Category Creation Book Review
When a business is on the verge of launching a new product or service, they are often met with the struggle of defining exactly what market category it belongs to, and seek guidance from analysts or other existing players within the same industry. However, their suggestions might fall short of your vision, future plans, and miscommunicate the significance of the problem your product or service solves.
This predicament can lead to the spark of a movement – the creation of an entirely new market category.
In the book, Category Creation, by Anthony Kennada does an excellent job at explaining how to tell whether you’re creating a category early on, as well as outlining the proper way to address your business goals and plans to achieve category greatness. It’s a three-part manual teaching everything you need to know about category design, interlaced with lessons and examples from some of the most successful category leaders out there to really put the magnitude of this emerging business strategy into perspective.
According to Kennada, category creation “has become one of the hottest topics in business, and for good reason, as there’s no strategy quite like it that can result in both commanding market leadership for the company on top, and incredible fulfillment for the customers, employees and investors along for the journey.” In his playbook, he lays out the blueprints for starting and growing a conversation that doesn’t exist yet and leveraging practical strategies to launch your product or service into a new market.
Category creation is not necessarily something that entrepreneurs, executives, or marketers set out to achieve initially. In many cases, the need for an entirely new market category is discovered along the journey of building a business – through patterns and observations of a unique, but common problem that nobody has had an “aha!” moment about yet. Upon discovery of this unmet need, a category is born and a company is on its way to dominating it.
In Part I of his book, Kennada demonstrates that despite the ‘happenstance’ nature of category creation for iconic brands, such as HubSpot, Gainsight, and Salesforce, there is some method to the madness. He expands on the seven principles of the marketing strategy that goes into designing and dominating a category in Part II.
A common thread throughout the book is the importance of a brand’s values. Kennada explains that the B2B and B2C contexts that we have all become accustomed to are beginning to merge. In other words, the rise of inbound marketing, software as a service, and customer success methodology has opened the eyes and minds of marketers to an obvious truth: on the other end of every transaction is a person.
This shift in context paved the way to a more effective, human-centric approach to growing a business. Kennada refers to this new era of marketing as Business-to-Human (B2H), which is the central theme of his work and a powerful concept.
It doesn’t come as a surprise that Kennada, who was Chief Marketing Officer of customer success giant Gainsight when he published the book, would describe the importance of building a human-first community so effectively. He is credited with the creation of the Customer Success category by identifying the gap that existed within this category and leading with the problem with a unique point of view and through effective content marketing, live events, and innovative activations. His success with Gainsight is proof that establishing human-first values and building the right culture are two of the driving forces behind becoming a “category defining” company.
The B2H perspective applies not only to the internal culture and environment of a company that has a great impact on employee recruitment and retention, but also to the manner in which a team engages with the customer to validate, shape and accelerate the interests of the category. Kennada establishes that you cannot rely on analysts or companies to build a category, but rather categories are built by customers.
With focused efforts on activating your customers, or turning them into category ambassadors, they will drive the growth of your business and position your brand as the leader of your category. And in order to activate customers, it is essential to build trust at scale through the use of authentic, human-to-human communication. Customers of the digital age are more likely to stand behind a category that they believe in and admire.
Another principal aspect that Kennada’s playbook establishes is the fact that category design isn’t exclusive to start-ups. Some of the largest enterprises in the world can leverage these strategies and their own advantages to create new categories and cultivate leadership within them.
The last few chapters of Category Creation give readers a glimpse into the common outcomes of creating a new category and how to convince others of the brilliance of your discovery. With every new category comes a learning curve for the builders, customers, and investors alike. It can take time – and a lot of it – to overcome this learning curve. Kennada offers insight into how to use behavioral scoring and lead nurturing tactics to make sense of your database and uncover buyer intent for your products – which will help you spend less time in the early stages of your category design process.
We’ve entered a new era, a ‘digital gold rush’ in which companies have the opportunity to develop simple solutions for complex processes of the past. Startups and large enterprises are realizing that there is a better way to get to the top than disrupting a market or reinventing a product or service within that market. Category creation holds the highest of power when it comes to determining value in a business.
Category Creation vs. Category Design
Creating and dominating a new market category is no easy feat, however. Kennada’s book Category Creation provides powerful guidance for understanding how to achieve it and knowing whether it is working or not. The book focuses less on the category design process, which a CEO might lead and more on the tactical, which a CMO definitely leads.
It takes a whole lot of courage to create a market around an observable problem that so many people have experienced, but have never before paid attention to in a solution-driven way. According to Kennada, if you and your team have the courage to overcome the challenges and a “change the world” idea that is worth the uphill battle, you might just have what it takes to design and dominate a new market category.