Gerrard Macintosh, PhD and Michael Krush, PhD
Conventional wisdom suggests that networking is beneﬁcial in sales, but surprisingly little research has examined the real impact of networking behaviors. While networking is an important source of sales prospects, research suggests networking has other potential beneﬁts aligned with sales success (Chang 2005; Üstüner & Godes 2006). Research also shows that men and women network differently and benefit differently from networking. In our research, we examine different types of networking benefits for female and male real estate professionals which allows us to offer suggestions for more effective networking.
Benefits of Networking
Beyond the obvious benefit of identifying potential clients, networks can provide additional benefits which can be classified as instrumental and expressive beneﬁts. Instrumental beneﬁts relate to work-role performance and include “information, expertise, professional advice, political access and material resources” (Ibarra 1993, p.59). Expressive beneﬁts relate to psychosocial resources, such as friendship and emotional support (Kram & Isabella 1985).
Three types of networking beneﬁts that seem particularly relevant to real estate sales are 1) access to information (how to be more effective at my job and particularly, information about sales opportunities), 2) inﬂuence (in the form of vouching, recommendations, and referrals), and 3) status.
Status is deﬁned as the perceived quality of a market alternative relative to its competitors (Podolny 1993). Status sounds a bit pretentious, but it simply means how potential clients see you relative to all the other real estate professionals available. Each prospective buyer and seller who works with a real estate professional makes a decision: with whom should I partner? Where you stand reflects your status.
Market status is determined by your “track record,” but also by with whom you associate. One’s status is enhanced by relationships with higher status others and diminished by relationships with others with lower status. Your status is influenced by the status of people with whom you are associated, including your clients, other professionals, and professional groups.
New Perspective Provided by Our Study
In our study (Macintosh & Krush 2017), we were interested in looking at the relationships between different types of networking behavior and sales performance. In particular, we wanted to see if there were differences in benefits based on gender. Networking behavior is defined as “individuals’ attempts to develop and maintain relationships with others who have the potential to assist them in their work or career” (Forret & Dougherty 2001, p. 283).
We measured three types of behavior: 1) peer networking, 2) professional networking, and 3) customer networking. Peer networks can be a valuable resource for information sharing, career strategizing, and job-related feedback that can help people work more effectively. Peers also provide friendship and social support, which can help salespeople deal with the ups and downs of selling.
Professional networks may also impact sales performance in a number of ways. Professional networks are a good source of useful non-redundant information about industry trends and best practices (Chang 2005). Professional networks provide an opportunity to meet inﬂuential people, identify business opportunities, and learn new skills (Durbin 2011). Professional associations can provide access to external mentors. Professional organizations can also enhance status both by ties to higher status individuals but also by linkage to the professional organization itself (Podolny 1993).
Customer networking is central to the sales role. Greater interaction with customers is likely to provide greater access to important information and other resources (Üstüner & Godes 2006), such as better knowledge of customers and needs, referrals and recommendations (inﬂuence), and other relational beneﬁts. In addition, having links to higher status customers should also enhance the salesperson’s status in the market (Podolny 1993).
In our study, performance was measured both objectively (total commissions) and subjectively (asking participants to rate themselves on a number of performance indicators). We then statistically examined the relationship between the different types of networking behaviors and the performance measures, both for the entire sample and for men and women separately.
For the aggregate sample, subjective performance was signiﬁcantly related to professional networking and customer networking, but not to peer networking. For objective performance, only the link from customer networking was signiﬁcant. However, when we separated the sample by gender, differences were found for men and women. Both professional networking and customer networking were significantly related to subjective performance for women and only professional networking was related to objective performance. For men, none of the forms of networking were related to subjective performance, and only customer networking was related to objective performance.
Summarizing, both professional networking and customer networking were related to higher performance. However, men benefited more from customer networking, while women benefited more from professional networking. The finding that customer networking was not related to objective performance (total commissions) for women might be a bit of a concern. An explanation suggested by the literature is that men are better at securing instrumental (job related) benefits from networking.
