R3: Retention, Referrals and Raving Fans Handbook
The Retention, Referrals, and Raving Fans Handbook is consistently being updated. Be sure to bookmark and check back often. Comments are on for paid subscribers. Feel free to engage the field, share your feedback, and ask questions.
About:
Retention, Referrals, and Ravings Fans is an “accidental book”. I taught it about a dozen times as a live class. When I taught it, I taught it in the order it should be implemented: reverse order. Building from the back to the front is far more efficient. Naturally, many people struggled with learning something backward.
My business partner at the time, Dan G, took all the recordings of the final live class and rearranged them in an easier-to-follow format. That became the outline for the original version of this book.
It has not been through a heavy editing process and may feel disjointed in certain areas because it’s presented in an order/sequence that is different from the course material.
The R3 methodology can be implemented from this book alone, but to truly understand the concepts and principles will require supplemental material. That material is either referenced or included in the pages below. To prevent this book from getting too disjointed, fragmented, or confusing, many sections of the book have been removed and included as handouts or workbooks instead. This likely has more to do with my inability to write a long book than it is the best way to format something - but it is what it is.
One more thing to note:
I’ve included some templates, but this book is not highly tactical and that’s by design. It’s principles-based. The best tools for you to use right now depend on the tactics you’re using and the unique situation that you are in. The best tactics for you to use right now depend on the strategy you are deploying and what you’re trying to accomplish. The best strategies to use are derived from sound principles and depend on your unique disposition and priorities.
If I wrote a book about tools, it would be outdated before it reached you and you’d be up shits creek without a paddle. If you understand the core principles at play, you can develop sound strategies, tactics and tools. Something about teaching a man to fish or something.
Credit to Lukas Resheske and his Clarity Hierarchy for the framework.
Resources:
Bumpers. My book Bumpers is the foundation of everything I do. It’s a short read, and it lays a strong foundation for R3 and for you, as a business owner. I set the price as low as Amazon would let me: BumpersBook.com
The R3 Experience. The best way to learn something is to experience it. I set up a flow that will help you experience R3.
It’s super simple. Two emails and two texts sent over two days. It has the foundation (phase one) of R3 baked in and each step shows you exactly how R3 is baked in. To be honest, if you join the R3 experience and follow the steps over the following two days, it will probably have the biggest impact on your business in the shortest amount of time: ExperienceR3.com
Stealth Influence Content Marketing and Sales. Stealth Influence is touched on in the book. It’s one of the most powerful skills to learn that can amplify your marketing, content creation, sales, and relationship building. The Stealth Influence for business resources covers strategies, tactics, and tools to implement Stealth influence in your marketing, sales, and retention process. Stealth Influence is here.
Onward.
INTRODUCTION
I want to get something out of the way right here in the beginning. This book will not do anything for you. As in, it will not magically come to life and do any of the work for you. Skim it, read it all the way through, read it 108 times..it won’t matter if you don’t do anything with it.
Not only will this book not do anything for you, it also won’t make you more intelligent. To increase your intelligence, you have to learn. So, just to make sure we’re on the same page, that’s probably the best place to start.
Increasing Your Intelligence
Intelligence is a funny thing. Everyone has their own idea of what intelligence is. Street smarts? Book smarts? You don’t have to adopt my definition of intelligence but it will be helpful to understand what I mean when I say it. My working definition of Intelligence I adopted from a student of mine, Dr. Todd Snyder. It’s simple, unifying, and practical:
“Intelligence is the ability to get what you want”
If your ability to get what you want increases, you have become more intelligent. I don’t care how well you remember something or repeat something, if you haven’t increased your ability to get what you want, you haven’t gotten more intelligent.
How do you increase your ability to get what you want?
By learning.
So what is learning? My definition:
Modifying your behavior based on new information.
“Same circumstance, different behavior”
If you run into a problem and behave the way you have always behaved, you haven’t learned.
So, using my working definitions, there is only one way to increase your intelligence…
Engaging The Field.
I cover this in-depth in my book, Bumpers so I’m not going to go too deep here. (It’s the “Intention-Intervention” Gap chapter).
Engaging the Field is simple. When you get new information, test it against reality. Everything you read in this book is either:
Conceptual
Theory
Someone else’s data
All books, courses, etc are the same. Concepts, principles, strategies, and someone else’s data. Take them, engage the field, and get your data. Here’s how to get the data:
Consume
Reflect
Enagage and implement
Reflect again
Repeat
I have a free workshop on this process called “Engaging The Field”. You’ll find it in the resource hub mentioned above.
Okay, now that’s out of the way….
I’d like to make a statement…
Nothing grows revenue like retention and referrals.
