Research leads to better-tasting frozen pizza

Schwan, a leading US frozen food specialist, faced a key strategic problem. It learnt that its main competitor – Kraft – was working on a new type of frozen pizza that had a rising crust. Schwan knew that if Kraft could succeed in creating a better-tasting frozen pizza, then it had the potential to command a market that was dominated by lower-quality products. As one article put it ‘. . . . it was often hard to taste the difference between a frozen pizza and the cardboard box it came in.’⁴¹ What Schwan didn’t know was how fast Kraft was planning on rolling out this new product and, therefore, how quickly it needed to respond.
To find this information out it contracted a corporate intelligence firm (a SCIP member), who in turn hired a former undercover law enforcement specialist who had built his skills by spending years infiltrating criminal gangs. Through adopting a series of ‘fake’ phone disguises, including a journalist, environmental campaigner and potential supplier, the specialist made phone calls to various individuals involved with the construction and operation of a new plant, together with public employees involved with approving construction and running. Through this he was able to piece together an accurate picture of a very high projected volume of sales. Based on this advice, Schwan invested considerable resources into launching its own ‘Freschetta’ brand, which was able to secure a large part of this important new market.

What information can you get from competitive intelligence?

The ethical issues surrounding competitive intelligence (CI) can be understood by looking at some of the activities that practitioners of CI claim they can undertake. The following list comes from an article profiling a CI professional in the USA and lists some of the things they claim they can undertake, the likelihood of success and how long it will take to gather the information:

• Cell-phone number of your competitor’s main contact with Walmart:
• 80% chance; five minutes.

• The names and contact information of the people suing your biggest rival:
• 80% chance; 30 minutes.

• Stake out your competitor’s booth at a trade show to see what people are saying about your product:

• 95 % chance; four hours.

• The market segmentation your competitor is using in its advertising:
• 95% chance; one to three days.

• Stake out your competitor’s manufacturing facility to see how much stuff it’s making:
• 95% chance; three days to three weeks.

• The names of your competitor’s top five salespeople and their salaries:
• 80% chance; margin of error +/− 10%; three days.

• Identify which of your competitor’s former executives are most likely to come to work for you:
• 80% chance; one week.

• Profit margin of your competitor:
• 50–50 chance; margin of error +/− 10%; five to ten days.