Tuesday, January 05, 2010

The Road Ahead : Networking at the beginning of a new Decade

In an article at the end of 2008 I talked about how we were on the verge of a new age of networking in the UK, with the move away from referral networks, a more considered approach to networking by businesses and in particular, the growth of choice for businesses using social networks. Little did I know the extent of the changes to come so quickly.

Just one month after writing the article I joined Twitter. Founded in 2006, 2009 really has been the year of Twitter. According to Jason Keath of socialfresh.com, Twitter membership has grown from between two and four million users at the beginning of the year to forty million now. With the increased popularity of Blackberries, iPhones and other Smartphone technology, people can ‘tweet’ on the move…and they like it.

Although I could see big changes in networking to come at the beginning of 2009, the popularity of Twitter and other online networks has moved networking on at a pace I certainly didn’t predict. The worldwide economic climate has also had a big impact on the way businesses and individuals network and its importance to them.

So what can we expect in the year ahead? I want to look at the impact the recession has had and continues to have, on business networking; what we can expect from both online and face to face networks and also the changing importance networking will have for larger businesses.

Social Media

Given the impact that Twitter, Facebook and LinkedIn have had on business networking this year, the online world seems the obvious place to start.

The most popular social networks, such as Facebook, MySpace and Twitter, are not ‘business networks’ in the true sense of the term, having been created for social use. However businesses are increasingly embracing all of them.

MySpace is the home for bands, artists and others in the entertainment industry. Other businesses have been more comfortable using Facebook and Twitter, but many of them slowly and reluctantly. I still find that most of my clients, particularly those working for larger organisations, are unsure about using Facebook despite the growth of business pages, ‘fan’ pages and pay per click advertising. Those that do use it prefer to focus purely on using it for social purposes.

There are, however, a growing number of people using Facebook for business. The big brands are making sure they have a presence on the site but it’s mainly smaller businesses, particularly micro-businesses, who use it actively.

In my previous article I said that we needed to move away from people simply looking to connect with as many people as possible across all social networks. This is still a problem. It seems to me that many of the people using Facebook for business still try to build as big a network as possible without worrying about building the relationships. That goes for both large and small businesses. People need to start realizing that networking is about engagement not numbers.

If we can get back to real engagement across Facebook and people become comfortable with who they allow to cross the ‘business/friends’ threshold and what they share with them, we may well see more people working in larger businesses open up their Facebook network to work contacts. There is still a lot of understandable nervousness about doing this so it will be a gradual process.

The growth of Twitter has had an impact on Facebook however.

Twitter has an unfair reputation of being a waste of time, with the common put down being “why would you be interested if someone’s having a coffee?” Many businesses are using Twitter very effectively though, with Dell Computers attributing $3 million worth of revenue to their Dell Outlet Twitter account*.

Savvy business people are raising their profile through Twitter, using the network to share their blogs, build their reputation, ask key questions and more. It’s a great way of keeping your finger on the pulse of business and world affairs and to continually engage with your network. Not only that, it’s also incredibly viral, with your followers happy to share your wisdom with their network with just the click of a button.

The quick hit of a 140 character Tweet makes the site more appealing to many time-poor business networkers than other social networks and this is perhaps where Facebook has taken a hit. Maintaining interest and engagement in a Facebook Group set up for your business can be quite time consuming, while you can dip in and out of Twitter quite quickly and painlessly. Some people who have started to develop a Facebook strategy have quickly left it behind and focused their attention on Twitter.

I anticipate that Facebook will continue to grow over the coming year and I do think that there will be more business use. Twitter’s popularity will, however, restrict that use and many people will prefer to simply post on Twitter and let that feed through to their Facebook page.

I believe that simply feeding one social network with your content from another is a mistake. Wherever possible we should treat each social network individually, based on what we are looking to achieve from it. Why use multiple networks for one purpose?

