The fragmentation of media is a phenomenon that will change commerce forever. It would seem that technology finally caught-up with consumer expectations, addressing consumer’s needs on an ever-categorical plane.
Just 10 years ago large corporations and media outlets were the “invisible-hand” that drove commerce, dictating what was popular and unpopular, seen and unseen. Today, they are over-burdened dinosaurs facing extinction. Darwin’s theory never fit so flush within the world of commerce. Restrained by their ever-burgeoning size and ill-adapted for a new environment, big businesses are being outperformed by small businesses with niche adaptions that fit client’s needs like a puzzle. Small Businesses are the mammals of the late cretaceous period, they are more deserving of new business which is why they’ll get it.
Small By Choice - Squirrels Aren’t Stupid
Mammals have incredibly diverse adaptations which allow them to thrive within their niche environment. Squirrels are small and very successful as a species. The squirrels in The Boston Common are smart too. They know they have a distinct advantage by laying claim to such a micro-nook. Sure there are bigger forests with bigger trees but by monopolizing The Common, these squirrels stay fat year round; in the animal world that means they’re loaded. The same holds true in business. A freelance editor that specifically services local Law Offices , will likely dominate that environment too.
You’re a small business owner for a reason. You don’t want to just be a part of something big, you want to be a big part of something.
How Niche is too Niche?
You should always strive to be as niche as you possibly can without compromising your sales goals. If your goal is to take on 50 clients this year, don’t target a market with 3,000 prospects and hope to fight for 50 of them, instead, narrow your niche until there are a much smaller number of potential clients and competitors. Focus your efforts and don’t give-up until your business becomes synonymous with that market. The squirrels in The Common know how to get fed year after year; what’s your problem?
Mammals with Long Tails
The picture above shows the Long Tail theory which explains how popular products/services actually makes up a smaller portion of the market place. If you’re a talented small business owner then The Long Tail is your friend. The Long Tail pretty much says that no matter how specific your expertise, there is someone out there looking for you. Google is a good metric in determining the types of services people are interested in. According to Google themselves, the majorit25% of all searches performed on Google are original.
Get out there, get specific, and generate more targeted sales leads.
We found inspiration for today’s blog in the OED (Oxford English Dictionary). After listening to NPR’s interview with Ammon Shea, who spent the last year reading 22,000 pages of the OED in a Manhattan basement, we realized that referral networking had its own unique lexicon. Because the OED contains words and not phrases, we thought it would be interesting to fuse definitions to create a more standard interpretation of today’s heavily used networking vocabulary.
Referral Business
The referring of an individual to an expert or specialist for advice whom one is united in enterprise with.
Reciprocal Relationship
A state or relationship in which there is mutual action, influence, giving and taking, correspondence, etc., between two parties.
Promotion Campaign
The action of helping forward; the fact or state of being helped forward; furtherance, advancement, encouragement. The publicizing of a product, organization, or venture so as to increase sales or public awareness.
Qualified Sales Lead
A guiding indication which possesses a certain quality; a clue to exchange a commodity for money or other valuable consideration.
Relationship Building
To construct by a process, a condition or character based upon this; kinship.
Trusted Colleague
Confidence in or reliance on some quality or attribute of one, two or more leagued together; a confederate, an ally.
Drive Revenue
To put, bring, cause the return, yield, or profit of any important source of income.
Loyal Clients
Those who are bound by allegiance to and who employs the services of a professional or business man or woman in any branch of business, or for whom the latter acts in a professional capacity.
Is there a way to reduce your carbon footprint by networking online? You aren’t likely to offset global warming through online networking but since Esurance can claim to be “Green” by simply not using paper, we thought we’d get your opinion on Green networking.
There are a couple ways networking online could be considered Green.
First, you won’t need traditional business cards if you network online. According to business card manufacturers Applied Designs, “Statistics show your sales will increase by 2.5% for every 2,000 cards you hand out.” This statistic needs to be taken with a grain of salt given the source. However, we do know that it takes a lot of paper to produce thousands and thousands of business cards that may only result in a couple of referrals.
