Opportunists v Survivalists and
A Cautionary Tale

The economic recession is dividing companies into two groups: 'Opportunists' and 'Survivalists'. Opportunists see the downturn as an opportunity to grow market share. Survivalists want to survive the recession with their market share or business intact.

Both outlooks are perfectly rational. Opportunists are excited by the opportunities that lower supplier and asset prices, changing customer needs and weaker competition create. Survivalists worry about the risks the recession poses to their margins and profitability.

Predictably, both sets of companies respond in different ways. Opportunists continue to invest in Competitive Intelligence. Decisions may take longer but Opportunists understand that it is a source of competitive advantage that helps growth. Survivalists cut back expenditure on Competitive Intelligence, because they don't perceive it to be business critical.

At Intelligentsia we have personal experience of both attitudes. In the last few months we have been chosen by four leading companies in the Technology, Infrastructure, Telecoms and Energy sectors to deliver their CI programmes (see Latest News for more details). These Opportunists grasp how competitive insight can, for example, make their propositions more compelling and increase their customer acquisition rates.

We also know some Survivalists. These clients want to commission CI work but face a freeze on expenditure or fear being rebuked for suggesting it. There is bottled up demand and growing frustration among this group. Nevertheless to a Survivalist, riding out the economic storm and conserving one's resources are paramount.

Now for a cautionary tale! Two companies - Kellogg and Post - competed in packaged cereals in the 1920s. During the Great Depression, Post was a Survivalist: cutting expenditure and advertising. Kellogg was an Opportunist. It doubled its advertising, moved into the new media of the day (radio advertising) and launched an innovative new product called, Rice Krispies. By 1933 Kellogg had become the dominant player in packaged cereals, as it is today.

A number of studies confirm that companies that keep spending when times are tough do significantly better when the recession is over than those that don't. Survivalists should take note!

John Pearson
Chief Executive