourage low-quality referrals.”
If you’ve ever hired someone then you know that it’s a huge waste of time to take on a person who either can’t get the job done or is not fully committed to the task. You can find an endless number of prospects in the classifieds, Craigslist, or job posting sites. In this economy, you’re likely to be overwhelmed with responses. To ensure that you will end with that one-in-a-million candidate, don’t play a numbers game, use qualified referrals from people you know and trust.
Unfortunately, Webster’s Dictionary hasn’t caught up to the small business world quite yet, but it sure would be nice to have a working definition of a ‘qualified prospect’. In a world saturated with Craigslist postings, friend requests, and e-mail lists: it is important to be able to distinguish between a qualified sales lead and an unqualified sales lead.
One of the easiest ways to differentiate from the two is to pose this simple question: Do I have a clear advantage over any other professional who may be trying to court a particular prospect? You can apply this formula in nearly every referral marketing situation. For example, Tracey, a web designer who is looking for new business pays to post dozens of ads on Craigslist. Jim, a restaurant owner is browsing Craigslist and is possibly interested in creating a relationship with a web designer to help create and maintain his restaurant’s website. Now let’s pose the question: Does Tracey have a distinct advantage over any of her competitors when it comes to Jim’s decision? …The answer is absolutely not!
Tracey’s firm is competing with thousands of other firms, both locally and nationally, who can just as easily post a picture on Craigslist. Jim may do a bit of browsing, but he is likely to become overwhelmed with the hundreds of seemingly identical options. Pursuing unqualified sales prospects forces you to cast your net extremely wide and expend a tremendous amount of effort in the hopes that you’ll entice a stranger to give you a call. To be blunt, when was the last time you hired a service professional based on a Craigslist ad, cold call, or a classified?
Suppose Tracey has a good relationship with her accountant named David. She knows that David works with quite a number of local businesses including restaurants. Tracey calls to touch base with David and also takes the opportunity to remind David that he may have a few clients that could use her design services. Later that afternoon, David is on the phone with one of his clients, Jim who happens to be opening a new restaurant. Through some tactful networking, David discovers that Jim will need to establish a website in the near future. Of course, David will want to send Jim’s contact information to Tracey immediately using Referral Key.
Does Tracey have a distinct advantage over her competitors? …The answer is absolutely yes! There’s accountability all around. Jim trusts David’s advice and David is familiar with the quality of Tracey’s work. Jim is focused on running a successful restaurant. He doesn’t have the time to follow up with dozens of Craigslist responses and he certainly doesn’t have time to play phone-tag with an unqualified web designer. Or worse a web designer based out of his basement in Aruba who hasn’t returned his phone calls in a month since Jim’s last payment.
The bottom line is if Tracey immediately follows up with Jim, she is almost guaranteed to close the sale. Jim is an example of an extremely qualified prospect. This polarizes the clear difference between the effectiveness of a strong business referral network and blanketing Craigslist with your pitch.
We came across a great article in the Mass High Tech Journal by Richard Banfield
about the relative value of size versus quality of one’s personal or business network. Banfield makes three interesting points we feel are worth sharing when thinking about referral networking.
1) For younger users, or, the “Millennial Generation” or Generation X as they are known by advertisers and branders, the size of one’s network is more important than the strength of the relationships in that network.
This is interesting and not altogether surprising when you consider the mindset of a 21 year-old student hipster versus a 45 year-old small business professional. “If we only knew then what we know now…” comes to mind. When I was 21 I was certainly worried by the fact that I didn’t have a “ton” of friends; I was never part of a large clique. And this was well before social networks (or email for that matter) even existed.
By the time I hit my thirties I realized that the six or seven quality people I chose to spend time with were all I needed. And now in my forties, well, I’m lucky to see more than a couple of them regularly. With my growing business network it was the same. As a young PR professional at a small agency in New York, I was focused on amassing the biggest Rolodex of press contacts in the office. Now, of course, I know that long standing relationships based on mutual respect and trust with the right ten journalists in the right industries are far more valuable. And when those journalists move to a bigger outlet or another medium – they take our relationship with them, introducing me to a whole new set of peers.
Banfield seems to agree. He argues that 2) “For businesspeople, we find the size of our networks being less important than the degree of trust between each connection….” He also points out something very interesting, that social and business networks, whether LinkedIn or Facebook, have not quite figured out how to measure the trust level between members; they have no way of qualifying or quantifying it to their audiences. So what’s the real value of hundreds of “contacts?” If vague prestige among strangers is your goal, maybe a lot. But for the average small business professional looking to turn business referral exchange into revenue, the answer remains, “Not much.”
This speaks to the notion that as the social and business networking industry matures, the natural evolution will be toward niche, or smaller, networks with a specific focus. We’ve seen the development of niche networking groups already – from lawyers and real estate agents to knitting enthusiasts. For those networks in which there is a specific, measurable business proposition (i.e. quality referrals or proven growth in business networking relationships) this trend will only sharpen. It’s the long tail theory at work again. We believe that the niche business networks who service several complimentary vertical industries (like Referral Key) are best positioned for the future.
Banfield’s final point is that 3) “The size of your network conveys popularity while trust establishes your longevity as a member of the network. Think of the size of your network being your marketing department while the strength of your connections is your customer service department… the strength of your connections suggests integrity.”