The language used on Twitter looks out of place on a Facebook page and automated feeding of updates doesn’t discriminate. As a result, some people’s Facebook pages have become meaningless lists of one side of various conversations and couldn’t be less likely to engage visitors. I’d love to see this habit die out. Yet we will still see more applications making it easy for us to update multiple social networks at one time, leaving less differentiation between networks and less reason for people to visit each one of the networks of which they are a member.

Many major marketing agencies now have specialists focusing on social media strategy. I do have a concern that the more the bigger brands embrace Facebook and Twitter, the more smaller businesses could disengage from the sites. Whatever size the business, we need to use these sites to speak with our networks, our customers and our prospects. It’s important to have a two-way process and listen as much as broadcast if the networks are going to maintain their popularity.

As well as the social networks, there are specific business online networks, with LinkedIn enjoying the most successful 2009. Based on the principle of six degrees of separation, LinkedIn is, in my opinion, the site that offers the clearest and potentially best rewards from online networking sites. The trouble is that most people don’t know how to use it effectively.

An article in the Wall Street Journal on December 30th reported how LinkedIn have been opening up to third party developers who want to create applications for the site, much as Facebook have. This is on the basis that LinkedIn users spend much less time on the site than users of other social networks, such as Facebook. (Visitors spent about 13 minutes on average at LinkedIn during October, while Facebook users logged about 213 minutes and MySpace users spent 87 minutes.)

While the right third party applications will help to enhance the LinkedIn experience for some, I think that the focus is in the wrong place. Offering users more applications risks confusing many members, as other sites have found. LinkedIn should focus instead on educating their members on how to make the most of the site. The fact is that you should be able to spend less time on LinkedIn than on other sites and still get greater rewards if you use the site effectively and target the right return.

Now more people have become aware of the potential of LinkedIn, I’d like to see it coming into its own as a referral generation site over the next year and I’m already seeing signs of that happening, I’ve certainly received more requests for connections through LinkedIn in the last few months than ever before.

Face to face networks

So where does this leave the face-to-face networks? There have been fears expressed that the growth of online networks and their convenience will make people less likely to want to attend physical events. Although some people have taken that approach, I think the opposite is true.

While online networks help to broaden our connections and raise our profile, I remain a great believer that you cannot build the same depth of relationship online that you can when you see the whites of people’s eyes. The growth in popularity certainly affects the development of face-to-face networking though.

There has already been a move by a number of face-to-face networks to develop a strong online arm to complement their offering. From alliances with existing social networks to the development of their own online networks (as demonstrated by 4Networking’s 4Community in the UK), traditional networks recognise that they can’t be left behind by the online revolution.

The challenge for them is the reticence of some members of traditional networks to get involved online, together with the growth in the number of social networks. People don’t want to be members of too many. With that in mind, they need to get enough members involved to develop a strong enough discussion to make it worth people’s time visiting and to keep them there. If they can achieve that, they can offer their members a much deeper service, connecting them with each other in person and online and bringing groups around the country, or the World, together.

The growth of online networking has also impacted on face to face networking through more meetings stemming from online groups. The Meetup site has spawned a number of such groups, many stemming from LinkedIn, while Tweetups have grown in popularity too.

This has led to a greater diversity of choice of events; with the growth of niche networks predicted in my previous article. There are networking events for people looking for investment, those interested in property, people in fashion, the arts, the media, bloggers, politics, women’s networks… the list is endless.

The choice of events available to businesses wanting to network means that traditional groups, from Chambers of Commerce to referral networks such as BNI, will have to keep on their toes, keep thinking creatively and perhaps look for ways to enhance their offering and continue to innovate if they are to maintain their relevance to their existing membership and attract new members.

The abundance of networking options also affects the membership fees traditionally charged by networking organisations. With a host of events available for free, members of networking groups will want to see higher fees fully justified. The upside of this is that more businesses are looking to see what the return on their networking investment is, and thinking through how they spend their time. It will be a struggle for some larger organisations though, who rely on such fees to stay in business.

