Networking Tips: How to Measure Your Networking Success
I Was Exhausted!
As social media began to become THE way to network, I embraced it totally. At the same time, I was also networking IRL (in real life) like crazy. Chambers, leads groups, events... you name it. I was getting recognition, but getting exhausted, too. And my financials weren't painting a good picture, in spite of my efforts.
So that's when I sought out some professional help and hired a business coach. And that's when I learned how to more accurately measure my networking success. Not all networking venues are equal in terms of the opportunities they offer.
Here are some of the things I learned from my analysis...
How Should Networking Results be Measured?
This is one of the toughest topics! While you could do some super sophisticated analysis of interactions, events, etc. (yes, I've done some of that and it's a project!), that is usually beyond what most small business owners and entrepreneurs are willing to do. So to get a rough idea of what's working and what's not, you need to track some simple metrics over time:
- Number of Activities by Group. These could be either offline or online or both.
- Amount of Time Spent in Each Group. This will be an eye-opener! Don't just track the amount of time for the actual event or meeting. Add the amount of prep, travel and recovery (yes, recovery!) time needed. This additional time can balloon your networking time exponentially.
- Number of Referrals Received from Each Group. These are genuine connections and introductions sent your way by someone else.
- Number of Referrals Given to Each Group. A good metric to determine if you're contributing or are able to contribute. You may want to include your purchases from network members. But if almost all of your referrals are your personal purchases, that's a red flag since it can mean that your personal pool of contacts is not very deep or relevant. Or it can mean that the people in the group have nothing to offer the people you know. Either way, it can signal a bad fit.
- Number of Sales Made from Each Group. The actual total number of transactions you complete.
- Total Dollar Value of Sales from Each Group. Your total sales revenues, apportioned by group source.
- Number of Direct Visits to Your Website. This number can be found in Google Analytics. The program logs how many people actually type in your website's address direct into their browser. This can be a pretty good measure of people who have seen or received your information, business card, press about you, etc. and typed in your web address to learn more.
- Number of Visits to Your Website from Social Networks. Google Analytics now has a breakdown of visits your site receives from social media. Really helpful to figure out if all those tweets and Facebook posts are generating any web traffic.
How Often Should These Stats be Tracked and Tallied?
While it will depend on how active the business is on a daily basis, for small businesses, tracking activity and sales results achieved every week—or monthly at minimum—is usually sufficient help keep things on track. Then analyze monthly, quarterly and annually.
Analyzing Networking Numbers
Each of the metrics discussed above must be time bound, for example, for the calendar year, this fiscal quarter, etc. Be aware that to gain more accurate trends, these metrics must be measured and monitored over an extended period of time (minimum of one year).
While you could get pretty detailed in how you analyze your networking metrics, keep it simple. Below are just six of the ways you could evaluate your numbers. There could be other important comparisons, too. Pick those that are most relevant for you, but do pick at least a few analyses to make an accurate assessment.
- Number of Activities by Group to Number of Sales Made from Each Group. Where the rubber meets the road! Evaluates whether your networking is working.
- Number of Activities by Group to Number of Referrals Received from Each Group. Like comparing activities to sales, this provides a good measure of how active and valuable the connections you're making are. If your referral level is low, might be time to reevaluate your networking groups and activities.
- Number of Referrals Received from Each Group to Number of Sales Made from Each Group. Evaluates the quality of the referrals you're receiving.
- Number of Referrals Received from Each Group to Total Dollar Value of Sales Made from Group. Evaluates whether the referrals you're receiving are worth anything. You could be getting a lot of low dollar value business that increases your workload. It often takes just as long to manage a low dollar sale as it does for a bigger one. Good metric of the efficiency of your activities.
- Total Number of Activities Completed to Total Dollar Value of Sales Made. You'll get an idea of how much personal effort it could take to generate a certain sales volume.
- Number of Activities by Group to Number of Referrals Given to Each Group. This is a good metric of whether you're a good fit for the people in your network. Remember, networking is a two-way street.
A standard spreadsheet type program (such as Microsoft Excel) can be used to build these analyses. Here's an example...
Example Networking Activity Analysis
Number of Activities
Number of Referrals Received
Networking Group #1
Networking Group #2
Networking Group #3
Don't Jump to Conclusions
CAUTION! Avoid the temptation to expect networking events results immediately or even within the immediate time period, such as this quarter. You're looking for long term trends.
For example, you log a certain number of networking events in this quarter and a certain number of sales or referrals. But don't think that the events in this quarter were the exact ones that generated those results. The event you attended 6 or even 12 months ago may have generated the sale you made today. So when beginning to track these stats, give it at least 6 to 12 months before deciding that this or that networking activity or group isn't working. It takes time to build the trust and relationships needed to do business.
Your expenditure of time, travel and talent are investments. Always measure the ROI of your networking!— Heidi Thorne
As Your Business Changes, So Do Your Networks
What networking activities and groups worked this year may be totally irrelevant next year... especially if your business has changed.
In one year I dropped two networking groups in which I had been very active just because my business changed. These groups could no longer provide the types of referrals and sales I needed to grow.
It was a tough choice since I did genuinely like the people in these groups and some had become friends. But only through doing analyses like those discussed here was I able to emotionally muster up the courage to make a stand for my future and finances by letting go.
Disclaimer: Both the publisher and author have used their best efforts in preparation of this information. No representations or warranties for its contents, either expressed or implied, are offered or allowed and both parties disclaim any implied warranties of merchantability or fitness for your particular purpose. The advice and strategies presented herein may not be suitable for you, your situation or business. Consult with a professional advisor where and when appropriate. Neither the publisher nor author shall be liable for any loss of profit or any other damages, including but not limited to special, incidental, consequential or punitive, arising from or relating to your reliance on this information.
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© 2016 Heidi Thorne