Summary
- Referrals vs. Advertising: Referrals (word-of-mouth) are more powerful than ads because they involve a transference of trust from a loved one, whereas advertising is simply the business talking at the consumer.
- Targeting Early Adopters: Success starts by marketing to “Early Adopters” (those open to new ideas). The goal is to give them a great experience so they eventually lead the “Mainstream” to your practice.
- The Network Effect: A positive network effect means the experience gets better as more people join. You must avoid negative network effects (where more people make the experience worse, like a crowded surf spot) and gimmicks (like family plans with arbitrary rules).
- Natural Law vs. Hacks: Real growth follows natural laws (like flowers attracting bees). “Hacking” referrals with social pressure or forced rules often backfires.
- Permission Assets: These are one-on-one tools (emails, videos, etc.) used to build trust by giving potential patients a “glimpse” of their desired feelings before they commit to a large investment.
- Shared Activities: To bridge the gap between a patient’s current feeling (pain/demoralization) and their desired feeling (confidence), practices should create activities where groups can move toward that “promised land” together.
- Cultivating Culture: Leadership is about bringing people with similar beliefs together into a culture. When a culture is established, the “behavior” of using your services becomes a natural norm for the group.
- The Failure of “Bribes”: Many referral programs (raffles/giveaways) rely on social pressure. People often participate just to “appease” the staff rather than because they value the prize or the service.
- The Test of Value: Studies show people often prefer a guaranteed small reward ($10) over a high-value raffle entry ($200), proving that most “forced” referral incentives don’t actually motivate genuine word-of-mouth.
As you probably know, referrals by far are the most powerful methods of spreading awareness about your practice. Someone who comes in referred from a—and I’m not talking about referrals from other offices here. I’m talking about referrals like word of mouth, like people who come in who become aware of you because of a friend, family, or a loved one. Versus someone who becomes aware of you because of an advertisement you ran, right? In the advertisement, it’s you talking at them. In the word of mouth, in the referral, it’s a transference of trust through the family, friend, or loved one. So, referrals, we understand that they’re very valuable, but we’re very unfamiliar or we’re very confused about how to actually create referrals.
So, how does this look? Well, first it starts off with the early adopters. And if you don’t understand this curve, check out our course, our strategy course below. But the idea is that when we start creating a marketing system to affect people, it helps to know, it helps to realize that audience behavior can be broken down into a normal distribution similar to physical attributes. Psychology is also normally distributed and the behavior of adoption follows as a standard deviation. We’re going to call this the early adopters—a standard deviation away from the average—and a standard deviation away from the average here we’re going to call the late adopters.
So the early adopters are going to be the ones that we create our marketing for. We attract them in, we give them a great experience, and through that, we hope that they will bring in the mainstream. Now the trap here, the error, is to think that the early adopters will go out of their way to selflessly evangelize and tell the mainstream about your practice. That’s not what happens. There’s so many reasons that people don’t share things that we have to make sure that we create a positive network effect. If we don’t create a positive network effect, what happens is people won’t share the idea of you, what you stand for, the things you believe. That doesn’t get disseminated if we don’t create a network effect.
So, how do we get the early adopters to drag in the mainstream and bring them to you? And we might think, okay, we have to create a network effect around our practice. If you pause to Google what this was, network effect basically just means the more people the better. A negative network effect would mean the more people the worse it gets. So, for example, let’s say a surfer finds a very good surf spot, right? He’s an early adopter. He went out of his way. He’s dissatisfied with his current surfing situation. So, he’s always looking for a better surf spot. He finally finds one. Is he going to selflessly go out and start sharing that with all the other mainstream—the people who aren’t part of the diehard surf group, the people who just come to be traffic for all the other surfers? No, he’s not. He’s going to keep this a closely guarded secret. So that’s just an example of someone who enjoys something yet won’t go out of his way to share it because it has a negative network effect.
Another example might be like traffic. The more people there are, the worse it gets. And also early adopters—it doesn’t have to just be a network effect. If something is taboo and it would hurt their status to share, they’re not going to share it either. So, we have to be cognizant about these. But primarily, we want to work with the network effect. And the idea is not to create a network effect around your practice. We’re not trying to create a situation where the more people that come into your practice, the better it gets.
A common example of people who try to hack into it like that is a family plan. So, the more people who come into your family plan, the cheaper things get for everyone. That is not a true network effect. That’s a gimmick. You’re setting up arbitrary rules to benefit when more people come. It’s not a natural law. Network effects exist in nature. The number of flowers that exist in a group together attracts more bees. When more bees come, you get more flowers. It’s the perpetuating loop. So that’s an example of natural network effects. If we try to hack it, it’s actually going to backfire on you. It won’t work the way that you hope it will.
So how do we create a natural network effect? And turns out again the approach is a bit complex. So, if you looked at my video on elegant solutions, we want a solution that is simple, efficient, and effective. Turns out the most efficient and effective solution isn’t completely simple, which is how it’s supposed to be. We think simply, we should just bring the network effect into our office. But turns out that makes things inefficient and ineffective. So, what is the little bit more complex method of doing this? We create a shared activity. Yeah, you’re going to have to do things a little bit differently if you want to get a little bit different results.
