Seth Godin recently made the remark that Marketers fall into one of two categories:

“A few benefit when they make their customers smarter. The more the people they sell to know, the more informed, inquisitive, free-thinking and alert they are, the better they do.

And most benefit when they work to make their customers dumber. The less they know about options, the easier they are to manipulate, the more helpless they are, the better they do.”

Rather than looking at this disparity as good versus evil as he does, at Paladin Principals, we see the difference as different tactics for the different stages of a Brand’s life.

If you are selling the market leading product, to keep your superficial marketing costs down, you provide mass marketing. This works fairly well since you already have the dominant market position. But that doesn’t work forever because . . .

There will be market entrants.

Market Entrants come in throwing stones and inspiring your market to ask new questions. They educate your customers. They have a more entrepreneurial marketing staff – like you did when you started – and they have it all on the line. They are in a fight for life. They are experimenting with bleeding edge marketing tactics. They are pushing the line in every direction just to see what will work. And some of what they do will work extraordinarily well.

So, is the answer to keep your super entrepreneurial marketing staff and attempt to scale so you can avoid the market entrant down the line? Many consulting firms will tell you that that is the only way to stay relevant . . .

We say No.

My answer surprises and upsets my buddies in major marketing departments. They all fancy themselves as entrepreneurs, but if you’ve seen the underbelly of marketing departments at very large market leaders – from tech to soda – you know that to do the work of 1000 monkeys, you’d better have 1200 monkeys on staff. That is the reality of large corporations.

The vast majority of the time, the market leader can sit on his laurels – spend less on marketing, streamline operations. Until the market gets excited about a new feature/product/service, your dollars may be better spent on acquisitions: IP, market share, sales force, warehousing. It isn’t until the leader’s dominant position is threatened that it is worth the expense to bring back the entrepreneurial folks. You can’t afford to keep them on staff in the in-between times. No, it isn’t that the salaries are too high . . . it’s that the risks entrepreneurs crave can wreck your bottom line.

A very good company sees this pattern of yin/yang and rides the ride. An excellent company builds the ride and rides the ride. To keep interest in your market or on your products, your market needs tension. You need the market entrant to look like it can threaten you. You need your market to have a reason to look at you with fresh eyes. You need your buyer to feel like he is choosing you.

Was there a cola war before Pepsi challenged Coke?

No, cola was just something to put on the table, until  . . . The Challenge.

Those born before 1960 are less likely to get hysterical about soda. But, If you offer Pepsi to a Coke-lover born after 1960, he will turn you down and choose anything else. Or he will go thirsty. After all, he was in the Pepsi Challenge (started in 1975), and he was forced to choose sides. That public declaration will be enough to keep him choosing Coke for the rest of his days – not only choosing coke, but choosing against Pepsi. Psychologically, it will be very hard to break his bond with Coke.

So when you are in a dominant position, you can keep your costs down and wait for the market entrant to start throwing stones. Or you can create the tension – design the ride – by creating the market entrant. Why not invest a few dollars helping a potential market entrant compete with you? It is the very nature of competition that pushes consumers to care about your product. Be ready to present the question to your market in your favorable terms. Let your competition do the spending for you.