Second, networking online obviously saves you a commute. Assuming you are driving a vehicle, you’ll likely be driving to networking events and meeting with individuals to boost lead generation . These miles add up. If you drive just 50 miles per week for networking purposes, you’re using approximately 125 gallons of fuel a year. Many professionals easily drive 100+ miles a week to attend networking events, lunches and seminars.
There really is no substitute for face-to-face networking but we wanted to know if you thought networking online could pass as “Green”.
Don’t forget, you’ll need a computer and electricity to network online.
Because there are no guidelines as to what can be labeled Green, we’d like to get your opinion on Green networking.
a major form of Japanese verse, written in 17 syllables divided into 3 lines of 5, 7, and 5 syllables, and employing highly evocative allusions and comparisons.
We’ve always made a point to loosely define the “optimal size business network“. After all, every small business owner has a unique network with different qualities. However, in an age of massive social media networks and micro-stardom, it has become increasingly important to reevaluate the size of our network. To effectively generate sales leads can directly correlate with our ability to manage our referral relationships.
We can certainly identify two extremes. It’s safe to say if you have 3 people in your referral network, you aren’t likely to get a ton of new leads. Conversely, if you have 300 people in your network, each individual relationship may not be mutually beneficial.
Dunbar’s Number*
For those of you who are unfamiliar, “Dunbar’s Number” is a theoretical cognitive limit to the number of people with whom one can maintain stable social relationships. It is widely interpreted that this number is around 150. Dunbar’s Number has been increasingly revisited due to the explosion of social media sites and the vast number of “friends” people are accumulating. The theory even appeared in the bestselling book, “The Tipping Point”.
What does Dunbar’s Theory Reveal About Referral Networking?
While 150 is not an absolute number, the idea is that once your business network exceeds a certain number, it is unlikely that you will be successful in managing those relationships or involved in them at all. Striking a balance is extremely important and there is always a give and take.
In theory, the more connections you have, the more networking opportunities you have. Conversely, the less connections you have the higher the quality per connection.
The Graph Below:
Assuming 2 professionals have an equitable amount of time to spend networking, one with 150 connections and one with 20 connections, in theory the networker with 20 connections will score lower in “networking opportunities” but inversely higher in “quality of networking opportunities”.
The graph demonstrates the intangible, and often overlooked, benefits of a smaller network.
Today’s blog was inspired by SmallBizzBee, a prominent small business blogger, who posed this question earlier today:
“When my customers refer me to others, what three things are they saying about what I do?”
While SmallBizbee focuses on customer word of mouth, we thought it would be helpful to also ask the same question regarding your referral partners. In other words:
“When my referral partners refer me to others, what three things are they saying about what I do?”
There are some things to consider when making the distinction between how accurately your client’s communicate your services and how accurately your referral partners communicate your services.
What are your client’s saying about your services?
Your clients have no intrinsic obligation to learn and accurately communicate the benefits of your services. As SmallBizzBee points out, what you “think” your clients are saying about you may be different than what your clients are “actually” saying about you. It’s always a good idea to follow up with clients and get an idea of how they perceive your services. Yet, because they are your clients and not necessarily a referral partner, you must take a much more passive approach. Probe, ask questions and if you notice any trends or miscommunication; you may want to tweak the marketing message on your end.
What are your referral partners saying about your services?
Conversely, good referral partners need to maintain clear communication and meet the expectations you’ve both set forth. Because you’re vested in each others success, there is a certain level of accountability. It is more acceptable to actively control themarketing message with in your referral. Your strategy could involve anything from a periodic newsletter, to a lunch-date where you specifically tell your referral partner how you’d like to communicate the value of your services.
Referral marketing comes with a responsibility to accuratley represent those who you’ve agreed to generate sales leads with. While the line between b2b relationships and customer relationships can sometimes be blurred, don’t do market research on your referral partners; sit down with them, define clear expectations and be specific in how your services should be presented.
