Networking Creates Value
When we first start networking using tools like LinkedIn, Ecademy, and Facebook and Twitter, we have no ready-made network within those tools. We can build a network by inviting people we already know and by connecting with those that we don’t. What’s clearly true is that in those places (eg. Ecademy) no direct value is being created by our presence until we have connected with others.
That’s not to say there isn’t indirect value by being a member without connections in any of those networks through the knowledge that can be absorbed from others. But for the context of this article I’m considering only the value created by connecting to other people for referrals and business.
In an earlier article I talked about how to build referrals on Ecademy, and a key element of that was being connected to, and having a good knowledge of, other people.
Not all connections are equal
In another article I talked about the journey to advocacy and the fact that wide networks attract people to approach and acknowledge your knowledge, skills and abilities, and ultimately to advocate you to others for business. One question that then arose is ‘how many connections create that value?’. Of course the best deal of a lifetime could come from the very first connection you meet and that could be an extremely valuable connection. Or it may be that you meet thousands of people online and don’t get any business, but does that mean those connections are worthless?
The law of large numbers means that your own experience will tend towards the average as the numbers involved grow. Here on Ecademy I’m approaching 30,000 connections. Since joining Ecademy 5 years ago my contact list has steadily grown and the level of business that I’ve generated through Ecademy has grown too. I’ve noticed that the closest correlation lies between my contact list size from about 18 months ago to the revenue generated in my business through my Ecademy contacts. The same isn’t true at Linked-in or Facebook where the business generated is much lower, but my engagement is much lower too. Of course the demographics are different too, in those places, and a different audience means a different approach will work. My strategy is based here on Ecademy, so it has my focus and attention. So the contacts themselves don’t mean much, but contacts and activity together does.
That time difference and the need for engagement is probably reflecting the fact that it takes time to get to know others and for them to get to know you through the things that you write and that they read. During that 18 month period conversations with those who are interested in your skills and experience take place and for some of them a greater understanding of you and your business ensues. From those people advocates grow, and from the advocates business arrives.
So, where is the quality?
It’s not possible to tell which connections will be the good ones, in fact I’ve demonstrated many times to myself that any attempt on my part to identify the right connections to make diminishes the number of good connections that I actually do make, other people are far better at seeing the connections that exist between themselves and me, and I’m better at sourcing connections for other people, I guess that’s just a skill-set that we all develop, here if we choose to open our student minds to the opportunity to learn it.
So my strategy has changed, and I have sought to follow up connections advised by others, who see a synergy, and to seek to provide insight into the synergies that I see to others, rather than trying to work it out myself.
All in all, I think over time my estimate is that a connection is worth between £50 to £100 in revenue or business generated over the course of the lifetime of the relationship, and I expect most great relationships to last, say, 20 years. So, I budget for referrals to arise worth around £5 per annum per person in my contact list 18 months ago. That’s just an estimate on my part, but I wondered what your experience was?
Does recognising that each person who connects with me will, on average be worth £100 over the next few years change my attitude to connections? Yes, it does.
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