Word-of-mouth is one of the greatest forms of advertising. We trust each other more than any commercial or ad we see. But you can’t force people to talk about you. If you go around recommending your own business to everyone you meet, people will think you are only trying to sell them something.
So, how can you incorporate a human element to your marketing? How can you increase your leads and referrals? There are many ways to maximize your potential referrals, but today I’d like to focus on Networking, more specifically, Exclusive Networking Groups.
If you haven’t already been exposed to one, Networking Groups consist of business people (typically small business owners, nonprofit organizations, and semi-independent salespeople like real estate & insurance agents) who meet at scheduled times to learn about each others’ businesses with the hopes of generating new leads.
Informal Networking Groups have a relatively casual format, with food and (alcoholic) beverages, games, and prizes, all of which make it easy to relax and mingle.
Formal Networking Groups usually have a regular schedule, and planned activities designed to facilitate exposure for the attendees. Activities might include speed networking, presentations, business card exchanges, etc. Some groups have an open invitation, some have free admission, and some require membership (like the Chamber of Commerce and BNI).
Some are also Exclusive Networking Groups, where membership and attendance is limited by demographic or business categories. My first exposure to exclusive networking was when the Amelia Business Network was formed. The idea struck me as interesting, but when I saw a list of members that had already joined I immediately saw a problem… I couldn’t join.
According to the ABN website:
“All Active Members will have their line of business protected from direct competition and/or conflict of interest within the group … invites should not be extended to those who represent a similar line of business of an Active Member UNLESS that Active Member has been contacted and welcomes the invite.”
This means that ABN (and BNI) members are provided exclusive membership within their category of business. If you are a photographer, then no other photographer can join. If you‘re a web designer, then you’ll have exclusive access to offer your services to ABN’s members and be the go-to provider for any referrals other members can send your way.
The initial appeal is obvious, your competition is removed from the equation, leaving you to reap the rewards. You become part of a tight tribe that makes every effort to work within a closed network.
However, there are several downsides to Exclusive Networking Groups…
Civil Rights,
Schmivil Rights
Some networking groups limit membership by demographics like gender or age. These networking groups focus on the betterment of the members within their demographic, such as helping women advance as professionals. I believe these groups can exist just fine without having rules about who can or can’t join. For example, locally we have The Young Professionals Council of Nassau County. (The YPC)
This year I made an effort to attend most of the YPC events and sponsor the organization. Then some things happened that opened my eyes. When I hung posters for YPC events on the door at Mixed Media, my clients would say, “Oh, Mixed Media is hosting an event? Maximize Your Marketing sounds interesting. I should go! Oh… it says ages 21-40, I guess I can’t go.”
This made me feel horrible and I worried what my clients thought of my sponsorship of the YPC. I told my clients their age didn’t matter and to come anyway. But they didn’t. They were afraid they might not really be welcome.
Nonetheless, a 40+ reflexologist showed up at Maximize Your Marketing. At the end of the event she explained, “I have been working for other people all my life, and I recently decided to go out on my own for the first time. I feel like that makes me a young professional because I have just as much to learn as everyone else here.” This made me quite happy to hear, and at the next YPC board meeting I explained how I felt, and repeated the reflexologist’s story. I proposed that rather than exclude those who have much to teach us, and create negativity, that we make the 21-40 age range our focus, not our exclusive club. The board agreed that we should give it a try, and (I believe) the YPC can have a more positive momentum now.
The Dodgeball Draft
Remember in school how there was always the kid who got picked last for the dodgeball team? Maybe you were that kid, or friends with that kid. Maybe that kid was your son or daughter. “That kid” represents any person that is excluded. Sure, it’s not quite as emotional as high school, and it’s just business right? No matter what aspect of life we’re talking about, rejection and exclusion spread negativity. I believe negative energy should be minimized in both business and society.
Sometimes kids choose team members because of reasons other than success. That can lead to an ineffective team. Exclusive Networking Groups have the same problem. The members are not chosen on merit of any kind.
While I was observing how ageism was affecting both the YPC and my own clients, something else happened. My clients would say, “Hey John, you should check out the Amelia Business Network, a lot of people there could use your services.” I would respond, “I’d love to, but I’m not allowed to attend. As a full-service marketing boutique, we conflict with at least two of their members. We offer printing, which conflicts with Amelia Island Graphics, and we also offer web design, which conflicts with My Web Refresh.”
My clients kept making the suggestion, so I decided to contact the founder of ABN to see if I could join. After all, Mixed Media is unique in that we provide comprehensive and integrated marketing services to small businesses and nonprofits. Mark noted that exceptions could be made at the discretion of my competitors, and said he would ask both of them if they would make an exception and let me join the group.
Both said no, of course.
At first I felt the sting of the dodgeball, but I was soon comforted by an interesting realization: my competition is scared, a decent consolation in my opinion. Would I have done the same thing in their position? While it might have been my first instinct, my experiences have taught me that transparency and accountability are important, the rest is just…
Smoke & Mirrors
Exclusive Networking Groups offer an appealing scheme. Excluding a competitor feels sensible on a primal level. We think “more for me” as if it were the last chunk of woolly mammoth meat. But it doesn’t make logical business sense in the long term.
