The year 1980 was bad for the auto industry, bad for the Democratic party, and bad for Bob Ladner. Ladner, founder and president of a Florida-based consumer market research firm for the financial and high-technology industries, had been struggling for five years to keep his business alive. Things had brightened temporarily in 1979, when he was finally able to move his business, Behavioral Science Research, to vastly expanded facilities in Coral Gables. But less than 12 months later, BSR was near death.

"In 1980, I spent thousands of dollars traveling up and down the major markets pitching my company," recalls Ladner, "and I was turned down more times for what I regard as sheer cowardice. People said we're too far away; people said they've never done business with us before; people said they don't know our credentials. It was the same old garbage excuses for using the same old tried-and-true larger companies."

After a while, Ladner got pretty good at responding to these objections. He would point out that a number of major research firms were in "some little jerk-water town" in Ohio or Nebraska, so why shouldn't he run his 10-person firm out of south Florida? He would remind recalcitrants that WATS lines and overnight delivery services have made this country a mighty small place in which to do business. He would even offer to pay his own travel expenses if necessary.

Still, the risk of trying a new supplier was too great for most companies to consider gambling thousands of dollars and precious hours on iffy prospects. They preferred to stick with the well-known names. It was then that Ladner realized the true challenge he faced. "What I had to do," he explains, "was come up with something that would make it impossible for someone to turn me down."

Ladner wanted to position his firm in such a way that BSR would emerge above competitors from the moment of his first sales contact straight through the bidding process. He needed a marketing hook that could snare skeptics and conservatives who were uncomfortable with chancy investments of time and money -- and that covered just about every major research buyer in the country.

It was in the middle of another hard sell the next year that Ladner stumbled on his nearly irresistible marketing tool. "Around the middle of 1981, I got involved with a guy in New York whom I was trying to pitch," remembers Ladner. "Every time he raised an objection, I would answer it. I was real good at countering objections and trying to press the sale. Finally, I said to him, 'What in the blip do you want? A guarantee?' And he said, 'If you could offer it, it would make a difference. But nobody does that.' I just sat there with egg on my face, and then I said, 'Well, I can't either.' "

But that incident got Ladner thinking. A one-time only, introductory guarantee on work for new clients would certainly eliminate their fear of losing a large chunk of the company's research budget on an untried supplier. The problem was turning this extraordinary idea into a practical solution. Not only would it be hard to convince prospective clients of the sincerity of such a claim, but it would also leave his company vulnerable to corporate miscreants eager to find warranty loopholes that could provide them with free research. Too much of that would bury BSR forever.

It took nearly two years of intermittent research and refinement, but late last year, Ladner unveiled the selling device that he jokingly characterizes as "an offer they can't refuse." He began offering clients a 100% guarantee that promises BSR's work will be on time and on spec, or clients get their money back -- all of it. No glitches, no waiting, no joke.

The need for a marketing hook was no longer a matter of life and death for Ladner's firm. BSR's sales had improved in the last few years even without the guarantee. But Ladner was determined to bring his marketing brainchild to life. In January 1983, he hired a marketing services agency in New York City to help him find an insurance company willing to underwrite his warranty. If he could buy a policy like that, the extra backing would lend credibility to his promise, and it would protect his firm from the financial strain of possible claims.

Meanwhile, galvanized by the sheer novelty of the concept, Ladner held a focus group with 10 executives from major research buyers in the Northeast to test the offer's allure.

"The first response was absolute incredulity," says Ladner. "They shot it down -- they said nobody could do it. They kept giving me reasons why. So finally I said, 'Forget this business of 100% guarantees. Just tell me what pisses you off about research suppliers.' They then talked to me about the failure to deliver on time; the failure to have research that addressed the questions at issue; the failure of questionnaires to be comprehensive. So I took all these objections and I built them into the guarantee."

By the time summer came around, Ladner was ready to roll out a direct-mail campaign to get new business, complete with an introductory money-back pitch for first-time jobs. He had enough confidence in his staff to believe they could meet the high standards of the guarantee. With an insurance policy as a financial cushion, the whole thing looked practically risk-free.

But his marketing services agency had not yet found an insurer willing to underwrite BSR's guarantee. Frustrated by what he perceived as foot-dragging, Ladner dismissed the company, and started his own search for an amenable insurer. After two months and some false alarms, he finally found an obscure broker in New Jersey who would agree to underwrite the policy at premiums BSR could afford. Ladner was ecstatic.

In late July, Ladner decided to test-run his guarantee by mailing some 600 brochures to prospective clients with the following conclusion: ". . . we're honest enough to make this guarantee: The work we do will be on time, on spec, and better than you asked for. Or it costs you nothing."

In early September, Raymond F. Donnelly Jr., then director of marketing for City National Bank of Miami, contacted Ladner about a possible market survey to measure and define the bank's positioning in the consumer arena. City National had not used a research firm in 45 years, but recent deregulation of the financial industry had them worried about the competition. Donnelly had heard of BSR through other banking industry sources, but was unaware of the firm's new guarantee to first-time clients. He invited Ladner to draw up a proposal and enter his bid on the survey along with several other research hopefuls. If BSR won the contract, City National would be the first client to qualify for Ladner's money-back contract.

