Smile and Dial

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Smile and Dial

We recently did the research for a potential class action suit against a major wholesaler, spearheaded by a potential competitor wishing to gain a foothold in a constrained market. Their target company sells to a small number (100 or fewer) of trade stores in a city of 5 million.

Because of the small numbers involved, we called most of their clients and asked them (the researcher clearly said that the action was in the formative stage and sponsored by an industry competitor, and that this was only preliminary research) the following questions:

A) Are you happy with XYZ?

B) What unfair Trade Practices have you seen from XYZ?

C) What other problems are you having?

D) What is your average monthly sales volume with XYZ?

The response was unbelievable, both in terms of the potential litigation and in its competitive intelligence value:

• We learned there were no competitors and that when a few of the companies got together to go around this wholesaler, they were buried in the paperwork of litigation.

• We learned that this practice of unfair trade competition could be a monopolistic practice and that it could be actionable.

• We learned that the company’s COD policy was very frustrating, and that even a 15 day grace period would be better.

• We learned the names of most of the sales people of the company and their estimated annual revenue.

In short, in 32 billable research hours we had amassed enough information about the target company for both valid litigation and for our client to consider a new marketing strategy.

Customers are a great source of information about a competitor. After all, the ultimate arbiter as to how well a company does is the customer.

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