Win Customers, Needle Your Competitors, and Make More Money

May 1, 1996

Guy Kawasaki calls it "The Hippies and the Doughboy."

It's the story of how Ben & Jerry's, a tiny ice-cream maker in Vermont, twisted a blunder on the part of Pillsbury, the Fortune 500 company that made Haagen-Dazs, into a national public relations campaign---and made its name a household word.

In 1984 one of Ben & Jerry's distributors told Ben Cohen that Haagen-Dazs had threatened to stop selling its products to him if he continued to sell Ben & Jerry's products. In addition to the standard response of suing Pillsbury for anticompetitive practices, Ben & Jerry's saw an opportunity to pitch the battle as one between two hippies and a conglomerate. It launched small, targeted attacks on Pillsbury: placing a $250 classified ad in Rolling Stone magazine, putting protest signs on the back of buses, and having Ben's partner picket all alone in front of Pillsbury's Minnesota headquarters with a handmade sign that said "What's the Doughboy Afraid Of?"

Local press covered the picketing, and the national press, including The New York Times, The Wall Street Journal, The Boston Globe, and The San Francisco Chronicle, picked up the story.

Ben & Jerry's won the legal battle in 1987, but it won the larger battle, too. With its small campaign to drive Pillsbury crazy, Ben & Jerry's made its name known to people throughout the country.

That story illustrates one of the lessons Kawasaki preaches in his latest book, How to Drive Your Competition Crazy, namely, that of seizing opportunities to attack your competitors and strengthen your own business. Kawasaki was Apple Computer's software evangelist from 1983 to 1987; his job was to convince software companies to create programs for the Macintosh. He's now an author, a speaker, and an Apple fellow.

In an exclusive interview with TR Inc., Kawasaki gives inside tips on how to recognize and create opportunities to improve your business.

What does it mean to drive your competition crazy?

It's a process of creating disruption, meaning you disembowel the strengths of your competition. Simultaneously, you build up your own strengths. Let's say you're the small company. Maybe there are niches in the marketplace that the larger company can't go after because they're too service intensive. For instance, the 600-salesperson company has a really well known name in your area, so you decide to go on the Internet and specialize in people relocating to your area. You're reducing the advantage of being a bigger company and increasing your advantage by being on the Internet.

You say that businesses must know their competition, their customers, and their own company but that the most important thing is to meet your customers' needs.

The best way to drive a competitor crazy is to be successful, because people envy success. And the best way to be successful is to focus on your customers, not your competition. Company A can do things to company B to drive it crazy, but what's more important is that company A take care of its customers. And when its business increases, a side effect is that that success will drive company B crazy. But the reason for the existence of a company isn't to drive its competition crazy.

When you drive your competition crazy, what do you get besides a smile?

First of all, just a smile is OK. But it's much more than a smile. There's a certain value in the delight you get in driving your competition crazy, and it can be used to psych yourself up, to psych up your employees, to bring fun into a competitive market.

A lot of people need to get up in the morning and think, "I'm going to be superior to somebody today. I'm going to outdo somebody today." That's a perfectly OK attitude, especially in America.

You advocate playing with your competition's minds, but you don't advocate crossing the line. You say that people need to stop and think, "Would I be comfortable telling my boss what I'm doing?"

More important, your spouse. People don't think I'm serious, but the two tests are, ask your spouse and follow the Golden Rule. If what you want to do passes both tests, you can assume it's OK.

What techniques can real estate brokers use to learn about their competitors?

Certainly you should understand what it's like to be a client of your competition. That can be as simple as calling up your competition to see whether it has voice mail or a live person answering the phone. Is its voice mail particularly onerous? Do you get into voice mail hell?

Some large real estate companies are publicly traded, so you should buy one share of stock so that you get their annual and quarterly reports. You can also go to open houses, not just to scope out the property but to scope out the hosting organization. Does it have refreshments? What's the quality of its property information handouts?

Do you have to do these things clandestinely? Or is it OK to have your competitor know you're doing these things?

You should never lie. You should never go to an open house and say, "I'm thinking of buying a house," when you're in fact a broker. On the other hand, if nobody asks, you don't have to tell anybody you're scoping out the competition.

Would you advocate interviewing your competitor's salespeople and asking about commission splits or other inside information about the company?

If you're interviewing because you're truly interested in the salesperson, fine. But if you're interviewing just to get intelligence, I'd view that as unethical. The test for me, again, would be the Golden Rule. That is, if your salespeople were interviewed, would you want them to be asked the question you're about to ask? I'm a heavy believer in karma. I believe that every time you cheat, something happens to you.

You'd consider that cheating?

I guess it's how you ask the question. If you're asking it because you're interested in the candidate and you want to find out how to structure an attractive financial deal, it's perfectly ethical to ask, "What's your current deal so that I know your ballpark range, your needs, how you'd like to structure an arrangement?" That's very different from the totally unethical case of, "I'm really not looking for salespeople. I'm just going to interview them, pump them for everything I can, and tell them, 'Thank you very much. We're really not interested.'"