We couldn’t agree more. How does one measure the strength of one’s connections? This is where the mystery of humanity and precision of technology meet. Only you know how you rate those in your business network (and your personal network, for that matter) as far as trust ability, integrity, professionalism and reliability. Only you know the quality of the referrals driven by those in your business network.
No program or application or widget will ever assess a human relationship with the expertise your personal experience does. What the right technology tools can do for you is manage, track and store the information and experiences, providing reporting, tracking and reminder tools so your brain doesn’t have to. The right tools can make your professional relationships work harder for you, and grow your business as a result.
We would add that not only is the strength of your connections your “customer service department,” it is the very skeletal framework that houses your business. The controversial comedienne Sandra Berhnardt once had a one woman show titled, “Without You, I’m Nothing.” She knew the deal.
This is what a strong business referral network is all about. And the beautiful thing is that it works both ways – whether you’re twenty-one or sixty-one.
Turkey Day is here and with it, the end-of-the-year crunch. The old adage that “nothing happens and no decisions will be made until first quarter” may be true, but that doesn’t mean your business networking should stop or that the referral well should be allowed to run dry; quite the opposite, in fact.
From the standard Holiday card to lavish gift baskets and memorable office parties, charity work and business New Year’s resolutions, there’s never a better opportunity than the holidays to increase your visibility and market your services to your existing business network to generate referrals. Holiday reminders of the above kind are a great way to generate new referrals in an otherwise slow time of year, and the holiday season is the ultimate excuse to send festive, friendly “nudges” to your circle of trust.
But all too often, we send standard holiday cards to thank customers, colleagues and
associates for their business, thinking this will strengthen professional relationships. Many of these greetings get lost in the shuffle and possibly tossed in the waste basket because they are impersonal, predictable and insincere. Admit it; you’ve tossed a few into the circular file yourself. So here’s an idea for the referral network that never sleeps: What better way to demonstrate to your professional network that you really value them than by rewarding them for the good services they provide with a hand picked referral from your client list?
Whether you use Referral Key to do this or not, it’s a smart move and relatively easy to pull off. Start by asking your clients now what their needs are likely to be in 2008. Let them know the extent of your professional business network and how it may benefit their future needs. Include their information in a holiday greeting to a trusted associate and you’ve killed several birds with one stone: Your holiday card will surely be remembered, and your relationship as well as the potential for reciprocity is strengthened with that contact. In addition, your client is well served and likely grateful for the resource.
There’s really no better time than the New Year to get off on the right foot with professionals you know and trust to help each other grow your businesses.
Facebook ads are here whether you like it or not. On Nov. 6, 2007 CEO Mark Zuckerberg unveiled the new plan entitled Beacon. “Facebook Ads represent a completely new way of advertising online,” Zuckerberg said (Facebook). It is clear that Facebook is going to turn some heads with this revenue model but what is unclear is how successful it will be – either for advertisers, Facebook, or most importantly, users.
Facebook has always founded its success and differentiated itself from its big brother, MySpace, by maintaining a clean ad-free interface. Facebook has been garnering a notably more mature member base, and presumably with that, more business professionals interested in building an online business referral network – this may be due in part to their lack of ads and clutter. But perhaps business professionals looking to use large social networks like Facebook for business connections will think twice before inadvertently sending a potential customer lead a subtle product endorsement that has nothing to do with their business. According to mashable.com, “Now both MySpace and Facebook are offering ad networks, and frankly, the implementation of MySpace’s may be more effective (Mashable Article).
Now that Facebook is switching gears they can expect advertising revenues but at what price? The ad system is going to work a lot like its already popular wall postings. Currently users write comments on their friend’s walls (profiles) to communicate. With the new ad system, if one of your friends comments about a brand or product, a picture of that friend endorsing the product may show up on your page. Even more notable is that the system will track your visits to third party websites using cookies. Don’t be surprised if your picture ends up next to a Pepsi bottle on all of your friend’s Facebook pages. Of course there are undoubtedly going to be privacy issues. Will we see a drop in average user age as a result? Will LinkedIn remain as the only mature social networking site? Once again we see a reason for niche networks as the answer to building an effective online referral marketing system using existing personal connections.
Privacy advocates and attorneys alike are already in a lather about the controversial new plan. John Gartner explains, “Facebook’s new SocialAds may be illegal according to a New York attorney. The law prohibits use of someone’s image with written consent, which could derail SocialAds” (Marketing Shift). Not exactly the best system for business networking professionals to adopt.
Privacy issues aside, this could be an effective and personal way for companies to make connections with consumers. But how will this affect Facebook’s end user experience? One view is that Facebook is already somewhat cluttered without Beacon and that the full circle marketing is downright absurd. According to Nick Carr of Techcrunch, “It’s a nifty system: First you get your users to entrust their personal data to you, and then you not only sell that data to advertisers but you get the users to be the vector for the ads. And what do the users get in return? An animated Sprite Sips character to interact with” (TechCrunch).
Facebook has done quite well, so I believe they may have a trick or two to make this work. But as it stands I see a serious brand conflict and more importantly there is minimal benefit to their users. Carr points out rightly that “Beacon is essentially a biased market mechanism. That is, advertisers have control - but connected consumers (despite Facebook’s hype) don’t” (TechCrunch). With a plethora of alternatives its hard to believe users – especially business professionals looking to grow their business referral network, will put up with too much clutter before they jump ship for a more relevant niche site.
Select a Cash Bounty Amount
Consider setting up a Cash Bounty that you'd be willing to pay to people who send you new business. It's free to setup and you control whether to issue the cash.
