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Marketing your small business through a referral network is smart. Thats why a customer referral program is one of my top recommended sales promotions (for the complete list, see Tightwad Promotion: sales programs that sell). But, sometimes you need to go networking beyond your customer base, to get new sources for referrals. On start-up, for instance, or when seeking out new marketing opportunities.
Many small business owners join networking groups, which can be helpful. (For more about such groups, see the article Business networking groups: how to be more productive in less time.) The problem with networking groups is that their nets typically include only one person from each industry. One janitorial service, one accountant, one website designer, one marketing consultant, and so on. The benefit is that no one is in competition. The drawback, is that the networking group may be too diversified to be helpful to you. In the above example, if the website designer and marketing consultant both work out of their homes, then the janitorial service isnt likely to pick up any business from them directly. It may pick up referrals, of course. But the referral (give John a call - hes part of my networking group) will be less-convincing than a referral from a satisfied customer. Also, the accountant may find, to her dismay, that everyone in the networking group who needs an accountant already has one.
For a more-productive network, remember that net comes before work. Thats the Tightwad Marketing twist: before you go networking, go netting. What is netting? In blunt terms, its catching the right people in your net first, so you can work your connections with those people to your maximum advantage.
How to go netting
When you go netting, your goal is to catch in your net people who can give you the most business, directly and through referrals. Youre looking for people who (a) can use your product or service and (b) are similar to each other, or at least can be contacted (by you) in similar ways.
The reason you want people who can use your product or service is because there is nothing as convincing as a referral based on personal experience. The reason you want people who are similar to each other is to make it cost-effective for you to move on to the next step, which is working your net - networking. Most networking focuses on the first part, but its the second part that makes your networking efficient.
Netting takes a bit of thought. But, you eliminate time wasted networking with contacts who arent in a position to give or get you business. Youll be able to put yourself in the path of more business, more quickly.
Examples of netting
You might focus on netting in the area immediately around your place of business. There are many reasons you should look for networking and marketing opportunities close to home. For one thing, it keeps competitors away from your doorstep. For another, it keeps the cost of doing business low.
Story minute: In the late 1980s I worked as a copywriter at an advertising agency on the fourth floor of a 12-story office building. One day, the VP Account Services read in the trade press that an account with an advertising budget of perhaps a half-million dollars had been reviewed and awarded to a competitor. This would have been minor news … except that the account was two doors down the hall. We had ridden up and down the elevator with their people for years. Immediately after that, the ad agency introduced itself with gift baskets and portfolios to all the businesses in the building, and landed some projects and referrals. But, they never matched - or stopped kicking themselves over - the One That Got Away.
Likewise, go netting in the areas immediately surrounding your customers or clients. One customer can be a foothold into a whole neighborhood or office building of potential new business. For example, a gardener might do marketing directed at neighbors of his current customers. Its much more cost-effective for him to get business from four or five houses in a row, than to have his clients widely scattered.
Another way to go netting, is to look for specific market niches. For example, if an accountant does the books for one janitorial service, she may look for added business from other janitorial service companies. She may attend the same events attended by people in that industry, or join related trade groups. If you or your business has experience in a certain area, then capitalize on that experience by seeking out groups of customers who need it.
Remember: what you want for your small business, is a referral network made up of customers who know potential customers.
Benefits of netting
Once youve built your net, start networking by creating connections, asking for business and referrals, and following up on leads. This part is the same as traditional networking, but youll enjoy a significant competitive advantage. Thats because you wont be networking in the world at large, or within someone elses collection of businesspeople. Instead, youll be networking within your own hand-picked group of people. By netting first and networking second, youll build your business and save time doing it. Thats networking, the Tightwad Marketing way!
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