One of the first things I work with my clients on is the proper use of “Networking”, as well as the best ways to use their time and energy when they are networking. Over the last 15 years, I have watched people spend many hours networking. As a matter of fact I was one of those people. It is exactly how I got the moniker, “Queen of Networking”. One day, my mentor asked me to begin to track all my time. Time that I spent networking, time I spent answering the phone, emails, working on projects, surfing the net, and so on. This was an eye opening experience.   I found that most of the stuff I was doing was not having a positive impact on my business bottom line.

60% of all of my activities in a given week were around networking. Going to the events, following up with every single card that I collected, staying in contact via email and phone calls, screening and fielding emails and phone calls from people who met me while networking, signing up for other events, driving to events, preparing for the events and so forth and so on. You get the picture; I was a very busy lady. Busy does not equal profitable.

Once we had a clear understanding about where my time was going, it was now time to look at how much of that time was actually having a positive impact on my business bottom line. What became painfully clear is while 60% of my time was spent, adding people to my database, and networking, networking, networking, 80% of my income was coming from 10-12 people, 200 where people whom I knew, supported and referred and the other 3000 names and contacts in my database were just that – names and unfulfilled relationships.

The most important feedback that my mentor gave me was simply this statement; “Imagine what your business would look like if you spent 60% of your time nurturing the 10-12 people who are helping to grow your business.” It was a statement that would keep me up at night.

Today you will not find me at every event and when I attend a networking event, I do so very strategically. I have a goal in mind, a purpose to be fulfilled and connections to make for at least one of those 12 people who were helping me to build my business. When I network for others, my own business grows with very little effort on my part. I have the opportunity to see “Givers Gain” in action.   Before you go to your next networking event ask yourself the following questions:

• Where is most of my business coming from?
• Which organizations are producing results for my business?
• Who passes me the most business?
• What are my goals for the event?
• Who do I need to help?
• How can my networking activities help my referral sources?
• What is my networking budget in both time and money?

Welcome Guest Blogger - Tiffany Kellog, she is a friend, fellow Referral Institute Instructor and fellow Blogger.

Have you ever been at a networking event, and you were scoping out nametags, and you saw a name tag that had both a name and an industry. You think to yourself, I know what _______ does… for example, perhaps you see a florist, and you think that you know what a florist does… so why do you need to ask more? Perhaps you see a financial planner at a networking event… do you know what they do? (And are you now, while you are reading this, thinking I know what a financial planner does?)

Often times, by listing your profession on your name tag, you are painting yourself into a box, and it’s not always the one you want to be put in! The disadvantage of listing your industry on your name tag is that you are putting yourself into a category which will allow the people you meet to decide, before speaking to you, exactly what you do and who you are… and if they already have the answers to those questions, why continue on?

Instead of putting your professional category on the name tag, why not put something on your nametag that will have them asking you multiple questions about your business? The advantage is that you get to tell them EXACTLY what you do, and not have them fit you into their preconceived notion of your profession.

So, when you are at your next networking event (or ordering your next set of name tags), what will you be writing to describe what you do?

Having problems with filling in that blank? I recommend the Certified Networker Program, Module 1 & 9, to help come up with your Emotional Based Marketing Message and ideas on what you should put on your name tag.

This article comes from a friend of mine, Frank DeRaffele Jr. As host of the the top Entrepreneurial Radio Show in the country, Frank was asked the following question on his blog.  I felt it was worth sharing with each of you.  Question:  How do you get people who don’t know you very well to feel comfortable with you, trust you a little, feel some confidence in you, before they every meet you?

Answer:  Testimonials.
We seem to all know this but we don’t use this powerful marketing tool enough. When used correctly, this can be one of the most effective marketing tools today both online and offline.

Testimonials are:
1.  Free.
2. Come from various demographics.
3.  Praise the various solutions that you can provide.
4.  Honor your professional ability and your character. Your integrity…..your
personal reputation as a business professional

6 Simple, Easy and Effortless Steps To Get Started:

1. Pick 5 people whom you know and would like testimonials from.

2. Write a testimonial for each of them. Not the same one five times with different names in the testimonial. Write from your heart what you think is wonderful about this person.

3. Send the testimonial to them. Send a note with it.

Do you LOVE what you do?  Would you do it for free if you had too?  I love what I do.  I know that what I do makes a major difference in the lives of others,  I  wake up in the morning excited about my day.  Do you?  This morning as I was speaking to a prospect for the Referrals for Life Program, and I was struck by her belief in herself and that what she does is important and helps others.  I thought to myself, this is exactly the kind of person that I like to work with, one who love what they do and wants to get better at it.  Her commitment to herself and her passion for helping her clients was obvious.

