How Many Referrals Do You Expect to Receive from Networking?

My answer to that question is based on several decades of experience in building and running the global networking organization, BNI_®. The number of referrals you should expect to receive is dependent on the type of business you are in, and the amount of effort you exert to develop your network.

We also need to understand that some professions receive more referrals than others. For example, a florist is going to get many more referrals from their networking group than a real estate agent. However, the florist will have to sell a lot of flowers to equal the amount of one real estate sale. Hence, the type of profession somewhat determines a range in the quantity of referrals.

Yet, the actual number that someone in a specific profession can get varies dramatically depending on their efforts to develop those referrals. This variation depends on how they “work” their networks. Do you remember the old computer adage “garbage in, garbage out”? It means that if you put bad information into the system, you’re going to get bad information out of the system. Well, our networking efforts are very much the same.

The results you can expect to get out of your networking efforts will be based on the quality of people you put into it, along with your time investment to build relationships with those people. A few years ago, I conducted a survey of business professionals in which I asked, “What percentage of your business comes from referrals or word-of-mouth marketing?” Even I was surprised by the results. More than two-thirds of the respondents said they received 70 percent or more of their business from referrals. Only 14 percent said that referrals accounted for less than 30 percent of their business, and only 2 percent said they got no business from word-of-mouth marketing!

Clearly, referrals are critical to the success of many businesses. The question is, how do you increase it? First, consider professions that are part of your contact sphere. These are businesses that have a symbiotic relationship to yours, serving similar customers in compatible, non-competitive professions. Contact spheres are the building blocks of your referral business because they help to build a solid base of repetitive referrals for you.

Next, consider diversifying your networks. It is beneficial to participate in different kinds of networking groups so that you may have a diverse cross section of businesses and professionals as part of your center of influence. It is important to understand that you must first build the foundation I speak of above before you can have high expectations for developing referrals.

Based on research that I conducted at the University of Southern California a number of years ago, I found that the average participant in a strong contact network or a business development network (groups that meet weekly and allow only one person per profession, and whose primary purpose is to pass business referrals) generated, on average, 4.2 referrals per member, per month, or roughly 50 referrals per person, per year.

Please note that there are many intervening variables to this number. In my study, these variables included such things as length of membership in the networking group, the profession they represented, the years of experience in that profession, the level of participation and more. One thing that did not seem to make a difference was gender. Both men and women generated substantially similar numbers of referrals throughout their participation.

The number of referrals you can expect will vary depending on your profession and your efforts in the networking process. However, on average, I’ve found that many businesspeople can generate more than 50 referrals per year via their participation in a single networking organization. What makes this number truly significant is that most people would agree that a referred contact is much easier to turn into closed business than other types of contacts. I believe this is the reason that so many professionals around the world say they generate most of their business through referrals.

What are your thoughts? Share below.

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