If you live in a smaller community, the leads will dry up over time. One man’s competitor is another man’s lead. If you are pitching to the same exclusive members every meeting, what happens once you’ve gotten all the leads you can? For some businesses, this isn’t as big a deal, but what if you sell life insurance?
Additionally, there are no enforceable requirements of the network’s members to use member services and products. If you think the group’s plumber stinks, then you’ll be in the position of having to tell him so… or simply avoiding him. Oh, and that works both ways. If the members aren’t satisfied with your services, they won’t give you leads. They might not even tell you why. Real trust and success is earned, not purchased or leveraged through an exclusive membership. The human connection cannot be faked. If you think being part of the club will help you cheat your way around the competition, good luck! I’m not saying Exclusive Networking won’t work at all, just be aware that your competition is still out there, building sincere, long-term relationships. When you operate within a walled garden, you feel safe and in control, but the rest of the world is still growing all around you. Look at what happens to the US economy when globalization and international outsourcing occur. Our system breaks down. Which brings me to….
Destructive Competition
The fundamental problem with having a cozy exclusive networking group is its defining rule, no competition. They even have a term for this concept, Destructive Competition, defined here:
“Destructive competition seeks to benefit an individual/group by damaging or eliminating competing individuals or groups; it opposes the desire for mutual survival. It is “winner takes all”, the rationale being that the challenge is a zero-sum game; the success of one group is dependent on the failure of the other competing groups. Destructive competition tends to promote fear, a “strike-first” mentality and embraces certain forms of trespass.”
I couldn’t have put it better myself.
Now, let’s look at the opposite:
“Cooperative competition is based upon promoting mutual survival - “everyone wins”… through peaceful exchange and without violating other people. Cooperative competition focuses individuals or groups against the environment.”
So considering our global and internet-based economy, and the assumption that we want our society/economy/species to develop with some stability, which would you choose? “Survival of the fittest” does not mean what it used to in a world where sustainability and the internet are equalizing industries at an alarming rate. Destructive competition is dependent on the failure of your rivals, but exclusive networking groups do not actually eliminate competition, they create a false sense of security.
Embrace your competition, it makes the world a better place through stability, sincerity, and quality.
Tags: amelia business network, amelia island graphics, my web refresh, Networking, small business
hey there I just wanted to comment your blog and say that I really enjoyed reading your blog post here. It was very informative and I also digg the way you write! Keep it up and I’ll be back to read more soon mate
: )!!!
Great post. Haven’t read something this good in a while.
Yes, this is a new era and I applaud you for supporting a win/win vs. win/lose! With more of this outlook, we could have everyone on earth fed, clothed, and healthy too. Bravo!
You should not limit age either! (tongue in cheek)
I appreciate you taking the time read my blog, and the kind words!
Article updated for grammar and clarity, 7/18/10, 9:40pm
Very well written article and you bring up valid points. While networking groups can be an fantastic source of leads, connections, and business, there are down sides as well.
I’d like to add, that, as an attorney, my participation in some of these exclusive networking groups could violate the ethics rules. For example, I cannot refer to one specific individual without alot of disclaimers and explanations.
Also, there is some argument with the Bar about whether group members who recommend me to outsiders are soliciting business on my behalf, therefore invoking the applicability of a ton of ethics rules, disclaimers, etc.
I’m much more comfortable referring those individuals whom I’ve worked with and know do a phenomenal job. I have to be comfortable putting my name on the line, whether they are on a membership list or not. After all, if a referal goes awry for whatever reason, it comes back to me and my reputation. Not only that, but I truly want my clients, friends, family, etc. to be happy. I hope that I have helped them in some way. Whether it’s finding the right marketing company to represent their business
, selecting a financial advisor, or accountant, or any number of individuals, if my clients, friends, and family are happy, I’m happy too!
I am also one of those people who tend to find someone I like and continue to do repeat business with them. This presents another conudrum. If this particular individiual is not in one of my groups, I’m certainly not going to STOP doing business with them!
Jan,
That’s interesting. I knew the Bar had limitations on how one can market themselves, but had no idea it reached that far. I wonder if other industries would benefit from such restrictions. Then again, I’d probably have a lot less marketing work to do…
Thanks for the comments, as well as your assistance in fixing some of my grammar, etc
I love the thread here and good insight and comment Jan. I also commend your addressing the 21 – 40 thing John, but you say “I proposed that rather than exclude those who have much to teach us, and create negativity, that we make the 21-40 age range our focus, not our exclusive club. The board agreed that we should give it a try, and (I believe) the YPC can have a more positive momentum now.” I don’t understand how continuing to “focus” on it makes it any different than exclusion. It is a brand on the club and if you actually don’t mind over 40 attending, why have it? Based on the article’s premise of questioning exclusion, it is confusing and argues with your point of co-opetition….(I may still have a great book on that on my shelf I’ll give you BTW!).
