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In October 2020, a 10-second video clip sold for $67,000. Just recently, that same 10-second video sold for $6.6 Million. This selling of a piece of digital art changed the future… and most people didn’t even notice.

This new category design could have profound implications in the art world of art –  and soon, everywhere else! So in this episode, Christopher Lochhead talks about digital-exclusive products, how it can be the next mega-category, and how it can affect your business and brand in the future.

Prioritizing Your “Real Life”

As the age of digitization continues to evolve, people find themselves becoming more invested in their digital life. If you’re between thirty or thirty-five, you’re probably a digital native. Everyone below that are definitely digital natives: those who spend most of their time online and connected digitally.

The big AHA moment here for Christopher is that digital natives prioritize their digital life more than their physical life. It is almost as if their digital life is their “real life”, therefore it has more value for them.

“If you’re a digital native, the AHA here is your digital life is more important than your physical life. If you’re a digital native, you’re having the opposite experience that someone like me. Someone who believes my primary experience in life is a physical one, but it’s supplemented with a rich digital life. But if you’re my buddies and their kids, your real life is the digital life and the ocean and the sunset are an interruption to your real life. That was a profound moment for me. I understood at that moment the difference between digital natives and non-digital natives were 180 degrees different.” – Christopher Lochhead

Digital-Exclusive Products as a Mega Category

Digital products have been around for quite some time. There are games that sell digital clothes to make your avatar look good or play better. However, this 10-second digital media clip that sold for $6.6 million dollars in an NFTE auction classifies as category design.

This new art category design is changing the definition of the category of what it means to be an artist and what a piece of art means in the digital age.  Art is now a new digital category; it’s not only physical anymore. Who’s to say that other products won’t follow suit in the future?

“In the past, people would pay six point six million dollars for a painting, not a bunch of zeros and ones. This is a way bigger development than somebody paying a few dollars to buy a digital tractor or a rifle in a video game. Someone paid over six fucking million dollars for some zeros and ones, and those zeros and ones are artificially being restricted. In this case, they paid that money so they’d be the only people in the world to have those zeros and ones.” – Christopher Lochhead

All of these circle back to digital natives and how they prioritize things. It is why you see people being reluctant to buy a car but willingly fork over money for a digital vehicle in an app. They want to live out their best lives in their perceived “real life”.

“If you’re a digital native, your digital life by default is more important and more valuable to you than your physical life. If that’s true, it stands to reason that digital native’s want to buy shit for their digital native selves and they’ll buy things in their digital world that they wouldn’t buy in their physical world.” – Christopher Lochhead

Should You Ride the Digital Wave?

So what does that mean for companies and their corresponding categories and brands? Well, if you want to stay ahead of the pack, you need to step back and think about the increasing role of people’s digital lives in the market. Especially in the new marketing landscape that COVID has wrought, where people live in a digital workplace in a way that they didn’t before.

“I think we have to ask ourselves: is there an opportunity and or threat for our categories, brands and businesses in a world where people’s digital life is their primary experience and their physical life is their secondary experience?” – Christopher Lochhead

To know more on digital-exclusive products as a new mega-category, download and listen to this episode.

Bio

Christopher Lochhead is a #1 Apple podcaster and #1 Amazon bestselling co-author of books: Niche Down and Play Bigger.

He has been an advisor to over 50 venture-backed startups; a former three-time Silicon Valley public company CMO and an entrepreneur.

Furthermore, he has been called “one of the best minds in marketing” by The Marketing Journal, a “Human Exclamation Point” by Fast Company, a “quasar” by NBA legend Bill Walton and “off-putting to some” by The Economist.

In addition, he served as a chief marketing officer of software juggernaut Mercury Interactive. Hewlett-Packard acquired the company in 2006, for $4.5 billion.

He also co-founded the marketing consulting firm LOCHHEAD; the founding CMO of Internet consulting firm Scient, and served as head of marketing at the CRM software firm Vantive.

We hope you enjoyed this episode of Lochhead on Marketing™! Christopher loves hearing from his listeners. Feel free to email him, connect on Facebook, Twitter, Instagram, and subscribe on Apple Podcast! You may also subscribe to his newsletter, The Difference, for some amazing content.

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This episode talks about the Category Design Scorecard and how you can use it to spot a Category Designer. It also breaks down how you can evaluate a company’s ability to create a new category or redesign an existing one.

Christopher and his Category co-pirates, Eddie Yoon and Nicholas Cole, just unveiled this new Category Design Scorecard. It is based on a tremendous amount of primary research, and they can’t wait to share it with all of you.

