Networks have always been the key to business success. Henry Ford was asked what he would do if he woke up one morning and found everything gone. He replied that as long as he had his contacts, he’d get it all back in short order.
Now, the Internet has changed the network landscape making worthwhile connections simultaneously easier yet more difficult to create. It is easier because we have access to huge and targeted audiences of people with whom we can connect. It is harder as the extraordinary breadth of our potential connections makes it hard to sort the wheat from the chaff.
We are inundated with information as never before, yet we also have a need to make use of that information and act quickly on business ideas and decisions.
I read an impromptu test done on the Wall Street Journal where people that had just read the paper were asked to identify the whole page ads that they saw as they were reading. Not one of them could remember one full-page ad. Next, the readers were shown the ads with the brands/logos hidden and asked if they could remember the ad and who it was for with the added information in front of them. Not one of them could remember the ad or the company. Those ads cost as much as many houses, yet are ignored.
Digital video recorders, Tivo, etc. allow us to record any program on TV. We can then pause, record, skip forward, etc. as we see fit, which destroys the notion of a captive audience that TV executives used to sell ads. Yet, companies continue to buy the ads because it was such a profitable way to market and do business for 50 years!
The old school marketing people respond to these types of comments by saying it’s a numbers game. Put the ad in front of enough people and brand awareness will go up and influence sales. Is that how you want to spend your marketing budget? Market this way and have “faith” that results will come… I sure don’t!
The two most successful TV ads of all time are Coca Cola’s, “Have a Coke and a Smile” and “I’d Like to Teach the World to Sing.” The leading marketing executive at Coca Cola for those ads admitted that they couldn’t trace any rise in sales to those ads. Think of the millions spent and for no measurable results! Lipstick on a pig if you ask me…
Now we all have access to potentially millions of people by using the Internet for our networking and marketing. For small businesses, using social media produces the best, quickest and least expensive results, yet can lead to frustration and loss due to the complexity, changing landscape and evolving attitudes towards social media.
As an example, I’ll look at trying to stir engagement (without a paid ad) on Facebook , which has over 1 billion registered users. Each time you post something on Facebook, around 16% of the people you are friends with will see it. If you have a link in the post that you’d like people to click, around .77% of those that see it will click on it. If you are further trying to encourage a behavior such as exchanging and email address for a report for instance, you can expect an average conversion rate of 20%.
If you have 1,000 friends or fans and post a message with a link you’d like people to click on, the math tells us:
1,000 x 16% = 160 will see your post
160 x .77% = 1.23 people will click on your link
1.23 x 20% = .25 people will sign up for your landing page offer.
So, to get one person to sign up, you’ll need to have your message sent to 4,000 friends or fans… How many friends or fans do you have? I hope a lot if you’re going to play those odds.
Twitter has 500 million registered users of which 200 million are considered active users. The other 300 million have accounts they never use or are robot generated “spam” accounts. If you post on Twitter, around 5% of your connections will see your post. The conversion rate for Twitter link clicks is .69%. That’s even worse than Facebook.
LinkedIn has 175 million users and sells ads, but it is hard to find much data on conversions. Their average member earns over $100K and many jobs are advertised / found there. In fact, their profiles are laid out much like resumes although you can now adjust them a bit. The challenge with LinkedIn are the barriers they put up that prevents easy networking between people that haven’t met. You must go through a cumbersome “introduction” process or pay to upgrade to contact people.
So now we can get our message out to thousands, but the actual message typically falls on deaf ears as we’re all almost immune to media intruding into our actions. On the other hand, sites like LinkedIn are designed for networking, but put barriers in place that have seen the site evolve into a combination of a networking site and a job board.
Both traditional networking and traditional marketing have been disrupted. While digital marketing can produce exciting and productive results in the hands of those who understand it, networking remains the powerful business tool it has always been.
Traditional networking is time consuming and haphazard. Futile is the time spent at BNI meetings or other business gatherings where the sole focus of everybody in the room is to typically give away and collect as many business cards as possible before rushing home to start sending emails to people who won’t remember them.
No, we need a new networking model. We need a model that takes advantage of technology to expand our networking globally, but in a manner that keeps the best of the traditional networking intact. It should have the advantage of providing “vetted” connections from trusted sources or sites. Those engaged should be willing and eager to connect and help each other. It needs to exclude those who would only fling business cards at us or that are more interested in collecting connections instead of building relationships.
What we need is the Centripetal Network and from realizations and partial solutions we’ve seen, Chris Windley, Chris Butler and I have launched this solution. We’re excited about the potential and have already seen real connections being made that are influencing development. Stay tuned for further launch news and let us know if you’d like to be on the notification list. Or just drop us a note and let us know your thoughts…
You’ll find the three of us at our Centripetal Network site or on our Centripetal Network Facebook page (would be great if you would come and “like” our page).
Cheers!
Michael
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Michael Nelson
The Cogent Coach Blog – #8 Small Biz Marketing Resource on the Internet
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