Connecting is not Enough - The Newsletter

The latest edition of my e-zine Connecting is not Enough is now available. As well as the usual mix of networking tips, video and fun, there is an opportunity to win a free ticket to next month's Entrepreneurs in London event at the New Connaught Rooms. But you have to act quickly, the closing date is today.



The current newsletter includes:

- Three Steps to Referral Heaven

- The personal touch online

- Why you should stop going to networking events

- Review of 24 Carat Gold.


Brush up on your networking and referrals skills here.

A breakfast meeting too far....

Last week I spent a couple of hours coaching a seasoned networker on his strategy. A member of several networking groups, my client attends up to five breakfast meetings a week, a couple of lunch meetings and also occasionally an evening event.

Despite this effort, he has been employing someone to make sales appointments through cold-calling and was explaining how he needs a sales person because of the time pressures he faces.

My client could point to business from his networking activity, and he knows that it works for him, but for me something was wrong. Surely someone with that amount of networking activity should not be relying on cold calling. Of course, there is nothing wrong with telesales as an alternative lead-generation strategy if it provides a return on investment, but it wasn't.

I asked my client whether he could use his time more effectively. I suggested that on two or three mornings a week instead of attending a networking breakfast, he should arrange to have breakfast with a key contact from his network. Or with a small group of them.

As I mentioned in this article, networking groups do not produce referrals, they feed your network with people who may then do so. An approach that relies on numbers of meetings cannot create a constant stream of new business, there is no depth to it.

The alternative approach is a strategy where you attend meetings to grow your network, but focus at least an equal amount of time on nurturing that network and deepening your relationships.

If you are attending a lot of networking events and not seeing much as a result, pull back and look at the contacts you have made from those events. Are you spending enough time assimilating those new contacts into your network and enabling them to understand how to help you?

When, if ever, is it time to quit building a relationship with a potential referral source?

Vena Ramphal has just asked me this question on Twitter. It's a very interesting question. Referrals come from people with whom you have built relationships over a period of time. In some cases the relationships may take years to develop. So how do you know when to focus your efforts elsewhere?

The first thing to understand is how a referral comes about. People are more likely to refer you, and provide you with quality referrals, the more they trust you and understand what you do. Some businesses need greater levels of trust and understanding before people refer them than others. For example, you will probably be more comfortable referring a printer you have only recently met than an accountant.

Everyone you meet and everyone around you is potentially a referral source. Whether they are clients or colleagues, family or friends, they will have their own network and will potentially come across opportunities to refer you.

A referral strategy, however, requires a degree of focus. While you can make efforts to build stronger relationships with everyone around you and communicate your needs more clearly to them, it makes sense to spend some more time developing specific referral relationships with a small group of people.

In each of these cases, you need to understand how much they want to and are able to refer you. In other words, how much do they trust you and understand what you do? These are the first two areas to focus on, unless they score highly on both these counts you can't start asking them for referrals.

To do so, you have to look at each person individually and ask yourself what will inspire them to want to refer you. How can you get them to trust you more? What do they need to know to understand better what you do and who you do it for?

Each of these steps take time. Some people in your network will be ready and able to refer you straight away. Others need a lot more attention.

It is this attention that provides the answer to Vena's question. In theory as long as a relationship is growing and remains positive, you shouldn't write off anyone as a referral source. However, if a lot of time and effort is required to develop the trust and understanding to a sufficient level for them to refer you, it is time perhaps to consider the return on that investment.

A harsh way to talk about relationships, perhaps, but a necessary evil. If you are investing your business time and resources in cultivating relationships with the intention of generating referrals, you need to have a clear vision of what success will look like.

Think about who people know and the conversations they are likely to have. Once they have reached a sufficient level of trust and understanding to refer you comfortably, are they re in a position to refer you on a regular basis to the people you want to meet? If so, carry on investing the time and effort to get to that stage. If they have a limited network and don't have the type of connections you are looking for, perhaps you should look elsewhere.

Ideal referral sources are in a position to keep introducing you to potential customers and other potential Champions for your business. Your referral strategy will be far more efficient if you develop strong bonds with ten key people who each refer you five or six times a year, than if you try to build relationships with 50 or 60 people who might refer you once.

I don't think you ever need to 'quit building a relationship with a potential referral source', or with anyone with whom you have a rapport. You may, however, choose not to spend as much time developing that particular relationship if the return is outweighed by the investment.

It takes more than a handshake to build a network

In his weekly Media Coach Radio Show last week, Alan Stevens interviewed US networking expert Thom Singer.

Thom's key advice resonated with my beliefs that simply shaking hands or exchanging cards at an event does not mean you are building a strong network.

Thom told Alan, "The biggest mistake people make when they're at an event like this and they meet people, is to think, 'Wow! Alan's now part of my network, we're buddies. We're going to refer business.'

