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A Step-by-Step Guide for Acquiring Competitive Information

Collecting information about your competitors makes good business sense. However, you must do so in an ethical and reasonable way. Competitive intelligence from public sources, customers, and third parties can help businesses anticipate market opportunities, trends and competitive strengths and weaknesses.

These guidelines provide a step-by-step guide for acquiring the information you need without crossing the line.

1. Ask questions - If you come across or are offered competitive information and believe that it may be confidential or proprietary ask questions to find out how the information was obtained, or why it was made available.

2. Be ethical - How would you or your business react if you found out that your competitors were receiving the kind of information that you acquired? If you think that a particular way of gathering competitive intelligence may be unethical, you should assume that your competitors would view it the same way.

3. If it doesn't seem right, don't do it - If you're ever in doubt as to whether a source of information or contemplated technique of gathering information is proper or legal, you should contact your manager or attorney.

4. Breaking the law has consequences - If you improperly gather or use competitive information, you can be disciplined or terminated, and you could face criminal and civil penalties. Breaking the law can also result in adverse publicity to your company. Think about how you'd feel if your actions were publicly disclosed on the front page of a newspaper.

5. Legitimate sources of competitive information include:

Public sources. You may gather information about your competitors from public sources such as:
a. Newspapers, magazines, other published articles and television programs
b, Advertisements and brochures intended for public distribution
c. Information freely available on the Internet and online research services
d. Public filings made with governmental or regulatory authorities, such as SEC reports, patent filings and litigation records
e. Analyst reports
f. Industry surveys or reports
g. Public presentations given by competitors at trade shows and conferences
h. Freedom of Information Act (FOIA) and similar requests from governmental or regulatory agencies

Conversations with customers.
Talking with customers is essential. The more you know about your customers and their businesses, the better you can meet their needs. However, you shouldn't contact customers for the purpose of obtaining confidential information about a competitor. Customers may disclose information about a competitor's products or pricing, so long as the information is not confidential.

Hiring third parties to obtain information.
Sometimes company's hire third parties to help us gather competitive intelligence and information about the market for products and services. Third parties are subject to the same standards of behavior that you abide by, so you should assume that if we can't do it directly, you can't hire someone else to do it.

Third parties conducting focus groups or interviews with a competitor's suppliers or customers generally don't have to identify you as their client, so long as they identify themselves and their company. While a third party doesn't have to disclose the purpose of the focus group or interview, the third party shouldn't intentionally misrepresent the purpose.

A few of your competitors may have informed you that you cannot subscribe for their products and services. In these cases, you should not hire third parties to access the competitor's products or services. However, absent knowledge that a competitor would have barred or prohibited your access, you may engage a third party to subscribe to the product or service.

Keep in mind that your company can sometimes be legally responsible for damages or losses caused by a third party if you authorized or appear to have authorized any illegal actions. This can be the case even if you don't issue direct instructions to the third party, but know of the third party's likely conduct and "turn a blind eye".

If you engage a third party to gather competitive information, you should have the third party confirm that it is aware of, and agrees to abide by, applicable laws related to competitive intelligence.
Some types of information gathering, however, can violate the law or may be considered unethical. Some examples Include:

New Hires. What you can and can't ask former employees of competitors.

You shouldn't ask or encourage employees who previously worked for a competitor to divulge confidential or proprietary information about the competitor, such as specific details about a competitor's operations and intentions, including pricing, future plans and forecasts which may have been considered confidential or proprietary by a competitor.

If you previously worked for a competitor, you shouldn't disclose information about your former employer that you believe is confidential or proprietary, or bring any of this information into your office.
However, you may discuss items of a general nature with an employee who previously worked for a competitor including anything that's a matter of public record or that wasn't treated by the employer as confidential.

Misrepresenting your identity. You shouldn't misrepresent your identity in order to obtain competitive information, if the person you're seeking information from would not ordinarily give you the information if they knew your true identity. This can be considered fraud. For example:

a. You shouldn't contact a competitor, posing as a customer, student, private research firm or potential vendor/supplier, to find out information.
When providing information in order to gain access to a competitor's website, you should answer all required blanks accurately, but you don't have to fill in blanks that are not required.

b. You shouldn't attempt to acquire a competitor's confidential or proprietary information through illegal means, such as theft, spying or hacking.

c. You shouldn't perform any surveillance or monitoring of competitors outside of public places or engage in any form of electronic eavesdropping. However, if you're sitting on an airplane or are at an industry conference and happen to overhear a competitor discussing a confidential matter in the row ahead of you, the competitor likely has no reasonable expectation of privacy.

d. Giving gifts for confidential or proprietary information. In gathering competitive intelligence, you should not give entertainment, gifts, favors or gratuities to induce someone to provide you with information that's confidential or proprietary. You may, however, pay third parties for competitive intelligence that's derived from legitimate sources.

e. Anonymous packages containing confidential information. If you receive anonymous submissions of competitive information you shouldn't distribute or use the information.
Information marked "Confidential." etc. You shouldn't use or purchase information belonging to a competitor that is marked "confidential" or "proprietary."

f. Offers to access competitors' products and services. If you're offered access to a competitor's product or service by a customer, friend or other person, and you ordinarily would not be able to access the product or service on your own, you should decline the offer.

g. Misplaced or unattended confidential information. You shouldn't use confidential information belonging to a competitor that is accidentally misplaced or left unattended.

h. Dumpster diving. This is inappropriate and it may also be illegal.

i. Competitive bid information. You shouldn't seek or use information that you may receive about a competitor's bid if you're involved in bidding, especially on government contracts. However, you are free to use information that is disclosed by the government, publicly available or retrievable pursuant to a FOIA or other similar request.

j. Information offered in business pitches. If a customer offers competitive information to us during a business pitch, we should understand that the customer may owe a confidentiality obligation to our competitors who are also pitching for the business. As such, we should generally decline to receive information under these circumstances. However, if we are being told something very general or high-level, it may be appropriate for us to use this information in our bid and in our larger business strategy.
Regardless of what method you use to collect competitive intelligence, if you have any question as to the legality of your activity, err on the side of caution and chose another method!

Use these techniques and you'll be more knowledgeable about your competitors than anyone else. This information is not only beneficial but can be obtained without breaking the law. Make sure your competitive intelligence practices are up-to-speed.

About the Author: Michael Fleischner is an Internet marketing expert with more than 12 years marketing experience. He has appeared on The TODAY Show, Bloomberg Radio, and other major media. For a complete database of Marketing Service Providers visit

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