Keeping customers is far more profitable - since you’ve already paid the acquisition cost and they generally become a lower headache & time commitment over time. Referrals are a magic money multiplier.
One good referrer can bring you hundreds of new customers for free.
I’ve heard countless business owners say something ridiculous like “but…but… but… I’ve tried it already” and have since given up since reality did not meet their expectations.
Speaking of reality not meeting expectations, these are generally the same people who still believe they’re one funnel away.
I Hate The Concept Of Funnels…
I’m sure you’ve heard it - maybe even said it - before…
“You’re Only One Funnel Away”
A classic example of a belief that creates an expectation that reality will likely never meet.
Here’s why:
When you build a marketing funnel, you’re building it with the expectation that it will function like the physical construct of a funnel. The physical construct of a funnel works like this:
Put a substance in the top of the funnel
The substance comes out the bottom of the funnel
Simple.
The physical construct of the funnel works because…
The substance cannot get confused, distracted, scared, or overwhelmed in the process. It just does what physics dictates it’s supposed to do.
The substance does not have to change its own behavior, which means it does not have to change its beliefs to keep moving in the direction it’s going to move. It just does what physics dictates it’s supposed to do.
The substance does what we expect it to do because of the laws of physics.
The substance doesn’t end up getting funneled to the right place because we want it to, but because we understand the laws of physics - we know exactly what the substance is going to do - and built a tool to direct it.
Back to your marketing funnel.
Can the thing you’re putting in the top of your funnel get confused, distracted, scared, or overwhelmed? Yes, because they’re human.
Does the thing have to change its own behavior or beliefs to go where you want it to? Yes, or you wouldn’t need this funnel.
Do you already understand exactly what it’s going to do? No. Because it’s human.
The problem with the mental construct of a marketing or sales funnel is that it takes a few of these things for granted. For example, the nature of the substance matters; water doesn’t get confused. People do. Water will always behave the same way under the same circumstances, people won’t.
Why did we first build a physical funnel? Because the laws of physics told us exactly what we should expect the substance to do - be pulled down to the earth.
Why do we build marketing funnels? To get the people to do something completely different than what they would otherwise be doing.
It seems nonsensical to expect them to behave the same.
The main reason a funnel functions the way we expect it to is because of this little immutable thing called…
GRAVITY.
For the mental construct of the funnel to function as expected, you would need to mimic the power of gravity (which is a pull, not a push), remove as much uncertainty and confusion as possible, and get someone to change their behavior.
Behavior is largely belief-driven, so you’d have to remove the beliefs that are preventing people from moving through the process and replace them with beliefs that better serve them. The only way it would make any sense to expect the mental construct of a funnel to function anything like the physical one, would have to have:
Gravity or a magnetic pull in the direction you want things to be funneled (try using a funnel sideways, it doesn’t work the same)
Clarity, certainty, and trust along the journey
The tools to remove and replace beliefs so the human can modify their behavior without dissonance. You can get people to change their behavior without changing their beliefs but buyer’s remorse tends to grow in lockstep with dissonance.
So…
Why Retention, Referrals, and Raving Fans?
Because there is no inherent, immutable, magnetic force pulling people into or through your system. You have to create it. (I understand if you feel otherwise, it’s totally normal. It is called: entitlement).
If you want reality to meet your expectations, you can’t expect people to come into your world and funnel through your process the way you drew it up without actively creating a gravitational force and cultivating clarity, certainty and trust.
R3 is the system to create a magnetic pull, provide clarity, instill trust, and get people to modify their behavior in a way that is beneficial to both themselves and your brand.
For a very long time.
And it takes work. That’s right. Scaling a business and building a brand is hard. It’s really hard. It takes effort. A lot of effort.
Many internet marketers will try and tell you otherwise…they’re lying to you. They’ll try and convince you that you can out-market or out-sell your way out of anything and everything. And they believe it. Most of them have to believe it because it’s the only thing they know - and they need you to believe it so they can sell it to you.
If that’s you, turn back now. This is not the book for you. Not right now, anyway. If you’re not in a place where you’re willing or able to make any changes, just put this down and come back to it later. Otherwise, read on… either way, I get it.
…But I have to tell you to do that.
One of the underpinnings of R3 is a set of three questions, with a bonus fourth:
Why am I here?
Am I in the right place?
What should I do next?
And, once you’ve mastered those three…
…And then what happens?
If you answer all of those questions at every step in the journey, you build what’s called “Allegiance Capital”, and it’s one of the most powerful components of the R3 system. We’ll circle back to it later.
Let’s focus on you.
Why are you here? Because you stumbled upon this book. I’m not sure how, but you probably own a business and would like to increase your profits. My guess is that whatever you’re doing now isn’t turning out like you expected.
