Business networking has been around for three quarters of a century in an organised manner, Yet although quickly refined into a source of referral quality leads back in the 60’s and 70’s little has really changed in structure and substance since the mid 1980’s – Until now…

From Wikipedia:  In the second half of the twentieth century, the concept of networking was promoted to help business people to build their social capital. In the US, workplace equity advocates encouraged business networking by members of marginalised groups (e.g., women, minority races, etc.) to identify and address the challenges barring them from professional success.

Organised networking, has its benefits and drawbacks.

The Referral Network benefits:

A Place to Belong

Once you’re in – You are part of the tribe, well the tribe you joined anyway. If this is a successful tribe, you have the opportunity to become known, liked and trusted.

Referral Quality Leads

Leads provided within the boundary of such groups are generally high quality. With the relationship of the referrer passed to you, providing you with a low resistance opportunity. Hence a high conversion rate is expected from opportunities provided.

A Structured Approach

Networking groups that provide regular meetings offer a structured approach – Networking for dummies style. You turn up, are shown the ropes and do your thing.

The Referral Network Drawbacks:

Time Commitment

Generally, there is a commitment to attendance AND a commitment to getting to know other members. For each meeting, you’ll need to attend another meeting to get to know another member, AND also a third meeting giving another member the time to get to know you. Where the networking meeting may take a couple of hours, the other meetings take a similar time commitment, plus travel. This can account for a time commitment of 5-6 hours per week/fortnight.

Familarisation Time

Love at first sight can happen, but in a business sense, it rarely does. You know the drill: Know. Like, trust. That takes time. And all that time, you’re investing your time and money in building the said relationships. These will eventuate, at least with some of the members.

Established Relationships

When joining a group, particularly where there is a limit of ‘one per category’, there is a culture of working with other members of the group. In such a case, when joining, there may be well-established relationships with the former member who ‘held your seat’ at the table. In such a case there may be a long lead time for these relationships to break down and create an opportunity for you to fill that role

True Referrals

The basis of regular networking is for referrals. Not just for members to do business with each other, but for members to refer colleagues and associates to each other. However, colleagues and associates often have their own established relationships and the third party referrals are more challenging to create.

Ten Roadblocks to Networked Referrals:

The challenge comes for both, the inexperienced networker and experienced networkers in a new group and the dangers and costs can be significant.

Your referring colleague must:

1. Like you
   a. This is probably a bit obvious and who wouldn’t anyway
2. Trust you
   a. Not just to do a great job but to keep the structure of the relationship with your new associate in law intact (ie, they still want to control their relationship)
3. Trust you’re awesome at what you do
   a. So you won’t make them look like a fool for referring someone who wasn’t up to scratch
4. Have faith that you’ll look after their associate (financially)
   a. So they look truly awesome for the great referral
5. Your referring colleague and their associate must have extreme trust
   a. So the associate is willing to trust their word on your ability and the reasonableness of the price you’re about to charge (Value for money)

The Associate (the one being referred) Must:

6. Be prepared to listen to the referrer (your colleague)
   a. And trust that they have their colleagues best interest at heart
7. Trust the judgment of the referrer that they fully understand the problem
   a. Or else they’ll be second-guessing and looking for a number of alternatives
8. Trust the referrer has considered your capability to fulfil those needs
   a. If not, they may hear you out, but also be seeking alternative solutions
9. The associate can’t be too invested in their path of the search for a solution
   a. Or it’s just too hard
10. They may seek out your credibility through verifying that the referrer had used your services before they offered the referral
    a. If not – why were you not good enough for them, more questions and low commitment will follow

Even when all that is successfully navigated, the referrer’s associate may not be committed to procuring the services right now, and could just be seeking information or research.

Gaaaah… I hear the frustration all the time.

I’m sure there are plenty of other challenges to aligning this relationship right now, but the above are the most obvious challenges to overcome, leading to a lower than optimal time investment in the process.

Think About the Last Service You Purchased

Word of mouth and research account for a successful approach to securing great service. Anecdotally, I’ve heard that as much as 96% of purchases will have some element of online research. 96% may an exaggeration, but considering my most successful procurement decision; they follow a pattern, a process.

1. I researched what I need in that circumstances
   a. Online and word of mouth – I’m pretty lazy so I asked other business owners or someone with expertise in the area to ascertain alternatives
   b. The process develops Trust in a few options and saves a truckload of time
2. Exploring alternatives for appropriateness and the capability of providers is my next step
   a. Having some level of exposure or experience of the provider strengthened my confidence in the selection
   b. Here I developed an appreciation of the credibility of the providers, could they do the job?
3. I considered how helpful, different providers had been, their openness and advice
   a. Even having a chat with someone from the businesses to ascertain if they understood my situation and had an appropriate solution
   b. This was about value – was I a business they wanted to help, did they value me as a customer

These elements of trust, credibility and value have replaced the ‘like know and trust’ we’re so used to hearing of the past. We’re no longer in the 1970’s (although the music lives on). We can research alternatives more effortlessly than ever before.

A New Approach

Instead of spending half a day a week to hopefully secure some business through a small group of people…

Imagine, joining experts in their field, Authorities in fact, who know their business, who are seeking to expand their business and who are happy to help small business owners overcome the everyday challenges faced by small business owners.

Imagine displaying your expertise alongside these authorities in their field. Establishing your own solution to one of the problems you’re answering every day (or week). You know those frequently asked questions, I call them “The first five”.

Imagine you, and the other authorities, all inviting prospects to explore the solutions, your own solutions, as a way of building trust, and displaying your credibility, offering fantastic value in the solutions provided.

And then the prospects, exploring solutions to alternative challenges they have.

For every prospect you bring to the platform, others have brought in many more, and the prospects are all small business owners, your ideal client.

Imagine if Every Referral Was a Prospect for You

Imagine attending a referral network group and every time a referral was passed, they also became a prospect for you?

How exciting that would be!!!

With the Better Small Business School – Every Student added and Every Authority added, is a prospect for you. Of course you still need to be active, in being responsive to discussion on the platform, helping others when they have challenges in your field of expertise, sharing your content on the website (the stuff you share on your own already of course) and adding prospects into the platform. After all, adding prospects in, is a path to closing that sale quicker.

Improve your conversion rate through educating prospects better, and have others who are already seeking solutions come to you…

That’s a path to feeding a crowd of prospects, hungry for what you have. Prequalified prospects who know they need what you do, have experienced your help, ready to buy…

That’s one referral quality enquiry right there.

If you’d like to find out the five ingredients in a quality sales funnel, reach out, email me at kevin@bsbschool.com.au and I’ll organise the download for you.