The Power of Networking
This man earns an extra $400 a month
This is an example of the power in word of mouth advertising. There is power in word-of-mouth advertising that can never be bought through regular advertising channels.
This man earns an extra $400 a month.
Another friend, Mike, knows everyone has to eat. Mike searched out a grocery company that didn’t want to be limited to a few stores or locations, but wanted to market groceries nationwide. Instead of opening and staffing supermarkets, they decided to operate a large warehouse and ship groceries via United Parcel Service directly to the consumer’s door.
Does this work?
The grocery company doesn’t have to invest capital in stores or shop assistants. The savings easily pay for shipping non-perishable groceries directly to the consumer’s door. The grocery company also saves a fortune by refraining from paying for full-page newspaper ads.
But how do they get their message out to potential customers across the country? Word-of-mouth advertising is the answer. Because people let others know about their convenient, price-competitive, to-the-front-door service, the grocery company can use its advertising budget to reward their “word-of-mouth” advertisers.
Mike simply says, “Are you tired of standing in checkout queues? Would you want your groceries delivered to your door for the same price? Read this.”
He hands the person a brochure explaining the service. If the person becomes another satisfied customer of the national grocery service, Mike earns a monthly word-of-mouth referral bonus.
How does Mike feel about this referral or networking concept? “It’s a lot easier to get a $400 word-of-mouth monthly bonus check for a little conversation than to get a $400 pay rise.”
Why it works
The networking, or referral, concept is simple. Businesses who participate love the no-risk advertising it provides. Individuals love getting their piece of the advertising pie for doing what they have been doing for free.
Among the types of products and services that successfully share their advertising budget with individuals are cars, appliances, legal insurance, food, clothing, sports equipment, buyer discount services, confectionery, health foods, travel, soft drinks, water filters, utility services, and the list can go on and on.
Somewhere, almost any product or service is now being offered through referral or network marketing. Remember, not every company will share its advertising budget, but surely one of its competitors will.
“Just two more referrals and …”
Phase 2 (The concept expanded)
Remember the Mr. Food supermarket? If you have an average family, you may spend as much as $500 monthly for groceries. In one year’s time, your purchases would add up to $6,000. You can see that every family added to Mr. Food’s customer base is very important to Mr. Food.
Let’s say you refer your neighbour, Alice, to the wonderful service and food selection at Mr. Food’s supermarket. Alice’s family purchases an additional $6,000 worth of groceries from Mr. Food. You are now responsible for $12,000 in grocery sales for Mr. Food’s supermarket. Surely, you’ll be earning a nice cash bonus.
But what if Alice refers her brother’s family to Mr. Food? That is an additional $6,000 in sales. Of course, Alice will receive a word-of-mouth advertising bonus for referring her brother, but what about you?
You didn’t actually refer Alice’s brother. However, if it wasn’t for you referring Alice, her brother would never have known about Mr. Food. You might consider yourself INDIRECTLY responsible for introducing Alice’s brother to Mr. Food.
Now you are responsible (directly and indirectly) for $18,000 in annual grocery sales for Mr. Food.
You $6,000
Alice $6,000
Alice’s brother $6,000
Total $18,000
What do you think you deserve for referring $18,000 in annual grocery sales to Mr. Food? 5 percent ($900)? 10 percent ($1,800)?
What if Mr. Food could stop its full page newspaper advertising altogether and let you be responsible for filling Mr. Food with customers? Does this sound difficult? It really isn’t. You see, you wouldn’t have to do all the referring yourself.
Imagine spreading the news of the wonderful Mr. Food Supermarket to five friends. If the five friends you told are not hermits, they could spread the news of the wonderful Mr. Food Supermarket to 5, 10, or even 15 of their friends. These individuals could pass the news along to their friends, etc.
It is possible, by sharing the news with just a couple of friends, that eventually, everyone in town could be contacted. That’s networking. Filling the Mr. Food Supermarket really won’t be quite as hard as you imagine.
Now, how much word-of-mouth advertising bonus do you deserve? You deserve the entire advertising budget. Of course, you would share it with your network of friends who helped you spread the news.
Can you see how receiving just two percent of an entire supermarket’s sales could be
If you haven’t thought of it already, I’m sure there is more than one supermarket in your area. There may even be a clothing store or a car dealership in your community also. The potential is mind-boggling!
Your words are as good as gold
How big are the advertising budgets of companies you presently do business with? Major corporations like Ford, Coca Cola, AT&T and other companies spend billions of dollars every year marketing their products and services.
These are just four of the hundreds of thousands of companies that advertise every day. The total amount spent on advertising is more than a trillion dollars each year. You don’t need to share in a very large percentage of a trillion dollars to live quite comfortably.
Just look around you to see all the advertising spent in your local area. It’s everywhere. For instance:
1. Billboards
2. Television
3. Satellite or Cable Television
4. Radio
5. Newspapers
6. Magazines
7. Direct Mail
But none of these advertising methods are as effective as word-of-mouth advertising. Potential customers will give far more credence to a friend’s recommendation than to a message on a $10,000 billboard.
There is power in word-of-mouth advertising that can never be bought through regular advertising channels. Smart companies are more than willing to share their advertising budgets for this powerful method of increasing business.
This lesson will be continued …
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