Is business success about what you know, or is it about who you know? Well, what you know is important but unless you can find someone who needs what you know you're not in business. Having the product, the service or the knowledge is only half of the business plan. The other half is the market, and the market is who you know who needs your product. And it's about who knows you.

Marketing is about making sure that as many people as possible in your target market know about you and your product. There are a number of ways of doing this, advertising being the most obvious. But the most effective way of marketing is through a personal referral. People prefer to do business with people they know and trust, or with people who are personally recommended by those they know or trust. If someone who you know can personally recommend you to the person you wish to do business with, the chances of your concluding a deal with that person are significantly higher.

Obviously, the more people you know who can recommend you, and the more people they know to whom they can recommend you, the greater your chances of success.

Some people are fortunate to have a large circle of acquaintances that they can rely on for references to the right people. The school tie network is probably the most ancient and successful of the referral networks. But many of us don't start out with that extended network and we have to create it.

While networking has always been part of the business process, it is only fairly recently that people have begun to intentionally network as a primary means of marketing themselves or their business. The last decade has seen the development of "networking groups" which meet for the express purpose of networking. The advantage of these groups is that everyone understands what they are there for, which means they can market themselves unashamedly without the social pretenses that surround networking at a cocktail party or business dinner. Members of networking groups expect to hear what each person is doing and to tell the group about what they do.

Networking groups might be quite small, seldom exceeding 20 members and usually limiting membership to not more than one representative from each field of business. However, members of the groups are not limited to doing business with those in the group. Group members refer each other to their other business acquaintances, and so a group of 20 members can effectively deliver hundreds of qualified leads and contacts which come with a personal recommendation.
The power of networking has become such that large corporates sometimes send representatives to the small business networking groups to market their own services.

Some networking groups are casual gatherings which have grown over the years gathering like-minded people. Others are part of international structures and have a formal process. Some groups are run as businesses by full time organizers and some have volunteer coordinators who look after the administration.
Whatever their size or structure, all networking groups have the same objective, to make sure what you know gets to your market through the people you know and the people they know. They are the 21st Century's most powerful marketing tool.

Learn more about this author, Jonathan Payne.
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