Passion is like the sweet nectar of a flower, it attracts the honey bee, who takes it to the hive to share with their “network”.  When you are passionate about what you do, your network taps into that passion and carries it out into their networks for you.

People want to work with people who believe in themselves, it is easier to put your trust in someone who believes that they are the best at what they do, it is also easier to refer that person to others.

So, let me ask you, do you believe in what you do, are you passionate, does it show?

Trust, I recently reviewed a book on trust, I am not sure how many people read it but I will say in the world of referrals, trust is the most important aspect of the referral relationship.

I read blogs and articles all the time talking about your elevator pitch, your message, your handshake, your networking activities and blah, blah, blah.  While all of this is great information for “Networking” and developing your “Word of Mouth” marketing it is not the thing that will get you the level of referrals that you are looking for.  The reality is when it comes to referring you,  I don’t care how good your message is, if your handshake is the best and you are the best networker in town!

What I do care about is this:  IF I give you a referral, when you are done with that referral will I still look good in the eyes of the person I referred?  My reputation, what people think of me and about me is important to me. The number one reason that people do not pass “Qualified Referrals” is the trust issue.  They do not want to risk their name.

With very little trust I can give out all kinds of leads, because my name is not closely tied to the lead, it will not have a major affect on me if it goes bad so I don’t mind taking the chance.

I had to learn this the hard way,  I referred a person to one of my very good friends, we will call him Joe Smith.  Joe owned a very successful printing company who employed several hundred people.  One day Bill asked for a referral to Joe, I did not know Bill very well but he seemed OK,  so I referred him to Joe.

Bill was late to the first meeting, Bill did not follow up after the meeting in a timely manner, in fact Bill dropped the ball in many ways with Joe.  The very next time I saw Joe was at a cocktail party and of course the conversation came around to business and here is the comment that Joe made to the entire group, “Don’t let Hazel refer you to any of the Yahoos in her network, what a joke.”  Ouch!  Not only was I hurt by Bills poor performance, my entire network was now unable to be referred to Joe who actually was in need of many more services that my network could have provided.

Lessons learned:

1.  Only “refer” those whom your know well and have a high level of trust with.  I do not have to worry about my reputation when I put the referral in the hands of one of my trusted referral partners.

2.  Stay involved with the referral.  Had I bothered to follow up with both parties during and after the referral I would have known what was going on and could have saved my reputation as well as my networks. All to often we pass referrals and never think about them again.

3.  Give feedback to the person you referred, they may or may not be aware of the issue and at the very least they should know why you are not going to refer them again.

Sometimes the best lessons are the hardest lessons.  If you are getting a lot of low level leads from your network, ask yourself what you need to do to increase your trust.  Take time to build trust with people and you will find that the referrals you get are of a much higher quality.

People have to hear things and see things 7 times before they take action, so advertising is important and PR are very important to your business.   but I agree that word of mouth is a powerful way to build your business. It is ALWAYS WORKING, it may not be in your favor, but it is always working. 

Here are a few things to remember about word of mouth.

1. In order for WOM to work well for your company or you as a person, you MUST have a clear, concise message that others can carry easily and repeat to people they know. For instance, I have a friend who reviews property taxes for commercial buildings, if you are over paying then she will file an appeal and get you a refund of the over payments. That message is too long…here is the message that everyone carries for her….. Denise takes the pain out of property taxes, you should call her.  Simple, easy for others to remember.  Most business people have a muddled message.

2. WOM is the most dangerous form of marketing, in that you cannot control people. They may carry the wrong message or a negative message.

3. Word of Mouth is always working, it just may not be working in your favor. Negative WOM travels faster than positive WOM.  Dr. Misner discusses this topic in the book, Truth or Delusion.

I remind BNI members and Referral Institute graduates regularly that WOM is always working. It is important for them to keep the message simple, consistent, and positive. A great message backed up by poor service or a poor image is going to create Negative WOM.

Spending time to identify similarities in your clients will make a major impact on your business.  For instance, if you discover that many of your current clients are low income producing, yet use much of your time and energy you will be able to shift your energy to attracting a different kind of client.

When I owned an insurance agency, I had one client that produced about 30% of my income.  As I began to track how much time I was using to keep this client happy, I realized that I did not really like this client, they were difficult, demanding and taxing. They used more that 80% of my time just to keep them happy. At the same time the rest of my clients were getting less than 15% of my time, they were responsible for 70% of my income, and they regularly sent me referrals.  While the big client, sent me nothing but headaches.  As I shifted my focus, spent more time with the clients I liked working with, and developed better relationships with them, I began to make more money and enjoy my business again.  When my difficult client left for a lower bid, I did not feel the pain.

