Why set a revenue target on business networking activity?

This article is part of the series 28 Business Networking Strategies.

Business networking is no different to any other form of marketing activity. To succeed you have to know the following...

• The benefits of your product or service
• Who you're selling to
• Where to find the type of client you're looking for
• How much to charge
• How much you need to earn to make a profit (i.e. a revenue target)

This last point is often overlooked as business networking is a social process, and we don't tend to require a financial return on investment on our social activity. Even when a person is aware of this fact, it's still difficult to look at networking in the same way as advertising, promotion or web marketing.

Despite this, business networking is a marketing activity and it makes sense to demand a return on...

• The time it takes
• The money it costs

For example, a person who charges £125 per hour and invests 4 hours a week in business networking ought to demand a return of £600 a week from his/her networking activity.

If s/he doesn't achieve this revenue target there is an opportunity cost to the business. In other words, his/her time would be better invested in marketing activity that does return £600 a week for the same financial and personal cost.

Some people may find this approach to business networking to be too clinical for their tastes. I think this stems from the natural human tendency to value social activity differently. Business networking crosses the boundary between business and pleasure, and I think this can muddy the water.

In this article, I'm treating business networking as a revenue-generating activity. If you accept the view that networking is primarily a revenue-generating activity, I recommend you also set a revenue target.

In addition to an hourly rate, a business also needs to consider the cost of networking. These costs may include...

• Membership fees
• Cost of meals
• Transport
• Training and/or training material

For example, imagine a person who charges £125 an hour and invests 20 hours a month attending business networking events. S/he pays £120 a month in fees and other costs. This person would need to earn £2,620 a month from business networking.

You may like to take this one-step further and require an additional return on investment. For example, a person investing £2,620 a month in business networking may demand a 50% return on investment. Such a person would need to earn £3,930 a month from his/her networking activity.

Compiled by Wayne Davies – creator of the DIY SEO Seminar.