Warning: do not attempt this unless you REALLY need to as there are many other lower risk things that you can do to effectively position the company and create a consistent messaging platform.
OK–you still want to do it? Then I’ll give several first-hand examples of category creation strategies with some background context.
1. Avoid the category. Enigma, Inc. (yes I regret that I didn’t push to rename the company) creation of the Support Chain. i2 does supply chain, Enigma does support chain was our pre IPO pitch. That’s what you do with a unique vertical solution when you don’t lead the horizontal spaces that you play in. We weren’t the leader in content management, ecommerce or parts catalogs but we had all three and a clear market focus.
2. Aggregate and elevate the category. Combine CAD, CAM, CAE, PDM, AMS into PLM or product lifecycle management. PLM got us a seat at the table with CRM, ERP, SCM as CIO level issues. This was required because most knew our product, Pro/Engineer, much better than our company, PTC. To do this we needed to drop the custom term (Collaborative Product Commerce) that Gartner helped us create, then copy our biggest competitor (who was using PLM), get our other big competitor on-board (EDS) and then go tell the analysts that three of four big boys are calling it PLM so you should too. That worked great and is still working.
3. Extend the category. Clearforest did text analytics for advanced discovery. Our problem was that we always ended up in the knowledge management space facing competition from all the search engines and content management vendors. To get out of our box, we promoted Unified Business Intelligence (UBI) which put the ‘why in BI’ by adding text analytics to data warehouses.
4. Position in multiple categories. At Platform Computing, we were in the top five players for Clusters, #1 in Grid, and amongst hundreds in Cloud. The solution: Platform Clusters, Grids, Cloud, Whatever Computing That did a nice job of celebrating our history in HPC clusters and grids while being forward leaning for cloud computing and also to highlight our skepticism to any buzz-word. By adding 17 years, 2000 customers….we established credibility. This approach also gave us the ability to add a tagline ‘Optimize Infrastructure for Scale’ as an action-oriented saleable value proposition.
5. Ignore the category. At Symyx, we sold to R&D managers who did not generally recognize or care about IT categories as much as they cared about the specific relevance of the solution to their science. Our identity as an ‘R&D Integration Partner’ (IBM for chemistry) and our brand promise of ‘Accelerate R&D Certainty’ gave use clear differentiation from point software, instrument and service solutions.
When thinking about your space or category, consider the following:
- Share and position within the category. If you are #1 or #2, you have a vested interest in market development and category promotion.
- Amount of evangelical selling required. The more required, the more important the category.
- Enterprise or point product. Segue sells a revolutionary point product, do they need to create ‘the human transponder’ category? I don’t think so. If its a point product worry less about the category and more about branding the product.
- The competitive landscape as it relates to the portfolio of categories. Cloud computing is an aisle with lots of confusing categories. The spirits aisle is simpler with wine, beer, liquor. If you are in a confusing aisle, category creation is much harder. Hard cider in the beer section or wine section? That’s an easier problem.
- Amount of resources the company can spend on awareness and the amount of value category leadership provides to investors. Don’t throw pebbles into the grand canyon by doing market development when you should be focused on basic marketing–let the big boys and pundits do their work and draft off it.
- Size of your target audience. At Enigma, we had a very defined market segment, which makes it easier to be in the market development game.
- Stage of the market and/or category. Good luck re-defining the server market. Challenging the server market with VMs, GPUs, Cloud, now that’s a different story.
Category leadership and/or challenger positioning to existing categories is critical for communicating your brand promise and value. Done properly, it makes all ‘downstream’ marketing and selling activities easier. Done poorly, it is at best confusing and at worse crippling.