referral-based business | Dr. Ivan Misner®

28Jan2013

Knowledge Networking vs. Referral Networkingstring(44) "Knowledge Networking vs. Referral Networking"

Most people are involved in at least two types of formal networking groups. The first is intraprofessional networking, or “Knowledge Networking,” as Megatrends author John Naisbitt calls it. Knowledge Networks foster self-help, information exchange, improved productivity and work life, and shared resources, according to Naisbitt, who cited networking as one of the ten megatrends impacting our society.

The second type of networking is interprofessional networking: multidisciplinary professionals and occupational types who network to increase each other’s business. In fact, the primary purpose of most interprofessional networking groups is to increase one another’s business through referrals.

In good interprofessional networking, participants get either the majority of their business or their best business through referrals. Organizations such as the Chamber of Commerce, Jaycees, and BNI® are typical groups in this category. Different groups offer different strengths and weaknesses in helping to generate word-of-mouth business and it’s important to look closely at the makeup and structure of the various organizations that you might join before selecting those that best fit your needs.

If you haven’t had much success in business organizations in the past, don’t let that get in the way of doing what needs to be done to build your business through word of mouth today. The best way to begin the process of building a referral-based business is in a group or groups of other business professionals. The only alternative is to meet one person at a time, which inevitably means you’re going to be working harder, not smarter.

The only people who are going to make referrals for you consistently are people who know you and trust you: your friends, associates, customers, patients, clients, peers, and family members. Strangers are not going to consistently give you business. You need to start spending time with the right people in structured professional environments.

If you’re interested in building your business through referral networking, here are four tips to help you do it efficiently:

Join several different types of networking groups and diversify your word-of-mouth activities.
Develop your company into a Hub Firm, a firm that other companies rely on to coordinate efforts in providing effective services.
Don’t be a cave dweller. Get out and meet other business professionals in the myriad of business organizations which exist for that purpose.
The only people who are going to make referrals for you consistently are people who know you and trust you. You need to start spending time with the right people in structured professional environments.

Do you have any additional tips or tactics which you’ve found particularly effective in building a referral-based business? What has worked best for you? I would love to hear your insights so please share your thoughts in the comment forum below. Thanks!

10Sep2012

8 Tips for Throwing a Successful Business Mixerstring(47) "8 Tips for Throwing a Successful Business Mixer"

Establishing a word-of-mouth, referral-based business sometimes requires getting people to come to “your cave” to learn more about your products and services. Throwing a business mixer is a great way to do this yet, I’ll admit, throwing a successful business mixer isn’t easy.

However, if you remember that your primary purpose is to facilitate networking, you’ll be okay. Here are eight tips that will help you host an effective, successful business mixer:

If you have a large enough office, throw a business mixer there to get exposure for your business.
Plan the mixer no less than eight weeks in advance. Invite many guests and get people to donate door prizes.
Allow all to bring information on their products or services. Have one or more large tables set aside with a sign for this purpose.
Designate several “Visitor Hosts” to greet the guests as they arrive. When people start to arrive, make sure all fill out their name tags properly. Have few chairs available.
Conduct a short networking exercise, such as having each guest meet three people he hasn’t met before or having everyone find someone in a similar business and ask one another what their most effective networking tactics/efforts have been.
There are many innovative things you can do to make a mixer both fun and successful, such as have a “Meet Your (Business) Match” mixer with designated areas for specific business professions such as finance, real estate, health care, etc. Or, have everyone pick a card with the name of one half of a famous duo out of a hat. Then, each person keeps meeting people until he or she runs into his or her “partner.”
Always remember what’s mentioned in the intro to this blog: your primary purpose is to facilitate networking and if you focus on that and don’t try to distract from that purpose by dominating the event with speeches or presentations, you’ll be on track for mixer success.
At the end of the mixer, spend no more than about ten minutes doing introductions and giving door prizes.

If you’ve hosted networking mixers before and have some additional tips to offer or if you have interesting stories to tell about your experience with hosting a mixer, please share your thoughts in the comments section so we can all learn from what you have to say. Thanks!

9Jan2012

Getting to the Referral Stage with a New Contactstring(48) "Getting to the Referral Stage with a New Contact"

January 9, 2012

Ivan Misner

experience, generating referrals, new contacts, recommendations, referral-based business, Referrals, relationships, reputation Building Relationships, Connections, Credibility, Networking, Networking Prep, Networking Tactics, Referrals, VCP Process 6

People often ask me how to move a relationship with someone they just met to the point where the new contact feels comfortable passing them a referral.

I always say that the best way to get to this next referral-passing stage depends in part on how you came into contact with a person in the first place. Let’s say you met while giving a brief presentation to a group of people who are in your target market. Assuming you did a good job, then you absolutely have the possibility of receiving a referral, even though you just met. Why? Because the presentation moved you from visibility to credibility in the new contact’s mind and now they’re probably willing to risk their reputation and recommend you to someone they know.

The same thing is true when you’re out networking. If you have a good conversation with someone and truly add value to the conversation, then moving from visibility to credibility isn’t that difficult, and you’ll be in great shape for getting some referral-based business. What’s more, it’s not terribly important whether the person is someone you might do business with directly. Even if your businesses don’t match up, the other person might have information that’s useful or might know other people you’d like to get in contact with. It’s often worthwhile to develop a networking relationship with people who have little in common with you because they can bring an entirely new network into contact with yours and broaden your business horizons.

Just bear in mind that even if there is a strong possibility that you’re going to do business with this new contact, it’s probably not going to happen there at the networking event, where conversations last anywhere from an eye-blink three minutes to a long-winded seven. Instant business is not likely to be had. But if you follow up with a quick note a few days later, you can make some one-to-one time and come up with ways the two of you can help each other. That meeting is where you’ll have your best opportunity for a quick referral.

What has your experience been with moving to the referral stage with new contacts–do you have a tactic that seems to be particularly effective? If so, please share it in the comments section.

1Nov2010

What’s the Payoff for Developing an Effective Word-of-Mouth Strategy?string(75) "What’s the Payoff for Developing an Effective Word-of-Mouth Strategy?"

Developing an effective word-of-mouth strategy that results in a strong referral-based business takes endless time, energy, effort and, above all, commitment. The actions and steps necessary to create a successful referral-networking campaign are simple, yet far from easy; they take tremendous dedication and drive, and results can be a long time in coming.

So why should you put forth the time and effort to develop a word-of-mouth strategy for your business? Because, if you commit to doing it right and don’t give up, the payoff can be unbelievably high.

In fact, many businesses have become so adept at referral marketing that they get most of their sales through referrals and spend little or no money on advertising — and they never have to place cold calls. Some of these businesses hire most of their employees through referrals, manage complex financing arrangements and even procure necessary products through referral contacts they have cultivated for many years.

But a referral-based business can reward you in ways beyond those measured in dollars. Dealing with people you like and trust is a better way to live and work than sparring with strangers all day long. You may even find the relationships you form with your referral sources more important than the dollars your new customers bring you. Such relationships are central to both the referral-generation process and the satisfaction you derive from your work.

So, the next time you find yourself doubting whether your networking efforts are really worth it, remember: If you don’t give up, and you continually devote yourself to working on making your word-of-mouth strategy better and better, the payoff can be enormous both financially and in terms of happiness in business and life.