So, shared activity, what is this? If you looked at my previous video, I made a video on the topic of our current feelings versus the desired feelings. So, how we currently feel versus where we want to go. A patient coming into your office is going to have to make several decisions. And each decision, the bigger and bigger they get, the more trust is going to be required of you. So for example, let’s say they’re about to go in and get a full-mouth rehabilitation. It requires massive amounts of trust. It’s a huge investment. So how can we bridge the gap between a consultation and this massive trust that has to be built? And the idea is to leverage shared activities and permission assets.
Permission assets is another idea—check it out if you haven’t seen that before. A shared activity is a permission asset is how we engage one-on-one with someone. We receive permission from them to give them tastes of their desired feeling. So let’s say this is their current feeling. This is how they currently feel. Maybe self-conscious, maybe in pain, maybe just demoralized. And we want to get them to their desired feeling. And maybe it’s not just feeling confident. Maybe what they want to feel is they want to feel confident about a solution to their current situation, to their teeth or whatever it is.
So we ultimately bridge this gap by providing the treatment. But before we can do this, especially if it requires such a big investment, one of the ways is permission assets where on a one-to-one basis by email, video, or whatever, we can give them glimpses of this desired feeling—of how we can provide it—a bit more clarity, a bit more confidence. And then a shared activity is just how a group of people in a network effect can do that together. So people in your early adopters, when they come in, how can we offer them a shared activity? A shared activity that together they get more of their desired feeling.
Even post-treatment, like people think of cosmetics. People come in wanting to look better. They’re always going to be having this current feeling. And later on you’ll get to realize status, culture, all these things are insatiable desires that we can play around. So they have a current feeling and they want to feel a different way about themselves, maybe more youthful, maybe healthier. And maybe for that reason they’re coming to get cosmetics. So, we can create a shared activity around that. We can say, “Hey, every week or so we’re going to get together and do some yoga” or online maybe we’re going to share some tips. It doesn’t have to look like a certain way for anyone, but the idea is we want to start cultivating a culture.
The leaders of tomorrow are going to be the people who have integrated people with similar beliefs and similar mindsets and created a culture for these people to thrive and to get to their desired feelings together. I don’t care if you’re a dentist. I don’t care if you’re a marketer, if you’re a librarian. The leader’s job is to bring those people together and help them get to the promised land, right? That’s our new way of leadership and creating these things. So when people subscribe to that and they join your little group of people—I wanted to avoid saying cult—if they join your little group of people, then now with the shared activity that we create with the network effect in mind, this shared activity should have the network effect. Again, check out the course if you want a concrete idea of how to create this.
But now they’re going to the promised land, right? And what they’re going to now say is, “Hey, we’re doing this, you need to join us.” First of all, it helps them to say this, and also in the course I show you how to break down or create status structures around the event so that people who engage with it gain status—all these different factors to join the movement. And that’s what we’re going to create. We’re going to create a culture of early adopters who gradually bring in the mainstream. They bring the mainstream into this group that exists with a lot of early adopters.
And how does this get to referrals? Why are we doing all this? Well, because what happens in a culture, what happens in any group of people, is people do things similarly. So we have now a group of people who’ve all subscribed to what you believe, the things that you do, including your services and products. We’ve created a group of people who have the behavior of going to your office. And so when the mainstream comes in, what does the natural thing to do become when it comes to dental care? It becomes to believe what you believe about—or what they believe about—dental care that you’ve trained them to believe, and those ideas get disseminated into the mainstream. The behaviors about how often to get a checkup, who to get a checkup from—all these things transfer over in the culture, not just because we put some stickers up on our wall or made a $50 prize to give out or give out some trinket that they necessarily don’t care for.
So all this together, like a good example was a lot of people will sign up to referrals like little giveaways and stuff not because they genuinely want to refer. Sometimes they hope they don’t win. What they’re actually trying to do is just appease you because in that moment there is staff members, there’s doctors who are putting social pressure on them. And guess what? It’s not a pleasant feeling. It’s a feeling that causes appeasement, right? And we don’t appease things that we enjoy. We will eagerly do stuff if we actually enjoyed it.
So maybe try this experiment. Maybe try out, let’s say you’re giving away a $200 raffle entry ticket, right? So you might think, hey, people value this a lot, that’s why they’re signing up. And this was actually from a focus group test in a different study. What they would do is they’d say, “Okay, we’re going to offer this to you at a discount. Now, you can buy this $200 thing for just $100, or you can walk away right now with this $10 gift card.” And people all chose the $10 gift card. So, you can really see how much value you actually had. Is it truly something that people want to refer? Are they signing up to your referral stuff because they want to or is it because of the social pressure? That’s a very valuable question for us to know as marketers so that we can create something that people actually value. Turns out that’s never the case. People don’t go out of their way because of this force, right? There’s too many unknowns.
All right, so hopefully that makes sense. There were a lot of ideas in this one. There were the ideas of an elegant solution, ideas of early adopters, mainstreams, late adopters. There’s the idea of current feelings, desired feelings, network effects, shared activities, culture—right? This is a big one. But this is the level of empathetic thinking and awareness that we need today to really thrive as not just marketing, but as a dental practice, as a marketing agency or whatever. So, I hope this video was helpful. I hope it gave you a lot of insights into how to create referrals for your office. What I would recommend you do is check out the course so that you can implement this stuff. I don’t care how much you know. If you aren’t implementing it and creating it for yourself, you’re not going to be helping anyone. And if we’re not helping anyone, we’re not really creating any change, are we? So, thanks for watching. I’ll see you guys later.