The best music resonates with people who can directly relate to the lyrics. Identifying with your favorite music can be a very powerful feeling. Good music can also be very true to life and surprisingly applicable to referral marketing.
The Beatles have had the secret to generating more sales leads since 1969 and it can be heard on their final album, Abbey Road. The closing line, of the Beatles last song on Abbey Road is, “And in the end the love you take is equal to the love you make”. How true when it comes to getting more referrals for your small business!
Getting more referrals is easy. The key is to be the first one to give a referral. The people who you regularly do business with are more likely to send you a new lead after you have sent them one. If everyone plays by these rules, referrals will be passed around like a hot potato in your business referral network. Lead generation is just that straightforward.
If you’re sitting around wondering why you aren’t getting any new leads it’s probably because you haven’t been giving any. Once you stop being selfish and start spreading the love around, you’ll generate tons of referrals, leading to new business landing right in your lap.
Which artist do you think has the best referral advice?
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.”
Today we sat down with Ken Taylor; author of “Breaking the Sales Barrier” and founder of Ken Taylor & Associates Inc. To call Ken a power networker may be an understatement. His company specializes in sales and leadership training, across multiple industries, he works with fortune 100 companies such as General Motors, Chrysler, and CitiMortgage. He is currently contracted with GM, in charge of training business to business sales, for 600 commercial dealerships.
Ken has been running a successful business for over 21 years.
What do you think of Referral Key as tool for managing referrals?
I actually really liked it, I’m just getting into it now. I like the concept far better than I do Plaxo or Linked In. For most people that join Linked In and Plaxo, it becomes a conglomeration of names. People are trying to link to me and I say to myself, “Who is that and what’s the relationship?” There’s ways to use these services better but 95% have no concept of how to do that and we try to teach them. To be able to track referrals and know “who” gives “what”, is an incredible tool. We found out about you guys through your partner program with Constant Contact and I’m always open to new ideas. I went on Referral Key, explored it and said, “Wow, this is a much better concept than what I’ve seen.” You said you’re a connector and have a 10,000 person network. How do you manage all of those connections? I am connector, and connectors get as much thrill and joy out of giving referrals as getting them. A lot people say, “Gosh, it’s a down economy, how are you doing?”. And I say, “We’re doing great, people trust us and we’ve built that trust over a long period of time.”
What makes a great networker?
The key to networking is asking the questions, “What do you give, before you get?” and “How can you help other people?” I go to networking events and see people running from group to group handing out business cards and not really building relationships. In sales we have a three step process: “Know, Like and Trust”. Someone has to know you. Once they get to know you they have to have an affinity for you. Finally, if you send them a referral, the trust begins to build and you see the floodgates begin to open.
It’s about always having your network hat on. If you’re really an effective networker, everything evolves into a networking opportunity. You might be talking to a client and you happen to know a different client that has particular needs and then bring the second client’s needs up through questions. It’s all about being a matchmaker.
Ask what else is going on and ask more about the company. For example, we’ll go into an automotive dealership, make sales calls with them and encourage them to ask more than just about automotive; “What’s going in your company that’s of concern to you?” Just by asking that question, we’ve now created a referral networking opportunity.
What do you think makes an unsuccessful networker?
I went to a networking event with my wife and I saw some very unsuccessful networking. One young salesperson asked someone what they did and his response to that was, “well I don’t need to talk to you, you’re not in my area of expertise.”
I’ll be giving a seminar and I’ll ask a question such as, “how many of you are in networking groups like BNI?” Of about 50 salespeople, only 3-4 hands go up. Then I’ll ask, “what has you experience been?” By their answers, I know how good they are. One person might say, “I haven’t gotten a lot out of it” and then I know they haven’t put a lot into it. Do you think that tracking referrals is a good idea and leads to healthier business relationships? It’s essential! For example, we work with mortgage loan officers, and we often hear them say, “I established a relationship with a realtor, I gave them 3 referrals but I never got anything back.” Then I ask the loan officer, “Did you create that expectation up front?”. I tell them the problem might be that the realtor is not even thinking about a referral relationship and doesn’t have that same referral mentality.
