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What is Category Design in Marketing

Marketing has been a competitive challenge for many businesses and not only is it about beating the competition, but you also have to be unique in your approach and innovate in ways that you are better than the rest.  This marketing strategy is known as category design, a business strategy that allows businesses to create and develop new categories of products and services.

Product category design entails designing a unique and legendary product and an effective and unique business model to deliver the product.  The article will explain and provide some examples of how to implement category design in order to succeed in a competitive market.

Category Design

Category design is the strategy of creating and monetizing new markets in a competitive industry.  The goal of category design is to create your own niche by identifying a problem and solution to gain the interest of your customer.

Innovators who practice category design educate the market about why they should consider doing things in a new and different way.  Innovative language may be used to market a new point of view to lead customers on how to think about a problem differently and adopt new approaches.

Steps to category design may include:

  1. Designing a unique innovative product
  2. Design a company and business model
  3. Design or re-design a market category

Category design is a strategy for positioning a company to become the leader of a new space in a new or existing industry.

It is about playing bigger to become the king of the industry and introducing new ways of thinking, a new practice, adoption, and taking market share by replacing it with obsolete methods of business.

Examples of Category Design

Some examples of category design include the following scenarios:

Henry Ford introduced to the world that horse-less carriages were a better form of transportation.

Clarence Birdseye introduced frozen food as a way to provide fresh-tasting vegetables in the winter.  People originally preferred to eat fresh food when possible, so the idea of buying frozen food was a hard sell initially.  In 2015, the parent company was sold for $2.8B and Clarence is now thought of as the founder of the modern frozen food industry.

Spanx founder Sara Blakely established a billion-dollar company with “shapewear” in a saturated and competitive undergarment market

Salesforce.com founder Marc Benioff used his cloud-based CRM software to educate buyers about the evils of “on-premise” software and the advantages of “cloud computing.”

Blockbuster, a brick-and-mortar video rental store, was the king of movie rentals for over a decade.  Netflix, however, began offering door-to-door mail-order delivery changing the movie rental industry.  The former Blockbuster CEO did not see this to be a big deal and, famously missed out on an opportunity to acquire Netflix.  Netflix executed category design perfectly and took out Blockbuster with its streaming-media platform.

Main Benefits of Category Design in Marketing

Following are some big advantages of category design:

Understanding your Space

In traditional marketing, you’re likely learning from and following in the footsteps of existing brands. You are just a game player, not a game-changer or innovator.

In category design marketing, you are the creator of your space and probably understand it better than anyone. You are the first to attract a new and targeted audience building loyalty before anyone else.

You Learn How to Be #1 in your Space

Leaders who are able to innovate a new space capture 76% of the market capitalization in their industry.

If you want to do well in a market, get in early, and to dominate a market, create it first.

Attract New Audience

The one thing that successful category design marketers have in common is they presented consumers with a new solution that they didn’t even know they needed.  Some examples of these types of innovators include Uber, Airbnb, Amazon and Apple.

Category design makes consumers adopt new solutions and take on a new way of doing things, creating loyal product believers.

Originally posted 2020-03-13 05:54:58. Republished by Blog Post Promoter

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