What I learned from this experience is not everybody is or should be my target market.
I understood the best target market for me were more clients like the ones I had.  Businesses in the blue collar industries, like tool and die shops, and manufacturing companies who themselves had a niche market in the auto industry.  When I understood that, I was able to build relationships with other people who wanted to do business with that target market.

Who are your clients?
Where are you spending your time?
Who are the clients that take little of your time but bring you consistent income?
How much income is each of your clients responsible for?  (track the money)
Are you being referred to the clients you want or are you getting anybody?

The more time you spend identifying your target market, the more successful you will be at training referral partners to find those target market clients for you.

Referrals, leads, word of mouth, buzz marketing, viral marketing, networking, seven second introductions, elevator speeches, referral groups, business networking and social networking.  It all blends, causing confusion, misunderstanding and a muddied mess in the business world. 

You see it everyday, one networking event after another, business cards being passed, people shaking hands, and those ever so famous seven-second introductions being pitched.  It’s the same people at every event, giving out the same cards, same pitch hoping for a different outcome. 

We hear about networking as a way to grow our businesses, and everyone calls themselves networking experts. If you put the words “business networking” into Google, you will get 186,000,000 hits  So called experts teach classes and workshops on how to do better seven second pitches, how to hand out their cards, what to do after the event, how to give more, and do more. 

Recently I ask a young man how he got most of his business, “90% by Referral” he stated.  When I ask what kind of system he had to generate and track that level of referrals his answer was; “I have a great yellow page ad that generates a lot of referrals for us.”  While having a Yellow Page ad will create a lot of visibility for you it is not generating referrals.  

What’s missing here?  What is the plan?  Where is the system?  People who are networking have no idea where their business is coming from, who their referral sources are, what target market they are connecting with, or even if they are networking in the right place.  When asked what their ROI is on all of their networking activities they will say things like, “Great” or “I have made a lot of business contacts and friends while networking”.  Rarely if ever do they really know the ROI.   

If business professionals are going to build their business by referral, there has to be a plan that goes beyond, what most networking gurus are teaching. Word of mouth does not mean business by referral, and Networking does not mean you will get referrals. 

If you really want to build your business by referral, you have to develop a plan, a system.  Much the same way as you developed a Marketing Plan.   

Who are your customers, where do they live, what do they do, are they other businesses or are they consumers? Companies spend thousands of dollars every year identifying their target market, their customers.  How much time have you spent, is your customer anybody who needs or wants your product or services:?  What do you offer to your customers, and why do they come to you?  Have you asked them? Who are your Referral Sources and what system do you have for motivating and training them? 

Networking is very valuable, but learning how to develop a system is more important.  Once the system is in place, and you know whom you want to connect with and whom your referral sources are you will then be able to choose the right places to network.   

If you’re going to build a house you need to take some time and do your preparation, lay out the design, build the foundation, then build the building.  Every step must be followed in the proper order.  The same holds true when you are building your business by referral.  Where is your plan, how is the foundation, or did you forget all of that and just start networking, hoping for best.  

Here are 5 Tips for building a foundation before you start networking. 

1.  Narrow your focus, having a clear Target Market is one of the most important aspects to building a business by referral.  Anybody, everybody, and small business does not constitute a target market.  

2.  Who are your potential referral sources?    If your target market is “Any small business that needs health insurance”, you will find that all you are able to generate will be random unpredictable leads from the people that you network with. 

On the other hand, if your target market is; “Family owned businesses, with 3-50 employees, in the manufacturing industry.” You will have a better chance of building strategic referral partnerships with others working in the same target market.  

3.  Know where you want to spend your time and efforts.  Building a business by referral takes time.  You only have time and money to spend, you can make more money but you cannot make more time, spend it wisely.  When you are networking look for those people who would make great referral partners and begin the relationship process with them.  You do not need 2500 people in your database if you have 10-trained referral partners helping you connect with their clients and contacts. 

4.  Clean up your database.  Are there people in there you don’t even know?  When was the last time you contacted them?  Are clients, contacts, prospects, clearly identified?  Do you have other ways of sorting, like support, information, and referrals?   

5. Create a system for tracking your networking activities.  How many calls did you make? How many notes did you send?  How many hours did you spend out networking?  What events did you participate in?  Who did you give referrals or leads to?  What gets measured gets done, tracking is one of the most important things you can do, but often the most neglected. 

Don’t get caught up in the Networking madness until you have a plan.  Do some work first, build your foundation, identify who you want to network with and where you want to network, then get started. 

Hazel M Walker

Referral Strategist