"They go back and Link In to you and connect to you on Twitter and they think 'Wow! You're my friend'. The truth is when you meet someone one time, they're not part of your network They're someone you've met one time.

"The trick is you have to own the follow-up; to grow the relationship along to the point where you are actually business friends, or real friends."

How many times have you met people at events and instantly expected business, or referrals, to be exchanged? Or felt that they expect this from you? And how often has that actually happened?

Thom is right, simply meeting at an event and connecting online is not sufficient to establish a strong, long-lasting and productive relationship. It is so important to develop that initial contact into a conversation and use social networks or personal meetings to stay in touch and build understanding, rapport and trust.

Connecting is not Enough......The Newsletter

The latest edition of Connecting is not Enough is now available. As usual, the regular e-zine is packed with networking skills tips, referral strategy and social networking advice.

Included in this issue:

- Why would people want to talk to you at events?

- When a referral is not a referral

- Video: The dos and don'ts of social networking



- The Singing Chef!

CONNECTING IS NOT ENOUGH: When Week is Strong

This article originally appeared in The National Networker

How often do you interact personally with your customers? Whether it’s working directly with them, speaking to them on the phone, visiting their offices. If you’re not in regular direct contact there’s a good chance it’s impacting on your ability to either upsell to them or to inspire them to refer you.

A couple of weeks ago I Chaired The Retail Conference in London. One of the speakers was Hamish Paton, the Commercial Director of Brighthouse Stores.

Despite having a presence across the UK, Brighthouse may not be a name you recognise. You won’t find a Brighthouse in the main shopping centres or streets of any of our major cities. Instead, their stores are situated in the suburbs, within three miles and easy access of their main customer base.

Location genuinely is vital for Brighthouse, because their customers need to visit them every week. In a business model more common to the US than the UK, Brighthouse customers purchase products and pay for them on a weekly basis over a period of time, normally three years, without the need for credit checks.

With the theme of the Conference being responsiveness and adaptability, it was no surprise when one of the questions directed at Hamish after his presentation was whether Brighthouse had considered changing their model with the times, bringing in monthly payment by Direct Debit or internet purchase.

Russell’s response was very interesting. Brighthouse had considered such moves but had dismissed them for two reasons.

The first is that the Direct Debit/Monthly payment market is very different and one where Brighthouse don’t necessarily understand the customers and their needs as well as they do their established market. They currently service a much needed niche and feel that it is better to build on their expertise than try to dilute it through diversification.

Secondly, Hamish sees tremendous value in the weekly connection with their customers.

“Our staff are counselors”, Hamish told the Conference. “They get to know their customers well and if someone misses a payment, the first thing they will do is work with them to get them back on track.

“If someone doesn’t turn up one week we will call them to find out what the problem is and see how they can be helped. That personal relationship is absolutely vital and we wouldn’t be able to provide the same service, or enjoy the same interaction, if people paid automatically through Direct Debit.”

After Hamish’s response, I asked him how much of Brighthouse’s business comes through up selling to existing customers. The answer was an astonishing 80%, a particularly impressive statistic when you consider that Brighthouse advertise on prime time television, including a sponsor slot on the Australian soap opera Home and Away.

Equally revealing was Hamish’s response to my next question. Despite their advertising strategy, 40% of Brighthouse’s new business comes through referral from existing customers.

With retail having a very transactional business model, many retailers will be much less dependent on direct referrals from customers than other industries. I asked the audience how many of them could boast a similar or greater rate of referrals from the existing customer base. Not one person raised their hand.

Yet Brighthouse have a strong focus on winning those referrals, and the opportunity to both ask their customers and remind them of the request. They operate an incentive scheme which rewards both the customer making the referral and the new customer signing up with them. That incentive scheme is featured on in-store promotions and in the pack that new customers receive, but it is the weekly meetings that make the difference.

“When customers make their payment each week, our team take the time and speak to them,” Hamish said. “We try to engage them as much as possible; we call it ‘till talk’. We train our staff to have a conversation with our customers rather than just process a transaction.

“One of the really unusual things about our business is that the customers and staff know each other by first name and greet each other outside the shop as well. We have a coffee machine in store and sometimes people just come in for a chat.

“Our staff are genuinely members of the local community, and there are very few places on the high street where you can walk in and expect people to know your name.”

The growth of internet solutions, remote banking and autoresponders has moved businesses away from our customers in recent years. We increasingly find ways to provide solutions without the personal touch. While there are very strong commercial arguments for developing such a strategy, are we in danger of losing the personal touch?

Surely the less we see and speak to our clients the weaker the bond between us becomes. That can impact a business not just in terms of reduced customer loyalty and the ability to sell more to them, but it also reduces the opportunity to ask them to refer us to others. Among the conversations Brighthouse staff have with their customers, they will regularly remind them of their referral incentive scheme and ask for their help.

It’s the relationship that makes that possible, and for Brighthouse that’s built through weekly contact with their customers. How many of us can say the same?