The Wider World

The economic crisis over the last two years will provide one source of consolation to traditional networks. While there is far greater choice than ever for people looking to network, there are also many more people who want and need to do so. The sheer number of redundancies will have led to a surge in consultants and micro businesses, people choosing to take their chances and go it alone rather than risk trying to find another job in a tough and uncertain market. The first piece of advice they are likely to have received when setting up their business in many cases will have been, “go out and network”.

Additionally, I expect to see more networking activity from corporate sales teams in the coming years. The budget cuts forced by the recession, together with the rise in popularity of LinkedIn among staff nervous about their jobs, has raised the profile of networking as a route to market. Sales teams are beginning to recognise the need to work smarter and attend more events. Budget holders are also demanding greater results from staff who previously just ticked the box by attending events. Now they feel more pressure to show a return on the investment.

My only concern is the perceived need to show short-term results. Traditionally sales people from large organisations have followed their instincts and looked to sell at events. When they have inevitably failed, they’ve written off networking as a route to market. For corporates to realise the potential from networks, they have to take a much more strategic, long-term view and give their teams the confidence and freedom to build relationships, help others in their network and generate referrals over time.

Similarly, away from networking events, sales teams have a wealth of potential new business introducers within their existing networks if they embrace a strong referral strategy. It’s time for them to move away from looking at referrals as an afterthought at the end of a client meeting and hone a more focused approach. Marketing teams have shown that they recognise the power of word of mouth marketing through viral and buzz marketing, as well as social media. The next step is to develop this into the referral arena. This will take time and I’m not sure that we will see this on a wide scale in the immediate future.

Networking Internally

Of course, networking is not just about sales and perhaps its key role currently in corporate life is in personal career development. This is a trend that I expect to see continuing and perhaps even accelerating.

With less job security and flatter management structures providing fewer opportunities to progress, people need to network to develop their career. There is less of a culture of ‘a job for life’ than even ten years ago and people’s networks both internally and externally play an ever-stronger role in their career planning.

If you work in a large organisation you need to have a strong profile across departments if you want to progress your career. Internal networks play an important part in helping people make the connections and have the conversations they need. Most major organisations have women’s networks and an increasing number of similar opportunities will present themselves. I believe that the ability to network effectively will increasingly become a skill that employers look for when recruiting for new positions.

The Future of Networking

Relationship-building and strong networks are becoming more vital as the nature of business and employment changes. These qualities have grown in importance over the last decade but the combination of social media technology and the economic climate over recent years has accelerated that growth.

We are entering a period where those with weak networks and poor interpersonal skills will find life increasingly difficult. And it will be the same whether you run your own business, are employed by someone else or you are a student looking at your plans for the future.

In a connected society, those people who have the wherewithal to build and leverage a strong and diverse network are going to have the advantage. We now hear more talk about ‘relationship capital’ and ‘social capital’, further evidence that human connections are becoming recognised for their role in business and career building.

The tools are now in place to help people who want to take their relationships to another level. A clear strategy for doing so, together with a strong focus on why, will help make the difference.

*Direct2Dell blog June 2009


  1. My favourite bit: "Networking is about engagement, not numbers". Please may I quote you?

  2. Of course you can :-)

  3. "the more the bigger brands embrace Facebook and Twitter, the more smaller businesses could disengage from the sites."

    I dont know about that. I think the sheer number of small businesses using Twitter is more than a match for the manpower that a corporation would allocate to Twitter.

    I am a small business and I follow mainly small businesses, who seem to get the idea behind Twitter. I just DMed a corporate Twitterer about their hopeless attempts at engagement, saying I would block them if they didnt change. By coincidence, they responded the next day with a genuinely interesting piece of info and a link that didnt land up on their site.

    Not saying David slew Goliath, but if they hadnt "seen the light" so to speak, I would have gladly told all my followers about that big corporation's steady flow of self promotion and presumably, despite their size, that company's influence would have dropped accordingly. Just a thought.