It is well known that Networking is a critical marketing tool in today’s competitive market. Effective networking strategies can result in a steady stream of new leads and referrals to your business. Unfortunately for many small business owners their networking experiences are nothing more than an expensive waste of time and energy.

Here are five simple steps to ensure that your networking provides a positive return on investment.

1. Know your target market

If you aren't clear on your target market and what you have to offer them then how can you expect people you meet to be able to refer potential clients to you and how can you determine where you should be directing your networking efforts. Some target markets are easier than others to connect with through dedicated networking groups. If your target market doesn't network then think about networking with other businesses who share that target market and working together to develop your client base.

2. Have a networking plan integrated with your business and marketing plan

One of the most common mistakes most new business owners make when they start networking is not having a plan for what they hope to achieve. How can you know if something has been effective if you didn't know the result you were looking for and you weren't clear on the strategies you were going to use. If you are networking because you want to generate new business (the motivation behind 80% of business networking) then you need to have a clearly defined action plan, budget and set of objectives.

3. Make sure that your networking activities fit in with your networking goals and plans.

If you have a plan and clear networking objectives it is easier to select the right networking activities to meet them. After all if your key goal is professional development then there is not much point in your joining a referral network. Similarly if your niche market is builders and plumbers then you are probably wasting your time at the local chapter of the CPA.

4. 2 ears and one mouth - it is more important to find out about the other person than talk about yourself

Most people approach networking from the perspective of marketing - tell everyone I meet about my products and services and hopefully one or more of them will either want to buy for themselves or know someone they can refer to you. But if that is why everyone is there then the outcome is obvious. Everyone is there to sell and nobody is there to buy and nobody wins. If you keep your ears open and only open your mouth to ask questions then you will go away knowing much more about the other person and how you may be able to help them - a far better start to a long term relationship.

5. Make sure that you follow through in order to achieve objectives

Follow up is the most neglected part of networking - 95% of networkers fail to follow up effectively. Think of the hundreds of business cards in your bottom drawer - how often have you connected with any of them? If you are not following up after every networking event you are leaving business on the table.

What other networking tips do you have to make sure your networking is working for you?