Donnelly recalls being impressed with Ladner's thoroughness during the proposal stage, although he was wary of trying him out on such a big project. "We had so many objectives, and Bob was very helpful in narrowing them down to what I wanted to find out. But I said to him, 'How do I know you're going to deliver what you are promising?' It was a heavy expenditure on the bank's part, because it was a benchmark awareness study. We were talking about 400 interviews, and the cross section [of high net-worth consumers] that we were interested in penetrating was difficult to get a hold of."

But when Ladner pulled out his 100% guarantee on the project, Donnelly's fears dissolved. "I had heard about Bob in the marketplace. I knew his credentials were good. But coming across with this kind of proposal was another thing. I bounced [the guarantee] off a few of his competitors, and they said, 'It's virtually impossible to guarantee results. We do our survey based on our own rationale. This kind of stuff I considered to be gobbledygook after having heard what Bob had to say. So in my mind there wasn't any decision other than to go with him."

As far as Ladner was concerned, landing the City National job was proof positive that the guarantee worked. It was the element that cinched a job when other arguments had failed. Above experience, above reputation, the guarantee could not be topped by other bidding firms. It is what made Ladner stand out above the rest, and best of all, it is what gave his new sales prospects the confidence and assurance to go with Ladner's qualified but unknown firm.

But there was a problem. Shortly after landing the sale with Donnelly, Ladner learned that his insurance company wanted to back out of the program. It wanted time to track his success rate before putting its money on the line. But Ladner had already promised the guarantee to City National. He couldn't back down, and besides, he was beginning to receive responses from the mailers he had sent out in July. He decided he would have to insure himself.

Less than a month after contracting with City National, Ladner was contacted by Allen Osborne, director of marketing for Community Federal of the Palm Beaches, a bank in southern Florida. Osborne had received Ladner's mailing, and was intrigued by the guarantee. The bank was interested in commissioning a series of focus groups to investigate consumer reaction to new alternative financial services now available through financial institutions. Osborne wanted Ladner to enter his proposal, subject to the guarantee.

Community Federal had used other market research firms in the past, and had contacted several for competing bids on the focus group project. But the guarantee from Ladner just couldn't be beat. BSR was chosen for the job.

"I was impressed with the guarantee from the beginning," says Osborne. "It was saying that they were willing to put their money where their mouth is. That's unusual in any business, but it's even more unusual in the market research field. Research is not like having a product and putting it in a box and having someone open it and say, 'It's here' or 'It isn't here.' Though market research is getting more and more scientific, it's still somewhat subjective." To avoid arguments over whether or not BSR's final product is or isn't in the box, Ladner designed a guarantee specifying research objectives and deadlines (up to the exact hour of delivery, if necessary) to protect both BSR and the client from disappointment and messy wranglings after a job is completed. The guarantee includes certain provisions to ensure that clients will not hold up information or payments, which could jeopardize the outcome of the project. Although the guaranteed contract demands more attention from the client than a normal agreement, so far no one has objected to what is perceived as necessary to the success of the work. Once a final report is delivered, the client has 90 days to complain about flaws related to the guaranteed work.

BSR's liability does not extend to clients' subsequent sales performance resulting from implementation of market research recommendations. Nevertheless, Osborne reports that the now completed Community Federal project was highly successful. Research results recommended introducing a discounted certificate of deposit to customers. The bank followed through, and found that revenues generated from the product far exceeded their expectations.

To date, Ladner has completed four projects under the introductory offer, and has landed another six new clients with the guarantee, including large accounts outside the Miami area. He has even extended the guarantee to cover all work for clients snagged through the offer, largely because of an unexpected but pointed observation by Allen Osborne.

"Initially the guarantee is impressive," notes Osborne, "but to continue it for other projects serves to strengthen its credibility. You could say the introductory offer is neat, but as the old consumer line goes, 'What have you done for me lately?"

Although Ladner is pleased with the results of his marketing ploy so far, he is disappointed that he can't find an underwriter for his program. Still self-insured, he holds a percentage of every revenue dollar in reserve in the event that someone rightfully demands a refund. "I believe sooner or later I'm going to have to pay off on one of these guarantees," he says ruefully, adding, "Who wants to slice off 8% or 9% of every single dollar and hold it in a money market account in case you have to draw against it to satisfy someone who's being querulous?"

But he is moving ahead with the program, and has even hired Raymond Don nelly -- who left City National in February to found a marketing consulting firm -- to help him market the guarantee, including working out a new direct-mail piece detailing the terms of guaranteed projects. By June, 1,000 of these pieces are scheduled to go out to marketing departments in companies around the country.

Daniel Lombard, executive director of the Professional and Technical Consultants Association in San Jose, Calif., skeptical of the practicality of Ladner's offer. "It's certainly a novel approach," says Lombard, "but in my opinion it wouldn't work. One would have to research a client thoroughly to resolve questions of their own ethics before entering into a contract like this. Market research is a document, and as such it is very subjective. A 100% happiness factor would be difficult to achieve."

Yet, despite the difficulties of self-insuring a research guarantee, Ladner looks forward to working on more of these new-client projects. "The fact that a job is guaranteed has a salutary effect on project management and on cash flow that is incredible. For some clients, it's nice to know that we guarantee our work, but they don't want to go through the whole megillah of working out specifications. They are appreciative that I would go so far as to give a guarantee, but they don't want to be bothered with it. The guarantee is a method of generating confidence. The longer I do it, the more the risk decreases. I would be unafraid to take this thing now and give it to anybody who comes to me as a client -- zero problem."