Networking does not happen without costs in terms of time and effort. Therefore, professionals should consider both the benefits and costs of networking and try to maximize the effectiveness of their networking efforts. Our research suggests that both individual producers and managers should be more proactive in thinking about networking efforts, both in terms of the types of networks and individuals within those networks that can provide performance enhancing benefits.
We recommend that real estate professionals consider the following questions as they allocate their most precious resource—their time:
- What benefits should I expect from my efforts?
- How can I improve the amount and quality of information I receive?
- How can I leverage my connections to get more referrals and recommendations?
- How can I improve my standing (status) in the eyes of potential clients?
In addition, our research provides strong evidence of the value of active membership in professional organizations for female real estate professionals.
Finally, for those interested in improving your understanding networking, we suggest reading Chang (2005) and Üstüner & Godes (2006), which provide a lot of practical and useful information about effective networking.
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Macintosh, Gerrard and Michael Krush (2017), “Networking Behavior and Sales Performance: Examining Potential Gender Differences,” Journal of Marketing Theory and Practice, 25(2), 160-170.
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Chang, Julia (2005), “Casting a Net,” Sales and Marketing Management, 157(7), 28–33.
Durbin, Susan (2011), “Creating Knowledge Through Networks: A Gender Perspective,” Gender, Work, and Occupations, 18(1), 90–112.
Forret, Monica L. and Thomas W. Dougherty (2001), “Correlates of Networking Behavior for Managerial and Professional Employees,” Group & Organization Management, 26(3), 283–311.
Ibarra, Herminia (1993), “Personal Networks of Women and Minorities in Management: A Conceptual Framework,” Academy of Management Review, 18(1), 56–87.
Kram, Kathy E. and Lynn A. Isabella (1985), “Mentoring Alternatives: The Role of Peer Relationships in Career Development,” Academy of Management Journal, 28(1), 110–132.
Macintosh, Gerrard and Michael Krush (2017), “Networking Behavior and Sales Performance: Examining Potential Gender Differences,” Journal of Marketing Theory and Practice, 25 (Spring), 160–170.
Podolny, Joel M. (1993), “A Status-Based Model of Market Competition,” American Journal of Sociology, 98 (January), 829–872.
Üstüner, Tuba and David B. Godes (2006), “Better Sales Networks,” Harvard Business Review, 84(7/8), 102–112.
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About the Authors
Gerrard Macintosh, PhD
Professor of Marketing, North Dakota State University
Gerrard Macintosh’s (PhD – University of Nebraska) research interests focus on interpersonal relationships and other factors impacting performance in both sales and services marketing. Dr. Macintosh’s research has been published in the International Journal of Research in Marketing, the Journal of Business Research, Psychology & Marketing, the Journal of Personal Selling and Sales Management, the Journal of Marketing Theory and Practice and several other journals. He has received several research awards from the American Marketing Association and the Journal of Personal Selling and Sales Management, and college research awards for outstanding research from both universities where he has served. He is an associate of the NDSU Center for Professional Selling and Sales Technology and teaches Personal Selling, Sales Management, and Services Marketing. Prior to his academic career, Dr. Macintosh spent twelve years in sales in the financial services and insurance industries.
Mike Krush, PhD
Associate Professor and Director of the NDSU Center for Professional Selling, North Dakota State University
Mike Krush (PhD – University of Nebraska-Lincoln) co-championed and serves as the Director of the NDSU Center for Professional Selling and Sales Technology—the only academic center dedicated to developing the sales skills of college students within the North Dakota University System. During his academic career, Dr. Krush has taught undergraduate and graduate students marketing strategy and sales at three universities. His research interests including strategic marketing issues, marketing capabilities and competencies, and personal sales and sales performance. He has published in journals including the Journal of the Academy of Marketing Science, Journal of Business Research, Journal of Business Ethics, Industrial Marketing Management, and the Journal of Personal Selling and Sales Management. Prior to his academic career, Dr. Krush served in marketing as a brand manager within a Fortune 500 company. His responsibilities included all areas of strategic marketing for a $600 million brand. In addition, he has consulted with start-up firms, conducted marketing in the financial services domain, and written a book on career preparation.