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How the creators of Ben & Jerry's, two ice cream-loving hippies from Vermont, teased food conglomerate Pillsbury into submission.In the spring of 1984, Ben & Jerry's was beginning to generate some real business momentum. Having launched their business from a renovated gas station in Burlington, Vt., they quickly built up a loyal following through delicious ice cream and some imaginative public relations moves.

In 1979, they gave out free scoops on their one-year anniversary, and in 1983 they created the world's largest ice cream sundae. In 1984 they were able to set themselves up for wider distribution by establishing a statewide public stock offering, selling shares to Vermonters for $10.50 each.

That's when Ben & Jerry's hit a wall. Called to Bean Town on an emergency meeting with distributors, Ben Cohen learned that premium ice cream brand Häagen-Dazs was threatening to pull its business from distributors unless they signed an agreement precluding them from selling other premium brands. Of course, most distributors couldn't afford to stop carrying Häagen-Dazs, which in Boston was outselling Ben & Jerry's by more than four to one.

"If, by virtue of Häagen-Dazs's ‘us or them' edict, we were precluded from using any of those distributors, we'd be relegated to using small, one-truck operators who had little clout with the retailers, wrote former Ben & Jerry's CEO Fred Lager in Ben & Jerry's: The Inside Scoop. "The only alternative would be to set up company-owned distribution, something we had neither the financial nor the managerial resources to do."

A lawsuit was out of the question, since Pillsbury's lawyers could keep the case tangled in red tape for years, bleeding Ben & Jerry as it struggled to find new avenues of distribution. After a weekend-long brainstorming session, Ben Cohen and Jerry Greenfield decided to appeal directly to the public via an 800-pound guerilla marketing campaign.

Takin' It to the Streets

"We decided up front to cast ourselves in a fight against Pillsbury, not Häagen-Dazs," Lager wrote. "Häagen-Dazs versus Ben & Jerry's was one ice cream company against another. Pillsbury versus Ben & Jerry's was the Fortune 500 against two hippies."

While Ben Cohen composed a press release announcing his intent to secure a restraining order that would prevent Häagen-Dazs from following through on its ultimatums to distributors, Jerry Greenfield flew to Pillsbury headquarters in Minneapolis, Minn., and became a one-man protest, holding a sign that said, "What's the Doughboy afraid of?" and handing out flyers.

"Do you think the Doughboy is afraid of two guys working with 23 people in 4,000 square feet of rented space?" the flyer said. "Do you think the Doughboy is afraid he's only going to make $185.3 million in profits this year instead of $185.4 million? Do you think the Doughboy is afraid of the American Dream?" Below the questions was information on writing in to Pillsbury chairman William Spoor as well as a coupon for a $10 tee shirt supporting the Ben & Jerry's cause.

Meanwhile, Ben's temporary restraining order went through.

"Although there was no admission of guilt on the part of Häagen-Dazs, it was a great victory for us," Lager wrote. "Without having to argue our case in a courtroom, the immediate threat to our distributors had been eliminated, and with minimal expense. Even more impressive was the fact that we had given up nothing in return. There were no restrictions in the stipulation the prevented us from continuing to hammer Pillsbury."

An 800 number dedicated to explaining the issue was printed on every pint of Ben & Jerry's (Greenfield observed recently that the majority of phone calls came in between midnight and 3 a.m.) while the offer of a supportive bumper sticker was placed in the back of Rolling Stone magazine. One of the grander PR strokes was Ben Cohen's arranging for a plane towing the "What's the Doughboy Afraid Of?" message to fly over a Boston College football game at Foxboro Stadium.

The Reaction

As Pillsbury's distributor deadline neared, the media on the story grew bigger: feature articles turned up in the Wall Street Journal and the New York Times while the Boston Globe put the story on the cover of its Sunday magazine.

Pillsbury finally called uncle in the fall of 1984, eager to hammer out some sort of agreement before the issue went to court. The two sides went back and forth for nearly six months, finally coming to terms in March of 1985: Häagen-Dazs agreed not to take actions against distributors who carried Ben & Jerry's. Ben & Jerry's were given two months to stop using the pint cartons with the 800 number.

They could afford to stop, what with sales of Ben & Jerry's ice cream hitting $4 million, a 120 percent increase from 1983.

"[Ben & Jerry's] got PR and exposure they couldn't buy for millions," Häagen-Dazs founder Reuben Mattus was quoted saying in a 1985 piece for the New Yorker. "What they did in a couple of years took me eighteen years to do."

Lucky number thirteen in our series "From the Vault: Financial Analyses of the Sometimes Rich and Famous," an ongoing ReZoom.com Finance feature that spotlights celebrities and their money. To read about the complex legacy of New York hotel queen Leona Helmsley, click here.