"Pumpkin Method". How to grow perfect customers and sift out bad ones

We share with you a sammari (a brief statement of ideas) on Mike Mikalovits's book “The Pumpkin Method. How to become a leader in your niche without a budget. ” In the original, the 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. The book is about something else.
We recommend reading to those who are stuck in working on their own business, who are chasing after each new order, who are tired of bad customers, and everyone who wants to make their business outstanding. We may have something to learn from farmers who grow giant pumpkins.

So…

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What awaits you without the pumpkin method

Mike Mikalowitz knows this from his own experience. He created a successful company Olmec, however, in his words, he was a “crazy slave of his business” - he worked almost all the time, didn’t sleep much and didn’t spend enough time with his family. Mike suffered from a common "if only" disease. He believed that if he had only found another large client or order, the situation would have changed for the better. But this 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 an uncle” they will have a free life. However, in reality, starting and setting up your own business turns out to be much more complex, routine and tedious work. Even when Mike's company reached the millionth level, the routine was not less. Mike and his companion continued to rush like mad. After two years of such a life, the author realized that he had burned out and it was time to change something. He hired a personal coach who said that until Mike stops doing all the work himself, until he learns to schematize a business, he does not have the right to be called an entrepreneur. He also advised Mike to cut down the list of clients, choosing only those that bring the maximum income:

“Sort clients by income. Then choose the ten customers who pay the most and divide them into two categories: good customers and everything else - from just boring customers to those who annoy you so much that you shrink from horror when they call you. Leave the best customers who pay the most and get the rest. One and all.

At first, this idea caused internal resistance, - the author got used to chasing each client, fearing to miss the order. But over time, he realized the correctness of the new approach, making sure of its success in practice.

Principles of growing giant pumpkins for business

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

The article listed the principles of growing giant pumpkins:

1. First you need to plant promising seeds;
2. Water and care for them, removing diseased or damaged shoots;
3. Weed constantly, leaving no weeds,
4. When the pumpkins grow, remove all the less promising, leaving the strongest;
5. Then leave only one best pumpkin, for which to look after the clock as a child, guard it and observe how it grows.

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

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

Step two. Sell, sell, sell.

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

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

Step five. Identify your best customers and take away the rest of the least promising.

Step Six. Concentrate all the attention on the best customers. “Fertilize” and protect them, find out what they want most, and if this is combined with what you can do best, give them that. Then repeat the same thing — a service or product — for as many good customers as possible.

Step Seven. Watch your company grow to gigantic proportions . ”

The understanding of how to act that came to him is described by Mike Mikalowitz as an epiphany. He began to work according to these principles, which are united under the name "pumpkin method". He stopped scattering and wasting energy on trifles, and finally realized that the constant running around for new clients prevents him from concentrating on the best customers who generate the greatest income and with whom it is most advantageous to deal with. Applying the principles of growing giant pumpkins in his business, he immediately felt the positive effect. He sold his second company, built using the pumpkin method, for millions of dollars to a Fortune 500 company.

What Mike Mikalowitz advises those who start their business:

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

“We can find the best answers only if we ask the right questions. Instead of asking, "Why am I fighting with all my strength to make ends meet?", Ask: "How do I bring home two thousand dollars every day?" One way or another, 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 spending time, effort and energy on it.

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

"This is the place where your favorite customers can get the most out of the systematized core process on which your business is based."

If you are just opening a business and you have no clients, then 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?

“It's not just about a product or service — it's about your approach to delivering a product or service, and special talents, and abilities and experiences that you can offer. This is your Big Idea, your know-how and your mojo, mixed in one crazy cocktail that you can't repeat. ”

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

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

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

“Schematization is what 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 it 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 the Olympics, your greatest strength and your experience.
3. Schematization - organize your work so that it is easy to repeat.

The union of these three elements is your golden vein, your super seed. But it is important to remember that without at least one component, your business will not take off.

Do not be afraid to "kill"

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

“More is not better. Better is better. ”

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

How to determine 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 does it pay?
2. Sometimes you get something or permanently?
3. Can we expect a significant income from it in the future?
4. How well does it communicate with you?
5. Does it forgive for mistakes, does it provide an opportunity to correct?

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

1. Work with him gives new opportunities?
2. Does he recommend you to others, is he ready to do this?

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 in 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 guideline, go against yourself, and this always leads to failure.