How the Category Design Scorecard Came to be

The episode starts off by explaining why they created the Category Design Scorecard. Christopher, Eddie, and Nicholas wanted something that can distinguish a company that is a category designer or creator from a high growth company fighting tooth and nail for market share in their existing category.

We analyzed Fortune magazine’s 100 fastest-growing companies list for over a decade. Were there certain things that companies are trying to design and dominate a new category? They were easily distinguishable from other high growth companies due to certain things they said. So we picked the Fortune 100 fastest growers list over a decade. What we discovered as we began to dig into the data are five key indicators. Those five key indicators distinguished category designers from other successful companies. – Christopher Lochhead

The Five Components of the Category Design Scorecard

Christopher then enumerates the five components of their new Category Design Scorecard, and they are as follows:

1. Category POV

Does the company have a clear “Point of View” of their category?

Are they able to frame a powerful problem, articulate a compelling vision, and most importantly, communicate the core compromises, trade-offs, and problems inherent to the way the category is today, but in such a way that the consumer/customer will be open to a new and different approach.

Category designers have a very specific way of doing it; which is they are going after something that they see as a noble cause, a noble purpose, or a giant problem worth solving. It’s either a problem that we didn’t know that we had, that they’re educating us about, or it’s an existing problem that they meaningfully reimagine it in a new context. – Christopher Lochhead 

2. Future Category Reimagined and Without Compromise

Does the company cast a compelling future — free of any fundamental problems, compromises, and trade-offs inherent to the category as it is today?

We’ve learned a lot from our friend Joe Pine, who is one of the co-authors of The Experience Economy. One of the things that he teaches us is that companies that are successful in doing this transform their customers, transform their partners, and as a result of bringing new things to the world, they generate a tremendous amount of abundance. So the second criteria is, are they articulating a future category in a reimagined way without compromise? If they do, can the future category break new grounds and get us an exponential kind of future? – Christopher Lochhead 

3. Radically Different Offer + Business Model

How does this new category get delivered to the customer? Is it both through a breakthrough product/service/offer, but also through a breakthrough business model?

How does product innovation and business model innovation come together in a way where 1 + 1 = 11? 

There has to be something radically different about either the product offer, the business model, or both. – Christopher Lochhead 

4. The Data Flywheel

Does the company generate data about customer/consumer with demand/preferences that creates a unique opportunity and advantage to anticipate the future of consumer demand and any category shifts?

Will this Data Flywheel provide insight into not only how to improve company offerings, but predict where demand for this new category will unfold next?

One of the big insights in Superconsumers is a relatively small percentage of the most enthusiastic consumers are customers that drive any category change. So another thing to think about is, does the flywheel produce insights into Superconsumers, and not just everyday customers? This allows a company to be very predictive about going forward. – Christopher Lochhead  

5. Depth & Degree of Customer Outcomes

Does the company generate satisfied customers/consumers?

Are customers so happy and satisfied they evangelize the product/service to others? Better yet, do customers want to tell their own stories where the customer’s life is truly different after engaging with the company?

The degree to which a customer has a massive outcome, particularly an outcome that drives massive word of mouth. When your outcome drives word of mouth, and you have a compelling category point of view, you’re actually telling your customers what to say as they go share it with their friends.– Christopher Lochhead  

To know more on how the 100 fastest-growing companies fare in the Category Design Scorecard, download this episode.

Bio

Christopher Lochhead is a #1 Apple podcaster and #1 Amazon bestselling co-author of books: Niche Down and Play Bigger.

He has been an advisor to over 50 venture-backed startups; a former three-time Silicon Valley public company CMO and an entrepreneur.

Furthermore, he has been called “one of the best minds in marketing” by The Marketing Journal, a “Human Exclamation Point” by Fast Company, a “quasar” by NBA legend Bill Walton and “off-putting to some” by The Economist.

In addition, he served as a chief marketing officer of software juggernaut Mercury Interactive. Hewlett-Packard acquired the company in 2006, for $4.5 billion.

He also co-founded the marketing consulting firm LOCHHEAD; the founding CMO of Internet consulting firm Scient, and served as head of marketing at the CRM software firm Vantive.

We hope you enjoyed this episode of Lochhead on Marketing™! Christopher loves hearing from his listeners. Feel free to email him, connect on Facebook, Twitter, Instagram, and subscribe on Apple Podcast! You may also subscribe to his newsletter, The Difference, for some amazing content.

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Stories are incredibly powerful. It is legendary. People fall in love based on the stories they tell themselves about each other. People go to war and start countries over stories. Furthermore, when stories are used to design a category and a brand, it creates massive enduring value.

