Messaging and positioning
How do you think about the relationship between product positioning and category creation? When is it worth trying to define a new category?
A category is the widest frame of reference a position can use. Create a new one only when the existing frame misleads buyers, when they already describe the problem in words that have no home, and when you can afford years of teaching the market.
Otherwise win inside the current category by changing the comparison, or name a subcategory first and watch whether buyers and peers repeat it.
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How a category relates to positioning
Positioning picks a frame of reference, the thing buyers should compare you with. A category is the widest frame available. So category creation is a positioning decision with a large bill attached.
Answers often treat it as ambition. Interviewers usually hear it as cost. Education, content, analyst time, and years of patience, all spent before buyers have a budget line for the thing you named. The strong answer shows judgment about when that bill pays off.
Four tests before naming a new category
- Does the current frame hurt? If buyers file you under an existing category and you look thin or wrong there, a new frame might help.
- Do buyers already have the words? Look for people describing the problem in language that has no category home yet.
- Can you afford the teaching? Count the content, analyst work, and time before buyers budget for it.
- Could you win without it? Changing the comparison inside the existing category is cheaper. If that works, do it.
The fourth test is usually decisive. Most products can win inside an existing category by choosing a different comparison, and the ones that need a new frame tend to show it through buyer language first.
Deciding whether approvals software needs its own category
“I treat a category as the widest frame a position can use, so the question is whether the existing frame hurts us. We automate internal approvals, purchase requests, contract sign-offs, access requests. Buyers file us under project management, where we look thin next to twenty tools with boards and timelines. That’s a sign a new frame might help. Before trying it I’d ask three things. Do buyers already describe the problem in words that have no home today? Can we afford a couple of years of teaching the market? And could we win inside the existing category by changing the comparison? Usually the answer to the last one is yes, so I’d start with a subcategory, approvals for operations teams, and watch whether buyers repeat it back on calls. If they do, and people outside the company start using the phrase, such as analysts and peers in communities, I’d invest in the bigger category.”
The phrase about outside use matters. A category exists when other people say its name without you in the room. Until then it is a label.
Trade-offs in defining a category
- Leading the category versus paying for it. The creator often educates the market and a follower collects. