"Pumpkin Method." How to grow ideal customers and weed out the bad ones

We are sharing with you a sammari (a brief summary of ideas) on Mike Mikalovits’s book, Pumpkin Method. How to become a leader in your niche without a budget. ” The original book is called The Pumpkin Plan. A Simple Strategy to Grow a Remarkable Business in Any Field. " The translator decided to insert the phrase “without a budget” in the title, recalling the author’s previous book (“Startup without a budget”). But still, the translated name is misleading. A book about something else.
We recommend reading to those who are bogged down in work on their own business, who chase after each new order, who are tired of bad customers, and everyone who wants to make their business outstanding. Perhaps we have something to learn from farmers who grow giant pumpkins.

So…

What awaits you without the pumpkin method

Mike Mikalowitz knows this from his own experience. He created the successful company Olmec, however, in his words, he was a “crazy slave of his business” - he worked almost all the time, slept little and did not devote enough time to his family. Mike suffered from a common “if only” illness. He believed that if he only found another major customer or order, the situation would change for the better. But that never happened.

Mike Mikalowitz was not alone in his problems. Many of those who start their own business are subject to the illusion that when they stop working "for uncle", they will begin a free life. However, in reality, starting and creating your own business turns out to be a much more complicated, routine and tedious job. Even when Mike’s company reached the millionth level, the routine did not decrease. Mike and his companion continued to be worn like mad. After two years of such a life, the author realized that he had faded and it was time to change something. He hired a personal coach who said that until Mike stopped doing all the work himself, until he learned how to conceptualize a business, he did not have the right to be called an entrepreneur. He advised Mike to cut the list of customers, choosing only those that bring the maximum income:

“Sort customers by income. Then choose the ten customers who pay the most and divide them into two categories: good customers and everyone else - from just boring customers to those that annoy you so much that you shrink in horror when they call you. Leave the best customers who pay the most and take the rest. All to one. "

At first, this idea provoked internal resistance - the author was used to chasing every client, being afraid to miss the order. But over time, he realized the correctness of the new approach, making sure of its success in practice.

Giant Pumpkin Growing Principles for Business

One day, Mike Mikalowitz saw in a newspaper a note about a farmer who raised a giant pumpkin, breaking the previous record.

The article listed the principles of growing a giant pumpkin:

1. First you need to plant promising seeds;
2. Water them and take care of them, removing diseased or damaged shoots;
3. Weed constantly, leaving no weeds,
4. When the pumpkins grow, remove all the unlikely, leaving the strongest;
5. Then leave only one of the best pumpkin, which is looked after around the clock like a child, guard it and watch it grow.

Mike realized that these same principles are ideal for building a super-successful business:

“ Step one. Identify and use your strongest natural strengths.

Step Two Sell, sell, sell.

Step Three As your business grows, remove all small, “rotten” customers.

Step Four Never let anyone or anything distract you. Let it sometimes seem like “new opportunities” - be firm: eliminate them immediately.

Step Five Identify your best customers and remove the rest, which are not very promising.

Step Six Focus on the best customers. “Fertilize” and protect them, find out what they want the most, and if it goes with what you best know how to do, give them that. Then repeat the same thing — a service or product — for as many good customers as possible.

Seventh step. Watch your company grow to gigantic proportions . ”

Understanding of how to act came to him, Mike Mikalovits describes as insight. He began to work according to these principles, which he combined under the name “pumpkin method”. He stopped scattering and wasting energy on trifles and finally realized that the constant running around for new customers prevents him from concentrating on the best customers who bring the greatest income and which are most profitable to deal with. Applying the principles of growing giant pumpkins in his business, he immediately felt a positive effect. He sold his second company built using the pumpkin method for millions of dollars to Fortune 500 companies.

What Mike Mikalovits advises to those who start their business:

1. Ask yourself why you opened such a business and not another? What motivates you the most? The answer will be your guiding light in difficult times.
2. Determine the level of income you want to achieve this year. How much do you personally need, how much does your company need?
3. Formulate the questions correctly.

“We can only find the best answers if we ask the right questions. Instead of asking, “Why am I struggling to make ends meet?”, Ask: “How do I bring home two thousand dollars every day?” Somehow your brain will find the answer . ”

Start. How to find the best seed

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The pumpkin method begins with finding the most promising seed. It is worth it to spend time, strength and energy.

For an entrepreneur, the most promising seed is the area of ​​intersection of the interests of the best customers and the best part of the business.

“This is the place where your beloved customers can get the most out of the systematic core process that your business is based on.”

If you are just starting a business and you do not have customers yet, you just need to imagine who will be the best customers. As Mike Mikalowitz notes, your best customers are like you. They share your interests, principles and values.

How to define your main business process?

“This is not just about a product or service - it's about your approach to delivering a product or service, and about special talents, and about the abilities and experience that you can offer. This is your Big Idea, your know-how and your mojo mixed into one crazy cocktail that cannot be repeated. ”

To create your own unique proposal requires what the author calls the field of innovation (OI) - a unique combination of quality, price and convenience. Your skate can be either quality, or price, or convenience. You need to choose one thing. Otherwise, you will confuse customers. But OI is only one side of your unique offer.

The second is what you do best, your natural disposition. This is something that you do not even consider work, what you do with pleasure. The essence of the unique proposal is to combine your OI with your strongest side and with your experience.

In order to find your most promising seed, you also need the ability to sketch out your business, which will be needed when it starts to grow.

“Schematization is something that will allow you to leave the business for four weeks and go on vacation, knowing that everything will work just fine without you. And if you do everything right, your business can even grow during your absence. ”

Thus, to find your most promising seed, you need to consider three elements:

1. Your best customers.
2. Your unique offer is a combination of OI, your greatest strength and your experience.
3. Schematization - Organize your work so that it is easy to repeat.

The combination of these three elements is your gold mine, your super-seed. But it is important to remember that without taking into account at least one component your business will not take off.

Do not be afraid to "kill"

It's time to abandon the pursuit of quantity, which leads only to stress.

“More does not mean better. Better is better. ”

Bad customers make it difficult for you to serve the best customers. And your best customers should feel like VIP clients. As Mike Mikalowitz notes, no customers are better at all than bad ones. So at least you will have time to look for good customers, and not adapt to bad ones.

How to identify the best? The author advises:

• make a list of customers in descending order of profit;
• cross out the most unpleasant;
• create a column for each of the following characteristics and give a rating from 1 (very bad) to 5 (ideal) for each client according to the following parameters:

1. How fast pays?
2. Sometimes you get something or constantly?
3. Can we expect significant income from him in the future?
4. How well communicates with you?
5. Does it forgive for mistakes, does it make it possible to fix it?

Additionally, create new columns for less important characteristics, for example (you can add your own):

1. Does working with it provide new opportunities?
2. Does it recommend you to others, is it ready to do it?

Evaluate the answers “+” or “-” and use them as an additional factor in favor or against the client.

If you have hundreds of customers, start with a few percent of the best.

Define your immutable rules - the principles by which you live and work. It is important to work with those customers who adhere to the same immutable rules, and get rid of those who do not share them. Immutable rules are a guideline. If you break your immutable rules for the sake of someone, then you lose your guiding line, go against yourself, and this always leads to failure.

How to fire a client:

• Remove the service that he uses or stop serving companies of the type to which he belongs.
• Priority should be given to the best customers.
• Raise prices to such a level that they become inaccessible to this client.
• To tell an objectionable customer that an important customer is against his service.

Start by firing the most annoying customer and pay attention to how much time you have freed up.

You need to get rid not only of rotten customers, but also of those who simply do not suit you, even if they are very cute and pleasant. Weed customers continuously.

Harness Technique

In the words of Mike Mikalovits, " money is the blood of your business ." As long as you serve bad customers, you lose blood. It is necessary to stop the bleeding, which is what the tourniquet technique is aimed at.

“Just remember that the harness technique is a method of reducing or eliminating the costs associated with customers who have received the lowest ratings on your scorecard; these are sick pumpkins that you will immediately remove. They do not just annoy and absorb time - they suck blood. You have a whole bunch of expenses associated with satisfying the desires of your worst customers. Therefore, until you bleed, apply a tourniquet.

Look at all your expenses - from employees to office supplies - and cross out everything related to your terminally ill clients. ”

After you dismiss the bad customers, you need to get rid of the costs associated with them, for example, expensive equipment or employees who helped to service them. Evaluate your expenses - do they help serve the best customers, and how to make sure that they are aimed at achieving this goal?

Create your ideal block diagram - an organization aimed at serving the best customers.

“Now start assigning the right people to the right places so that they can properly serve the right customers. Do it and your pumpkin will be the largest in the city. ”

How to serve pumpkin customers

The next task is to make your key customers so happy that they never leave you.

To do this, you need to choose among your customers favorites and provide them with a unique quality service. Do not ignore the rest, but focus on the special service of the best, anticipate their expectations.

Be guided by the principle "The buyer is not always right, but the right buyer is always right . "

Promise less, give more. This applies to the time of execution of orders (if you say that you will do it by next Thursday, do it by Wednesday), to the amounts of invoices (invoice less than the amount originally announced), to quality (add trifles pleasant to the client to the order).

“Managing and exceeding expectations is the formula of super-happy customers staying with you for life. This is another big bright feather on your hat. ”

Do not be afraid to share your secrets (naturally, not those that are in the hands of competitors). What is the point of keeping secrets in a century when anyone can find information of interest to him on the Internet. The main problem now is not the lack of the necessary information, but the lack of time even to search for it. When you share your experience, they will learn about you and you will create and strengthen the image of a professional.

How can customers help you?

Do the polls right

One of the important principles of the pumpkin method is to compete with competitors in their main areas, but completely eliminate them in one area. Solve one key problem or be faster than others. This will help the customer wish list, which is created on the basis of surveys.

Your questions should concern the industry as a whole, and not your company. Ask about customer problems and difficulties. The meaning of your questions is not to promise customers a solution to their problems, but to find out what interests them, to understand them.

Examples of correct questions from Mike Mikailovitsa:

• “What do you dislike most about your industry?” In your customers? Other sellers? ”
• “If you could easily do this, what would you change in your industry? In your customers? Other sellers? ”
• “What is causing you the greatest difficulties right now?”
• “If you could adjust the products or services provided by my industry to better suit your needs, what would you change?”

The human brain is designed to always look for answers to questions. To get the right answers, you need to ask the right questions.

After you have received lists of their wishes from customers, you need to understand whether it is worth implementing what they offer. And the best way to do this is to ask your customers for advice. This will not seem intrusive and will also help customers feel like experts.

“You will not have the opportunity or desire to carry out each item on your client’s wish list. This is in the order of things. Actually, this is even more than normal, because you need to be the best in the world on only one point in order for customers to flow to you. Your goal is to work within your gold mine, and not outside your comfort zone. Not every good business idea is a great idea for your business . ”

Use an insider strategy

Mike Mikalowitz offers a special way to ensure that your product is in demand on the market. It is an insider strategy. This strategy allows you to evaluate the reaction of the client at each stage. It consists in creating a community of customers who will influence the development, launch and promotion of your product. The author calls this the process of co-creation.

The advantages of this approach are in saving money, in fast promotion and in building brand trust.

To implement an insider strategy, the author advises to adhere to the following order of work:

1. Predict. Ask potential customers if they would be interested in your offer;
2. Thank people for their interest;
3. Notify about the start of work after the polls you realized that the product is interesting;
4. Involve people in the product development process;
5. Use crowdfunding. Ask for an initial investment;
6. Do not make the product available to everyone. Limit the right to buy it;
7. Let's get more than buyers expect. They will be disappointed if they receive only what they expect;
8. Watch for feedback.

Narrow niche, broad prospects

Doing everything in a row is a losing strategy. The pumpkin method involves leadership in a narrow niche.

Two steps to narrowing a niche:

1. Apply the 80/20 rule.
2. Determine which customers (20 percent of the best) generate the most revenue, in which industry they work.

Think about how you can become more visible to companies in this industry, how can you improve your offer and their service? Who will be your competitors if you serve only companies from this industry?

“How would you describe what you are doing if you focus solely on this narrow group?”

Choose the right sellers

To provide the customer with an even higher level of service, Mike Mikalovits advises using the following tactics. Call several of the best customers, find out from them which of the sellers they trust. Then meet at least one of these sellers and invite him to join a team in order to better serve the common customer.

“The result of all such meetings will be that you need to ask sellers to recommend you to their best customers, but for now, just help each other hit your common customer.”

After you narrowed your niche, make a list of places where existing and potential customers appear, regularly visit them, being in front of customers.

Schematization. Write down all the details, print it and hang it on the wall!

Mike Mikalovits used to adhere to the position that you need to hire outstanding professionals and give them the freedom to work as they see fit. But often it turned out that he himself had to carry out their work, as people with great experience were not flexible enough. Mike Mikalowitz became convinced that a different approach works better - business schematization.

It consists in creating simple and perfectly understandable schemes for completing tasks, like safety instructions on airplanes, which anyone can understand. Then there will be no problems with the replacement of the employee, anyone can duplicate his work. The creation of such schemes is rather tedious and laborious work, which will not bring success in the short term, but in the long term the benefits will be enormous.

Mike Mikalowitz shares three questions that help his employees think independently and find the best solutions in accordance with the interests of the company:

1. Will this solution serve our best customers better?
2. Will this decision improve or support our OI?
3. Will this decision increase or maintain our profitability ?.

How to get rid of competitors: kill a curve

Mike Mikalowitz is convinced that the supply-demand curve reflects supply-based demand — it’s “not what people want; this is the best option for them among what is offered. ” Over time, not demand falls, it is consumers who respond to new offers.

Therefore, the author advises “to stop worrying about where you are on the“ product-market ”curve. You need to create something so new that the curve just becomes obsolete. You need to kill the curve . ”

The best way to do this is to use the 180 degree method:

Think about what is accepted in your industry and among your competitors (behavior, patterns, policies), and then do the opposite, new and unexpected.

“Remember that if you turn everything 180 degrees, then it must be something real and within your gold mine. Otherwise, you simply draw in front of the cameras. ”

Pay attention to customer complaints and suggestions. What will help you to get ahead and create a new curve?

Go back to your OI and think about what you can be the best at.

“If your OI is the price, then it is obvious that you need to be the cheapest in the district. If it's speed and efficiency, you need to be the fastest, but you can also be the easiest, or the most ready to go, or the most affordable. If your OI is quality, then you have a ton of options for being superior. You can be the most beautiful, the bravest, the happiest, the smartest ...

Do not be afraid to be ahead of everyone. "

Summary:

1. The pumpkin method in business means that you need to abandon the race for all customers in a row and from unnecessary business areas, choose the best customers and the most promising direction and do everything to become the best for the best customers in the most promising business direction.
2. Provide unique service to your best pet customers, anticipate their expectations.
3. Concept business. Make it so that any work in your company can be easily duplicated.
4. Use the 180 degree method. Review the general rules within which companies in your industry operate, and then do the opposite, new, and unexpected.

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