Are you in the right place? If you’re still reading after the introduction and the first section, yes. You’re in the right place.
What should you do next? Read the introduction again. Time is limited, if you’re not in a place to make small changes, don’t spend it reading this - or any other - book.
If you are in a place to make a few tweaks that will increase your profits dramatically or want to kill some time while soaking in some new ideas…keep reading.
And then what happens? After each section, you’ll think you have a good grasp of it. When you go to engage the field or implement, you’ll realize there are some holes in your understanding…and you’ll feel a little frustrated. Thats okay. That’s how this whole thing works.
As you implement it, you’ll likely run into a conflict your profit will be increasing, on average over time, but you won’t be getting the dopamine rush you hoped for because - as it turns out - the same person buying more often doesn’t feel as good as a new person buying something new does.
It’s way more profitable, it just doesn’t like up our dopamine-addicted monkey mind the same.
The monkey mind places a high value on “new”. If you let the monkey mind win, you’ll be stepping over dollars to pick up pennies and fixing toilets in the middle of the night. That’s what would happen to me, anyway.
Fixing Toilets in the Middle of Night
In 2016 my first business had been open for five years. In that time we had moved locations, knocked down walls, built a waitlist, and become the highest-priced facility in town. Our waitlist was growing, our prices were going up and we had run out of walls to knock down. We had capacity but I like things to be simple and the juice didn’t seem worth the squeeze.
One day I was talking to my friend Chris who was president of Centerstate Bank at the time. Since I ran most of my money-related ideas by him, I said:
“I’d really like to make more money. I think I’m gonna buy a rental home”
He asked:
“How much do you think you will make?”
“Probably an extra $400 a month”
…and I remember how good it felt to say that.. an extra $400 a month with this new endeavor. I would be winning!
Then he asked:
“How much is a new member worth to you right now?”
Me: “On average… $500-600 a month right now”
Chris: “Okay. How much effort would it be to get one?”
Me: “Well, none. I would just let someone in from the waitlist”
Chris: “How many could you realistically let in right now from the waitlist?”
Me: “Probably 8-10”
Chris: “Okay, so what sounds like a better use of time… letting 8 people in at $500 a month each - $4,000 a month in new income…or buying a house and answering phone calls in the middle of night about broken toilets for an extra $400?”
It hit me right away.
It would take maybe two hours of work to add $4,000 a month and I’d feel like… probably nothing.
It would take a ton of work, money up front, learning a new skill, and taking on significant obligations (like broken toilets) to increase my income through a rental property.
And still, the latter seemed far more appealing because it was something new. My monkey mind would feel like it was winning. And for weeks, I let myself mistake “more appealing” for more profitable. It felt better… it felt sexier than doing more of the same.
Most business owners are stuck in the same trap, mistaking getting new clients in new ways for being more profitable than just keeping more of the ones they already have.
It’s the new trap.
You’re going to feel it. You’re going to be tempted by shiny, new, and different. And that’s okay. The monkey mind isn’t going anywhere, you can’t silence it - we simply need to recognize when it takes the wheel and overrides it.
Something stupid that feels good to feel a lot better than something smart that doesn’t feel as good.
..and why would I tell you that?
More allegiance capital.
It’s also worth noting to what degree emotion can overpower logic. You’ll want to remember that later because I’m gonna tell you that your customer’s emotions need to be addressed far more than their logic..you’ll have an emotional reaction to it and try to fight it - with logic.
If you can recognize when it happens in yourself, you’ll have a deeper insight and understanding of what your clients and customers are dealing with.
You may be thinking “Thanks for the warning, but that’s not gonna happen to me” . Maybe it won’t. In this case, no harm was done. But if it does, and you recognize it, you’ll probably think to yourself… “Damnit. How the hell did he know I would feel this before I could even conceive of or believe it?”.
And once again… more allegiance capital.
Part 1: The Foundational Pillars of R3
The Pillars. The pillars of R3 are not “marketing” things, they are human things. This book will show you how to apply them to marketing, sales, retention and referrals - but it’s important to understand that they work because your prospects and your customers are human.
Pillar 1: Allegiance:(Clarity, Certainty, and Trust)
Allegiance Capital: building trust at lightening speed
The Rocky Road
Pillar 2: Gravity (The magnetic pull)
Stealth Influence: getting people to adopt your ideas as their own
Turning innovation into information
Pillar 3: Reliability and Behavior (Building the system to manage emotions)
THE HFM: The “Holy F*ck Moment”
Monkey and Bananas: What monkeys teach us about how to deal with humans
Two Plow Horses Is Better Than One: Strategic communication of important things
I recommend taking the time to understand these concepts outside of business. It will give you the ability to derive your own strategies, tactics, and tools and apply them to situations that are unique to you.