Hmm, I think maybe I wasn’t clear in what I meant by the change of focus at the YPC.
What we’re doing with the YPC now is, making the goal of the group to help people of the “young professional” demographic, not create a club FOR young people. The YPC is, by its very name, at least obligated to help Young Professionals flourish (among other things, like community service). This is okay with me, as it gives the group a theme and focus. But it’s not okay with me to alienate or exclude people, particularly when it provides no real benefit to young or “old”, and spreads negativity.
Another example: (at the risk of opening a whole other can of worms) white people can join the NAACP to help protect the civil rights of colored people. Isn’t that how it should be? I believe any effort, whether personal, or with a group, should have an intended goal, and any rules or policies should only serve to support that goal. A networking group’s goal is to, obviously, network. How does excluding people achieve that goal? It doesn’t. That is a separate goal: to eliminate competition through artificial means.
I suppose we could go deeper and argue that even focusing on only one type, like helping the young, or helping minorities, or a single gender, could be alienating the opposite side, but I think that might be going to far. Then we’d have to distill our groups to simply be “people who help people” and nothing more. While that might be a great ideal, it wouldn’t get much attention or support, and thus become ineffective. Then this conversation would spiral into even more abstract ethics and morals of how humans should just love one another and whether that’s communist talk, or if it conflicts with evolution… I have always liked the idea of naming an organization “The Good Citizens Brigade” though…
I’ll stop ranting now!
Great blog! Keep it up! You make a ton of good points that people in every business can and should take to heart.
Just to be totally clear, ALL ages are currently allowed to participate in the YPC and attend it’s events.
My only disclaimer is that this is something I suggested to the YPC and they agreed to try. I’m not the “boss” of the group, but they were kind enough to hear me out and give peace a chance
John,
Great article! Having also recently started a new business on the island, I share your plight. Being a multi-discipline financial planner (investments, insurance, small business consulting), I am largely locked out from the exclusive networking groups since there is almost always an insurance guy or gal and a stockbroker or financial advisor in each one.
However, I’ve decided not to let it get in my way. I’ll still do my fair share of networking and hosting or attending various meet-n-greet events on my own. And all “duplicates” are welcome!
Thanks for reading, and for the comment, Mark!
Maybe we should start a networking group where the only rule is you can’t be a member of an exclusive networking group, heh!
WoW! This blog has generated alot of interest, both online and offline. The topic has been making the rounds in my conversation this week and I’ve heard interesting points all around.
As for the YPC (disclaimer: I am on the Board with John and others), I believe it will always focus on those individuals 21-40. Because the focus is 21-40, doesn’t mean that it’s anti-41+. Just because an organization is pro something, doesn’t necessarily mean that it is anti- the opposite. There is a need in our community for networking, professional development, personal development, and community service for those in the 21-40 age group. The YPC fills that need. Arguably, the ABN, Chamber of Commerce, BNI, Rotary, etc. fills the need locally for those in other age groups. If you attend events for the other organizations, youngsters are rarely involved, which is how the YPC developed—to fill that gap. Having a group that focuses the needs, issues, and concerns of business owners and others who are in your age group is extremely helpful.
John, if we started a networking group where the only “rule” is that you can’t be a member of an exclusive networking group, then you’re already excluding others (which I know you detest) by the very nature of your one rule!
Like I’d have time to be in ANOTHER group… I just applied for Leadership Nassau!
John, thanks for explaining further. After re-reading, I finally get it….about the focus of professional development. But I just want to point out to you that since SO MANY people take it as an age limit thing, perhaps there is a misunderstanding (hence miscommunication) about the premise for the group. Maybe the name, maybe by specifying age at all. I feel that you could call it the Young Professional Council of Nassau County while not mentioning ages…maybe just stating it mission as nuturing the development of young profressionals…..anyway…I am just giving you feedback from what is PERCEIVED. To change the uncomfortable perception or misunderstanding dealing with the age thing (if you really do want all ages to feel free to participate) you might want to consider adjusting the message. That might be the title – with a tagline like “Helping Young Professionals of Nassau County Grow” or something like that (just an example…not suggesting that exactly.)
And I am just thinking, I would love to help young professionals. I always had so many questions for the elder groups for advice during my rise up my ladder to get through the glass ceiling…..so I think it is lovely that that is the focus.
I can see you writing up a flyer “Calling all elder business statesmen and woman 40++++ Want your participation in our new YPC group, focused on blah, blah, blah and invite you to participate, share your business lessons, etc. etc.
just thinking out loud…good luck with it. invite Carol Zeff and Maria…her partner over at Madie’s retreat…they want to go….
I do agree, even without “rules” the name of the YPC will be an unfortunate deterrent to anyone that considers themselves not young.
If you, or any of your associates are interested in meeting the group, we are having a 2nd Birthday Party at Putt-Putt this coming week. Details at http://www.ypcnassau.com
I’ll try to make sure and note the same to Carol,thanks!