In this episode of Lochhead on Marketing, we talk to the guru of the business of story himself, Park Howell, to educate us on how to construct legendary marketing stories and how story marketing and category design actually come together. Park also shares his fantastic thoughts on nursery rhymes and the Gettysburg address.

What Marketers Get Wrong About Storytelling

Most marketers are not award-winning screenwriters, they’re not great at long-form content like in Hollywood and Pixar. Park discusses how marketing comes down to just three words, one framework that is built on: and, but, and therefore (ABT). This perfect three-act structure is a complete customer framework that will allow the connection to the customer on an empathetic level and help develop the contrast in their problems.

“I’ve learned that this framework hooks the subconscious of your audience, which is always looking for this fight or flight. It’s a problem-solution dynamic that you are playing to the natural way your audience’s brain creates meaning. Now what a lot of people do is they start with the problem in the ‘and’ statement. Start with the aspiration, what is it that your customer wants and then insert the problem in your ‘but’ statement. Therefore, here’s my solution on how to help you get that. And the trick here is to have as much contrast between that aspiration and that problem as possible. A short, succinct, and specific contrast. If you do that, your audience will give you all the time you need in your therefore solution.” – Park Howell

How to End Up with A Captivating Story

Park encourages everyone to start in the middle through the ‘but’ statement and then proceed to answer the singular problem that needs to be solved. Once the singular problem is determined and boiled down, then jump to the ‘and’ statement, the specific audience, and lastly the ‘therefore statement’. Following the ABT framework can lead to amazing and captivating brand and founder stories.

He discusses that when somebody articulates the customer’s problem powerfully and effectively, the human brain makes the assumption that the person by definition must have the solution.

“A good story can kill a bad product quicker than anything. If you’ve got a great founder story, well told that has nothing to do with the product or offering, you create a disconnect there. There are a ton of those stories out there that have gone untold, and they are like gold sitting below your feet. You just have to unearth them and tell them well, but it has to tie to your why it is you do and what you do in your business. Huge believer in that.” – Park Howell

How Story Marketing and Category Design Unite

Christopher and Park discuss how to create legendary stories in context to the use of category design. Park comments one can do this by getting the ABT super focused so nobody can share the same ABT. Along with a little shadow on the category design, this little algorithm tool can help separate and differentiate from the competitors. 

Park also discusses how the Gettysburg address and nursery rhymes all used ABT in their brilliant storytelling. 

“If you go to the Gettysburg address, you’ll see the Gettysburg address is a perfect and, but, therefore. Lincoln steps on stage and addresses the GRA crowd. Exactly two minutes, 272 words. Yet it’s one of the most iconic, legendary leader addresses of all time. If you look at it, it’s set up in a perfect and, but, and therefore for him to give. He was just a brilliant storyteller. He knew the power of contradiction and consequence, and that’s what he was delivering that day. If you look at any nursery rhymer, most 90% of all nursery rhymes are an ABT.” – Park Howell

To know more about Park Howell and how to construct legendary marketing stories, download and listen to this episode.

Bio: 

Park Howell is a 30+ year veteran of the advertising industry who has guided hundreds of purpose-driven brands and thousands of people who support them to substantial growth.

But everything changed in 2006. That’s when he realized the advertising paradigm was being disrupted by the internet. Brands used to own the influence of mass media, but the masses had become the media creating a cacophony of communication.

Park learned that an anecdote is the antidote to help you stand out.

He now consults, teaches, coaches, and speaks internationally helping leaders and communicators rise above the noise of the Attention Economy and be heard using the power of the brand and business storytelling.

Many so-called storytelling experts tell you why story is important in business. Park actually shows you how to storytell.

Audiences are bewitched by his interactive keynotes, panel discussions and workshops.

Links:

Website: Park Howell

We hope you enjoyed this episode of Lochhead on Marketing™! Christopher loves hearing from his listeners. Feel free to email him, connect on Facebook, Twitter, Instagram and subscribe on iTunes! You may also subscribe to his newsletter, The Difference, for some amazing content.

***

Following an exercise out of Lochhead’s playbook (we’re always on the lookout for new ways to make our Story Cycle system more powerful for brands that choose to leverage it), we arrived at the ideal market category design for their new product.

Here is the script we created to design their new category:

How many times do you breathe each day?

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WebMD lists 34 side effects to common allergy meds, including dry mouth, drowsiness, itching, irritability and nightmares.

But they don’t mention what other studies have found. 

That prescription and OTC allergy drugs can lead to cognitive impairment. 

Including a lowered IQ and potential increases in dementia and Alzheimers.

