The NetWorking Industry

As summer officially ended Saturday, September 23^rd, I couldn’t help but notice many of my clients and associates eager to put the past few months behind them as the fall season kicks off.  This summer for many business owners was a challenge (hopefully yours was better) with surging gas and oil prices coupled with a flat real estate market in most parts of our country not to mention the ever-continuing troubles in the Middle East, the five year anniversary of 9/11 and the typical slow-down of Summer due to vacations.

As the kids are going back to school and the days are getting cooler (at least, here in the Philadelphia suburbs), the fall season this year seems to bring an exceptionally new resurgence of optimism on the NetWorking front.  NetWorks like Chambers, Associations and Societies are running their Expos and increasing their programming.  Service-oriented businesses are looking to ramp up sales to make their year-end projections and retailers are gearing up for the holiday season.  Interestingly to me, new NetWorks are continuing to form, vying for increased membership, your consideration, your commitment and your dollars.

The NetWorking Explosion

Since 2000, I have championed the idea that NetWorking is an industry.  Over the years (you may have noticed it too) that there are more NetWorking opportunities than there were just a few years ago.  My wife, Wendy, and I research and catalogue the ever-increasing number of NetWorks out there...an almost seemingly mountainous task as, like people, NetWorks are born and die every day.  But whether NetWorks are brick and mortar or click and mortar or some combination thereof, it’s often fascinating, scary and confusing at the same time, especially as a business owner that uses NetWorking as part of their marketing strategy.

I find that it’s useful to step outside of the chaos from time to time to look at the bigger picture to understand some basic concepts and gain a better perspective.

NetWorking as a Commodity

It’s important to understand that NetWorking has been around since time eternal, I believe that NetWorking, like the PC/Internet revolution of the last decade or the San Francisco gold rush of 1849, is experiencing its own growth phase.  Although NetWorking has been in existence for so long, we as a society have until recently realized that NetWorking is a commodity.  A commodity is defined as a generic, largely unprocessed, good that can be processed and resold¹.  The key here is that as long as the human race exists, NetWorking is not going away.  Some enterprising individuals have made this connection and have made it their business to capitalize on this.

First to Market

Just like with any endeavor, being first to market isn’t always a recipe for success.  Take, for example one of the earliest strong-contact (also known as “exclusive” or “closed”) organizations Ali Lassen’s Leads Club International, founded in 1978.  Today it has over 300 chapters in the U.S. and Australia.  Founded the same year by Ken Peterson, LeTip International has over 450 chapters in the U.S. and Canada.  Seven years later in 1985, Dr. Ivan Misner founded Business Network Int’l. (BNI) which now boasts over 4500 chapters in over 30 countries and has become more of a “household” name in many parts of the country, when it comes to NetWorking.  It should be noted here that while the numbers may indicate a form of success each of these organizations should be taken on a chapter by chapter basis – there are highly-successful chapters in each organization just as there are others that are less than effective.  It would also be telling to know the percent of members of each that re-up.

The Internet’s Influence

Robert Metcalfe, founder of 3Com Corporation and pioneer of the Ethernet (computer networking standard) developed a principal called Metcalfe’s Law, which states that any technology is only as useful as the square of the number of people who use it.  In layman’s terms, it states that the more people who use a product or service, the more valuable it becomes and the more it attracts more people once a particular threshold of users is crossed.  This idea is said by many to have spawned billions of dollars in investment in the Internet.

Type in the word “network” or “networking” on your favorite search engine.  Do you see any results for business or social NetWorking?  Didn’t think so...it’s mostly about computer-based networking (yes “networking” as opposed to “NetWorking”).  What I find most interesting is that one of the main reasons that business and/or social NetWorking has become so popular is due to the Internet boom of the ‘90s.  What can be done now is to accelerate global community growth where it would not have been feasible before.

Again, organizations like the ones mentioned above as well as relative newcomers like eCademy, Ryze, LinkedIn and MySpace have spawned a frenzy of folks looking to get connected (not to mention other online NetWorks vying for marketshare).  It’s taken a bricks and mortar NetWork like BNI to grow to approximately 84,000 members in 21 years whereas online NetWorks like eCademy (70,000 members), Ryze (450,000 members), LinkedIn (7 million members) and MySpace (over 106 million members) have come close, if not surpassed that.  Couple this with the fact that none of these clicks and mortar NetWorks existed before 2001 and you can see the evidence for yourself.²  It’s important to note here that the online NetWorks typically have elements of them that are accessed for free.  With this being the case, it’s difficult to tell how many of the users actually use them regularly.

Saturation?

So with the never-ending proliferation of NetWorks available, is it possible to get saturated?  I am of the opinion that with traditional NetWorks this is more of an issue, due to their non-virtual environment...free is just not realistic unless larger companies sponsor such events or sites.  With the number of small businesses on the rise in the U.S., the continued NetWorking renaissance will continue for some time as word-of-mouth (NetWorking) is the least-expensive form of promotion.  I do predict a time, however, when the NetWorking baby will have grown, moved out of the nest and into the adult stages of its life as an industry.

So What’s Next?

If we look at history as a predictor of the future, then when we can project that when the NetWorking honeymoon is over, just like with any other industry, the cream will rise to the top and the industry will become dominated by a handful of the most competent.  Which NetWorks will still be relevant is anyone’s guess, but it is not beyond belief that we might even see mergers and acquisitions like in the banking industry.

Until then, enjoy the ride and as always...

Happy NetWorking!

References

1. commodity. Dictionary.com. Wall Street Words, Houghton Mifflin Company. http://dictionary.reference.com/browse/commodity (accessed: September 28, 2006).
2. WikiPedia.  http://www.wikipedia.org

Please contact Adam at Adam@TheNationalNetworker.com.

Sign up for our newsleter;
Email a friend.

Go to: Site Map