What do Uber, Apple, and Under Armour have in common? What makes them such successful brands? The answer: category creation.
What It Is
Category creation is a management strategy that focuses on creating new categories of products or services. Instead of competing with other brands, category creators develop a whole new market they then dominate. You could think of it as disruptive innovation—presenting a novel and unique solution to a problem most people never even thought they had.
Take Uber as an example. It is an on-demand ride-hailing app that solved a problem the market did not think existed before: the need for more convenient and better taxi systems. Before Uber, people simply accepted that hailing a cab was one of the things they had to endure every day. So when Uber showed up, everyone unreluctantly flocked to it, even drivers. Instead of starting a new cab company, Uber created a whole new category of service that utilized technology to solve people’s problems with hailing cabs. Now, a lot of other companies have followed suit.
Why Category Matters
The effectiveness of category creation lies in the human psyche. Human beings prioritize categories first before brands. In other words, brands do not matter unless the person cares about the category first.
For instance, Under Armour does not matter to someone who does not participate in sports, just as the brand Thinx probably does not ring a bell for people who do not menstruate. Interest in a category is what drives people’s interest in a brand.
That’s why when it comes to marketing, category creators market the value of their category first before their brand, which is not the same as neglecting their brand. Rather, by presenting how their category evolved from the original product and how it brings better benefits or experience, they are cementing the value of their product to their brand.
Why It Pays To Be A Category Creator
Being a category creator is not about changing the way the game is played. Instead, category creation is about coming up with a new game, making your own rules, and positioning yourself as the top player. Being a content creator requires guts on top of creativity. But why should you, an entrepreneur, become a category creator?
You are creating a new category, a new niche for yourself, so there are few to no competitors for what you are doing. You don’t need to position yourself against other brands. You merely need to market your category.
Automatic Value Assignment
When you create a category for something that people already care about, you are assigning value around your product instead of on your brand. Being able to assign high value to your category gives you more leverage and growth potential.
You Become A Pioneer
You present your brand as a unique innovator, which automatically makes you a pioneer. Although you are a new entrant, you are not competing with already established brands, so you won’t be compared with anyone else. You alone bring value to the market you yourself created.
You Are Likely Addressing A Niche Market
When you create a category addressing a new problem, chances are that you are meeting the needs of a small group that is already aware of the issue. You present a solution to a problem that has not been addressed until now. Catering to a niche market brings loyalty and revenue.
It Comes With A Hot Marketing Strategy
Category creation is its own marketing strategy, which is one of the most compelling things about it. As a category creator, you don’t need to spend the same effort on marketing as everyone else because your product practically markets itself.
Category Creation As A Marketing Strategy
Yes, you read that right—creating a category is its own marketing strategy. Category drives people’s interest. When you create a new category around something that people care about, you create value around your brand. What’s more, you don’t need to convince the market that your product will solve their problems or that it is worth checking out. People will notice that immediately and respond to your category.
With the value attached to the category you created, people will assign the same category to your brand. From there, it’s just a matter of keeping the value with your brand, especially when new brands emerge in your category. But even when they do, you are already at an advantaged position as the pioneer in your category. You’re the new Coca-Cola, Uber, Under Armour, or Thinx.
The greatest characteristic of any successful entrepreneur is their ability to solve problems people were not even aware they had. Category creation is for those entrepreneurs who not only have the brains to develop innovative solutions to issues but, more importantly, have the guts to create a whole new category of products or services as well. You can learn more about building a category by listening to Christopher Lochhead’s podcast.