Reilly Newman | Every business leader wants their service or product to stand out from the rest. To win in your competitive marketplace, it makes sense.
The commonly neglected cornerstone of how to truly differentiate is one that will help your strategy come to fruition. This first initial step is called “categorizing”. This is the category in which your business model has been born and raised. Sounds simple enough, right? Good.
Making your category apparent to your audience is key for them being able to create an association and therefore latch onto some type of basic value you deliver. The unfortunate thing that happens when businesses try to differentiate, they throw the baby out with the bath water and skew too far from the established (and familiar) category in which they dwell.
If an audience miscategorizes a business or cannot categorize it then it will exhaust the viewer and they will move on rendering the business to forever sit in an undefined grey area where no initial value exists. Rest in peace.
(NOTE: With the right capital and resources a new category can be created by a business. Doable if you like a lot of risk, burning cash, and getting timing correct.)
For 99.9% of businesses, they have self-declared their category simply by generating revenue. If you make money, there is an obvious demand for your product or service. And unless you are an inventor, this demand means there is a general category.
The elements of associating your business model with a familiar industry(category) are as follows:
• The audience is able to grasp what you offer.
• The audience is able to grasp baseline value due to category experience.
• There is a clear understanding of what is acceptable and what is taboo for your industry.
• There are established norms and category “culture” for both behavior (Community)
• There are established bounds for pricing (Glass ceiling)
• There are established expected deliverables. (Standardized)
• and much more…
Brand Category
The main elements listed above is where opportunity exists.
Similar to how Apple entered the infantile computer industry, how Tesla entered the EV market, or how Nike entered the athletic shoe industry. They claimed their category then gave it a twist.
A computer company that is design and user focused.
An EV car company that designs cars that look elegant.
A athletic shoe company that connects with pro athletes.
The twist is where brand allows the business model to go far beyond the established elements of the given category. When there is brand it empowers the business to say “yes, you know those other guys, well we do that but we (insert twist)” — this creates differentiation, it creates conversation, it creates story, and most importantly it increases perceived value.
