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Posted: September 01, 2011

State of the state: Marketing

Leads Groups: Connecting
the Old-Fashioned Way

When he retired four years ago after 35 years as a chiropractor, Richard Garde went into another line of work, representing a line of anti-aging nutritional products. He immediately dipped his toes into the networking waters.

"The mentality was like a shark tank," Garde says. "It was all about me, me, me. I didn't like that. It was like pulling teeth for me to attend a meeting."
Then he discovered leads groups. He found people who were committed to the success of everybody in the group.

"Now the concept of networking is being a connector," says Garde, a member of the Thornton/Northglenn chapter of Colorado Business Leads. "It takes stress off while building relationships."

What better way to build business than to rely on people you trust, and who trust you, to spread your message? It's viral marketing the old-fashioned way; through personal relationships.

Leads groups allow just one representative of each profession to belong. Members use each others' services and refer friends and family to group members. The Denver area alone has an estimated 200 leads groups.

They're not free, but they're not outrageously expensive either. To join a Colorado chapter of Business Network International, the state's largest such group, costs $465 for the first year - a one-time $100 registration fee and a $365 annual fee. Another major player, Colorado Business Leads, with 12 chapters, charges $275 annually.

"Networking in general is gaining more acceptance," says Mark Hiatt, who brought Business Leads of America (doing business as Colorado Business Leads) to Colorado 10 years ago and now owns 12 chapters with 140 members. "Where else can you realize maybe $50,000 from a small investment? Even if you only make $5,000, that's still a pretty good return on investment."

"A person who joins one of our groups - say it has 30 members - in essence is paying each member $15 a year," says Brad Leppla, one of four co-owners of BNI of Colorado, which has 58 chapters and 1,600 members. "That's a little more than a dollar a month to have them market their services for a full year."

Cost-effective marketing is huge in these gloomy economic times.

"People are hanging on by their fingernails and need business," Leppla says.

Membership in a group can have a major impact on your business. Take Ann Taddeo, managing broker of Brighton-based American Dream Realty, who got a referral from a former member of her Northglenn/ Thornton CBL group.

"That's business I wouldn't have gotten if I hadn't been in the group," Taddeo says. "I've gotten at least four or five transactions from him over the last two years."

This same client knew somebody who knew somebody who asked her to help him with the purchase of a $700,000 piece of land near the Denver Country Club. She wrote a contract and got a nice commission.

A few other success stories:

Kay Stolzenbach, a member of the Ali Lassen Leads Club in Southglenn, owns Kellogg Executive Suites in Littleton, leasing office space and offering virtual office services. "I have clients who've leased with me for two years at $10,000 a year, and they've stayed with me because I was referred to them by a member of the club," she says. She's gained three virtual office clients in the last year through the club.

Joe Lutz, a CPA specializing in small businesses, has gained 27 new clients in the last year through his CBL group, and the group has gotten him $20,000 to $30,000 in business in the last two years.

Another facet of leads groups has nothing to do with leads, but it's critical to the success of leads groups.

"We learn from each other," says Jo-Ann Moore, a business relations officer for the Air Academy Federal Credit Union and a member of the 20 Mile Leads Group in Parker. "If you're having trouble with your business, you have 17 other people you can bring your situation to who'll help you."
- Phil Smith

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