I encourage the loan officer to follow up with the realtor and say something to the affect of, “I sent you three referrals and I assumed we had a business relationship, did I do something wrong?” The realtor went on to apologize and immediately sent a referral to the loan officer. You have to instruct them and teach them.
We track who sent referrals. We’re going to give them a gift, we’re going to call them and we’re going to make sure that they are rewarded for what they did for us. I got three referrals today and made sure to give three right back. You have to know what people send to you and know what you send out. You have to know who those referrals are, where they came from and what they resulted in. Always keep your referral source informed of what happened, thank them and let them know that you are on the lookout. It’s very important to repay those referrals in kind. It’s my obligation to let you know that I appreciate the referrals that you gave and I want to tell you that I can do the same, it may not happen right away, but please know you’re on my radar screen.
Do you do anything to ensure reciprocal referral relationships? Life is what it is. There are cases where someone doesn’t have the opportunity to send you referrals; maybe there’s not a business fit. But, it doesn’t mean I abandoned that relationship. I keep it on the drawing board and continuing learning more about that person. Even though they may not be a direct referral source, they may become what we term as an “indirect referral source”. They can get me into another network or I find out they’re in different associations and that association ends up being a fit.
Don’t ever dismiss anyone as a client. I’m on airplanes quite a bit. I have the same networking ice-breaker with the person sitting next to me. If they’re not busy reading a book, I’ll ask them, “Hey are you going home or are you leaving?” It’s the beginning of a long conversation that could lead to referral networking opportunity.
1. Make a new friend
Whether it’s the security guard you say hi to in the morning, your morning coffee barista, or a fellow passenger on the train; most of us come in contact with new people everyday. Each one of these people has a unique story to tell and with a few open-ended questions; a 5 minute conversation can turn acquaintances and strangers into friends.
2. Probe
A truly perceptive person can pick up on a stranger’s needs in a matter of minutes. LISTEN, LISTEN,LISTEN. There’s nothing wrong with proactively looking for links of interest and finding solutions to help your new friend. In other words, if your friend at the sandwich shop is looking to purchase health insurance and you can point him in the right direction, it’d be wrong not to.
3. Send the Referral
Refer your new friend to someone who you know will not only do an outstanding job but, reciprocate by sending you qualified sales leads. Even better, send your friend’s contact information directly to your trusted associate so he can act on the referral in a timely manner.
4. Follow Up
Follow up with both parties to ensure the success of your referral. A good referral should have everyone feeling like they got a good deal… and some new friends.
5. Email This Blog to Your Friend
Now it’s time for your referral partner to return volley and if they need a little nudge… send them to this blog!
The holidays are a great time to reaffirm your existing professional relationships. A final interim before the long winter months, a little goodwill in December can go a long way. It’s an ideal time of year to reflect on your current strategy to generate sales leads and refine your approach.
There is plenty of literature on “power selling”, “cold calling”, and “persuasion”. In a struggling economy, the only way these strategies are going to hold a flame to exchanging referrals with professionals you already know and trust, is if you use them as kindling for your Holiday fire. Like most things, the most effective advice is often the simplest. Remember, the Grinch’s heart grew three times when he began thinking of others first. If these conversion rates hold true in the small business world, your sales will grow nine times by sending three referrals.
This season “Tis better to give than receive” which means the slick talking “Mr. Hard-Sell” needs to take a vacation for a while. The right path to successful small business lead generation lies in sending qualified referrals to colleagues who will appreciate it and will reciprocate. You’re a small business professional because you know that to truly be successful, you can’t wait around for others to make the first move. Send a few referrals at the end of this year and you’ll generate sales leads in the New Year.
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.
Generate Highly Targeted Sales Leads
The best music resonates with people who can directly relate to the lyrics. Identifying with your favorite music can be a very powerful feeling. Good music can also be very true to life and surprisingly applicable to 