When it comes to understanding the true impacts of allergy meds, Americans are suffering from a severe case of…

…Mental mucus. 

UNTIL NOW!

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On this episode, let’s talk about producing legendary results in the context of CMO tenure. According to the Wall Street Journal, based on research from Spencer Stewart, the median tenure of a CMO was only 27 and a half months in 2019, which was down from 31 months in 2017. This is in stark contrast to the CEO’s average tenure of 88.4 months or about seven and a half years. CFOs have roughly 63 months or nearly five and a half years.

Success is about producing legendary results. So on this episode, let’s talk about that.

Marketing Is A Constant Revolving Door

One legendary marketing consultant in Silicon Valley and friend of Christopher says that marketing is now a constant revolving door. CMO tenure is down to more or less two years and across all levels in the marketing department. Covid-19 made matters worse and we ask, what is driving this “revolving door”?

“One of them is, everybody in marketing is very busy all the time, very frenzied in a stimulus-response like we’re trying to win the activity contest. Success in business is not about winning the activity contest. As a matter of fact, activity does not equal to results. So yes, shave the dog.” – Christopher Lochhead

Results Do Not Equal No Results Plus An Excuse

The big aha here is results do not equal no results, plus an excuse. Christopher describes sales as binary, you either hit the numbers, exceed the numbers or do not hit the numbers. It is the sole indicator that you are doing well, but this should not be the case for marketers.

“As a CEO, you live and die by the numbers. Every quarter, as the head of sales, chief revenue, officer, VP of sales, whatever title it is, head of sales, that’s true too. The reality is, that should be true in marketing as well. This sort of leads us to the question, what are the marketing results that matter?” – Christopher Lochhead

Marketing Results That Matter

There are lots of things that marketing do so in this episode, Christopher discusses the results that matter. There are only three things that marketing organizations should be focused on: 

“Number one, design and dominate a category that matters. Number two drive revenue near term midterm and longterm. And number three, create enduring value as measured by market cap or company valuation. We want to be creating the most valuable company in a category that matters.” – Christopher Lochhead

To know more about the three marketing results that matter, download and listen to this episode.

Bio:

Christopher Lochhead is a #1 Apple podcaster and #1 Amazon bestselling co-author of books: Niche Down and Play Bigger.

He has been an advisor to over 50 venture-backed startups; a former three-time Silicon Valley public company CMO and an entrepreneur.

Furthermore, he has been called “one of the best minds in marketing” by The Marketing Journal, a “Human Exclamation Point” by Fast Company, a “quasar” by NBA legend Bill Walton and “off-putting to some” by The Economist.

In addition, he served as a chief marketing officer of software juggernaut Mercury Interactive. Hewlett-Packard acquired the company in 2006, for $4.5 billion.

He also co-founded the marketing consulting firm LOCHHEAD; was the founding CMO of Internet consulting firm Scient, and served as head of marketing at the CRM software firm Vantive.

We hope you enjoyed this episode of Lochhead on Marketing™! Christopher loves hearing from his listeners. Feel free to email him, connect on Facebook, Twitter, Instagram, and subscribe on Apple Podcast! You may also subscribe to his newsletter, The Difference, for some amazing content.

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In this episode, let’s talk about one of the dumbest social media marketing lies out there: you have to be everywhere on every platform and you need to put out a hundred pieces of content today. This is terrible advice and it will exhaust you and your marketing team and will piss off your prospects and customers. Ultimately, it will not help you become a category queen and king.

Bio:

Christopher Lochhead is a #1 Apple podcaster and #1 Amazon bestselling co-author of books: Niche Down and Play Bigger.

He has been an advisor to over 50 venture-backed startups; a former three-time Silicon Valley public company CMO and an entrepreneur.

Furthermore, he has been called “one of the best minds in marketing” by The Marketing Journal, a “Human Exclamation Point” by Fast Company, a “quasar” by NBA legend Bill Walton and “off-putting to some” by The Economist.

In addition, he served as a chief marketing officer of software juggernaut Mercury Interactive. Hewlett-Packard acquired the company in 2006, for $4.5 billion.

He also co-founded the marketing consulting firm LOCHHEAD; was the founding CMO of Internet consulting firm Scient, and served as head of marketing at the CRM software firm Vantive.

Links:

Legendary copywriter Ben Settle

Category King of History Podcasts Dan Carlin

We hope you enjoyed this episode of Lochhead on Marketing™! Christopher loves hearing from his listeners. Feel free to email him, connect on Facebook, Twitter, Instagram, and subscribe on Apple Podcast! You may also subscribe to his newsletter, The Difference, for some amazing content.