How to dismiss a client:

• Remove the service he uses, or stop servicing companies of the type to which he belongs.
• Priority is given to the best customers.
• Raise prices to such a level that they become unavailable to this client.
• Tell unwanted customer that the customer is important for you against his service.

Start by firing the most annoying customer and notice 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 nice and pleasant. Catch customers continuously.

Harness Technique

In the words of Mike Mikalovitsa, " money is the blood of your business ." As long as you serve bad customers, you lose blood. It is necessary to stop the bleeding, on which the technique of the harness is directed.

“Just remember that the harness technique is a method of reducing or eliminating the costs associated with customers who received the lowest scores on your scoreboard; these are sick pumpkins that you clean up immediately. They do not just annoy and absorb time - they suck blood. You have a whole bunch of expenses associated with meeting the desires of your worst customers. Therefore, until you are bled out, 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 bad customers, you need to get rid of the costs associated with them, for example, expensive equipment or employees who have helped them serve. Evaluate your expenses - do they help to serve the best customers, and how to ensure that they are aimed at achieving this goal?

Create your ideal structural scheme - 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 biggest in the city. ”

How to serve customers using the pumpkin method

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

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

Follow the principle “The buyer is not always right, but the right buyer is always right . ”

Promise less, give more. This refers to the time of order fulfillment (if you say what you will do by next Thursday, do it by Wednesday), to invoice amounts (issue an invoice for the amount less than originally announced), to quality (add pleasant customer to the completed order).

“Managing expectations and overfulfilling them is a formula for super-happy customers who stay with you for life. This is another big bright feather on your hat. ”

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

How to make clients help you?

Do the polls correctly

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. Here will help the list of wishes of customers, which is created on the basis of surveys.

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

Examples of the right 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 exactly is causing you the greatest difficulties?”
• “If you could modify the products or services that my industry provides to better suit your needs, what would you change?”

The human brain is designed so that it is always looking for answers to questions. To get the right answers, you need to ask the right questions.

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

“You will not have the ability or desire to fulfill each item on your customers' wish list. It is in the order of things. Actually, it is even more than normal, because you need to be the best in the world with just one point in order for customers to flow to you. Your goal is to work within your gold vein, and not outside your comfort zone. Not every good business idea is a great idea for your business . ”

Use Insider Strategy

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

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

To implement an insider strategy, the author advises to follow the following procedure:

1. Predict. Ask potential customers if they would be interested in your offer;
2. Thank people for their interest;
3. Notify me of the start of work after you understand from the polls 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. Give more than buyers expect. They will be disappointed if they get only what they expect;
8. Watch for feedback.

Narrow niche, broad prospects

Doing everyone in a row is a losing strategy. Pumpkin method involves leadership in a narrow niche.

Two steps to narrow the 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 do if you focused solely on this narrow group?”

Choose the right sellers

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

"The result of all these meetings will be that you need to ask the sellers to recommend you to their best customers, but for the moment, just help each other hit your mutual customer."

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

Schematization Paint all the details, print it and hang it on the wall!

Mike Mikalowitz 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 do their work, as people with more experience were not flexible enough. Mike Mikalowitz came to the conclusion that another approach works better - business mapping.

It consists in creating simple and perfectly understandable schemes for carrying out tasks, like safety instructions on planes that anyone can figure out. Then there will be no problems with replacing an employee; anyone can duplicate his work. Creating such schemes is quite tedious and time-consuming work that 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. This solution will allow us to better serve our best customers?
2. Will this solution improve or support our OI?
3. This decision will allow us to increase or maintain our profitability ?.

How to get rid of competitors: kill the curve

Mike Mikalowitz is convinced that the supply-demand curve reflects demand based on supply — this is “not what people want; This is the best option for them among what is offered. ” Over time, it’s not the demand that is falling, it’s consumers responding 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 is simply out of date. 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 in your competitors (behavior, schemes, policies), and then do the opposite, new and unexpected.

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

Pay attention to the complaints and wishes of customers. What will help you get ahead and create a new curve?

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

“If your OI is the price, then obviously you need to be the cheapest in the area. If this is 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 plenty of options for what to be excellent. You can be the most beautiful, the bravest, the happiest, the smartest ...

Do not be afraid to be ahead of everyone. ”

Summary:

1. The method of pumpkin in business means that you need to abandon the race for all customers in a row and from unnecessary business lines, 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. Scheme the business. Make sure that any work in your company can be easily duplicated.
4. Use the 180 degree method. Analyze the general rules within which companies in your industry operate, and then do the opposite, new and unexpected.

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