In real estate, the line seems fuzzy. Many brokers are always looking for salespeople, so it might be easy for them to say, "Sure, I'm hiring. If I find the right person, I'm hiring."

If brokers are always looking for new salespeople not because of growth but because of turnover, maybe they ought to spend more time retaining their current salespeople instead of constantly finding new ones. Maybe it's a situation where we've met the enemy, and the enemy is us. So instead of using all this competitive intelligence, maybe they should work on making their own salespeople happier so that they won't have to be interviewing.

What about salespeople who don't realize they shouldn't tell other brokers proprietary information about their current company? Is there something brokers can tell their salespeople to let them know what they shouldn't discuss with competitors?

If salespeople are naive and don't know they're spilling the beans, you can't be upset. You can have a formal nondisclosure agreement when you affiliate salespeople—not that those agreements work. And certainly as part of salesperson training, you should explain what information you consider confidential.

You also mention purging your mailing lists often. What's the big deal with having your competitors on your mailing lists?

If they're on your mailing lists, they see how you treat your customers. Even if they can get the information in another way, why make it easy for them?

Let's say one of your competitors has taken one of your ads and turned it around on you. What's the best way to respond?

Ignore it. One big mistake many people make is that they're too close to the market, and they assume a world of perfect information. Company A probably knows exactly what company B is doing, but the rest of the population doesn't know and doesn't care. So if you make a retaliatory strike, you can increase your competitor's credibility, and people who never knew about the situation will now know.

Almost a Ben & Jerry's example.

Exactly. Pillsbury created Ben & Jerry's in a sense. And it didn't have to. For all we know, if Pillsbury had just told its distributors, "Hey, carry any ice cream you want. We think ours is the best," maybe Ben & Jerry's would never have got the publicity and later died. But when Pillsbury acted, the whole world knew what Ben & Jerry's was.

You also advocate a program to make your customers evangelists for you.

Right. Our real estate salesperson has made a lot of money off my family, since we've bought and sold two houses in the past year and a half. We stuck with our salesperson not because he was playing dirty tricks on the competition but because we were truly convinced he had our best interests at heart, not his.

Is the benefit to your salesperson that you say in a national interview how good he was? Or are there other things he can do with your evangelism?

Certainly he can use me as an absolute stop-your-heart reference. I'd send anybody to him in a second.

So you're OK with him saying, "I've done a good job for you. Now will you let me use this to my advantage?"

Absolutely! Why not? In fact, it's my pleasure to recommend him to our friends. I know it'll further my reputation, because he'll treat them so well that the people I've helped indirectly will owe me another one.

There's that karma coming back to you, isn't it?

That's right!

Guerrilla Tactics That Taunted the Competition

One way to drive your competition crazy, according to Guy Kawasaki, is to turn your competitors' efforts to your advantage. Here are a few examples:

  • A Colorado pizza chain offered a two-for-one promotion to customers who brought in its competitor's Yellow Pages ad. The next time customers went to call for a pizza delivery, whose phone number would they find?
  • When British Airways announced a giveaway of 5,200 free flights on June 10, 1986, its competitor, Virgin Atlantic Airways, ran the following ad: "It has always been Virgin's policy to encourage you to fly to London for as little as possible. So on June 10, we encourage you to fly British Airways." In smaller type under that message, Virgin added, "As for the rest of the year, we look forward to seeing you aboard Virgin Atlantic. For the best service possible. At the lowest possible fare."
  • Another Virgin Atlantic example: When it entered the San Francisco market, it launched its promotional plan with a teaser billboard ad that said, "Yooooooo-hooooo, British Aiiiirrrr-wayyyys."
  • When F.W. Woolworth opened its first store, an established retailer hung out a sign: "Doing Business in This Same Spot for Over Fifty Years." Woolworth responded: "Established a Week Ago. No Old Stock."

Kawasaki's Nine Steps to Wreaking Havoc on Your Competitors

  1. Choose your enemy.There are good and bad and true and false enemies. Know which is which, and go after the right ones.
  2. Know your own company. Define your own identity, services, and management style and philosophy.
  3. Know your customer. Find the right way to get intelligence on the people you serve.
  4. Know your foe. Research your competition's identity and executives.
  5. Meet your customers' needs. Before you tackle any competitor, secure your own business.
  6. Pick your target. Carefully choose the right niche for your company to go after.
  7. Make your customers sing. Your praises, that is.
  8. Learn to identify openings. You'll never be able to take on a competitor if you don't learn to recognize opportunities under your nose.
  9. Follow the rules. Getting under their skin is fun, but it should never be unethical.
freelance writer

G.M. Filisko is a Chicago area freelance and former editor for REALTOR® Magazine. 

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