Remember the requirements of moving people through a system: 1)Gravity or a magnetic pull, 2) Clarity, certainty, and trust, and 3)A human to modify their current behavior.
Stealth Influence is the gravity.
Allegiance capital is clarity, certainty, and trust.
Combining stealth influence and allegiance capital leads to modified beliefs and behavior.
R3 is the the system that unifies and combines them all to improve your marketing, sales, and retention leading to raving fans and significantly more referrals.
And in case you’re still stuck on it… yes, it will make your funnel work better.
PILLAR 1
Clarity, Certainty & Trust
1. Allegiance Capital
Chris Voss once told me that if you try and hug a kid who’s battered, he will flinch or run away.
Your intentions don’t matter, the logic doesn’t matter and the science behind the benefits of hugs don’t matter. What you know given your experience doesn’t matter - because the kid has baggage, he’s been beaten before. It’s unrelated to you, but he’s carrying it nonetheless.
Maybe you want the kid to hug you back for all the right reasons.
Just like you want your prospect or customer to do something, for all the right reasons. And guess what?
Your intentions don’t matter, the logic doesn’t matter and the science behind the benefits of it don't matter. What you know given your experience doesn’t matter - because everyone has baggage.
If you want the other party to behave a certain way, it’s your responsibility to be empathetic toward them and their reality. Don’t put links in front of them without context, because they’ve been scammed before. Don’t tell them that they should just trust you because the last person told them that - and the outcome was devastating for them.
The onus is on you to do better. The good is that the basics of allegiance capital are super simple.
Basic Allegiance Capital.
Remember the three questions?
Why am I here?
Am I in the right place?
What should I do next?
The answers to those questions help orient busy and distracted people and set up the ultimate allegiance capital moment, the fourth question:
…And then what?
When is the last time a business - or anyone else - told you something was going to happen and it happened exactly like they said it would? It’s rare and it erodes trust quickly. But it can quickly be flipped on its head and work to build trust - and it has nothing to do with the actual deliverable.
The main reason things rarely happen exactly as planned is because:
Humans tend to think and communicate in leaps instead of micro steps
Randomness exists and will always exist
Assumptions are made by all parties and never communicated or made explicit
It’s true we don’t live in a vacuum and many things will not turn out exactly as planned - but there are quite a few things that will. The things we take for granted and fail to communicate - like the steps leading up to the big expectation.
On a basic level, it might look like this:
You’re here because you clicked a link to learn about how to lose weight. (Why am I here)
Losing weight can be tricky, even more so as a busy mother, that’s why I put this together. (Am I in the right place?)
You can get a full overview of the program by clicking the button below (what should I do next?)
Now here’s the magic moment.
As optimistic as the person reading it may be, they have no idea what’s going to happen when they click the button. Remember…baggage.
Is it going to take them to a sales page? An opt-in? Another bait and switch?
This is where you have an opportunity to inject allegiance capital by telling them:
You’re here because you clicked a link to learn about how to lose weight. (Why am I here)
Losing weight can be tricky, even more so as a busy mother, that’s why I put this together. (Am I in the right place?)
You can get a full overview of the program by clicking the button below (what should I do next?)
It will take you to a page like this with a 12-minute and 47-second YouTube video embedded in it. (...and then what?)
See that last line? It’s one extra sentence.
When they click on it, they should be taken to a page like the previous one with a 12-minute and 47-second YouTube video embedded on it. Basic, right? But something special has happened:
You told them what to do and what would happen if they did
You told them exactly what would happen if they did it
They did it
It happened exactly the way you told them it would happen
Subconsciously, they’ve learned that what you say will happen, happens. You’ve built trust faster than any brand ever has by simply making an assumption explicit or knowing ahead of time.
It may seem insignificant, but if you make this your default operating system, people learn they can trust you. While everyone else is trying to manage emotions to deliver on one big promise, you’re delivering on thousands and thousands of micro promises.
Each time you tell them to do something and what will happen - then they do it and happens exactly that way - you’re depositing into the trust account. Those microdeposits buy you a buffer for when randomness inevitably rocks the boat. One tiny step at a time…
You’re building Allegiance Capital.
That’s the basic version of Allegiance Capital. From now on answer those three questions and the bonus fourth if you can…as many times as possible. Truth be told, you could do that and only that for years and get a massive return on your time reading this. Watch the Allegiance Capital training for free here.
Intermediate Allegiance Capital
Intermediate Allegiance Capital is an extension of basic and over time, it might be the most profitable skill you ever learn…
Want The Full Retention, Referral and Raving Fan System?
Get the Full R3 System at experiencer3.com/book
….Or experience it for free at experiencer3.com
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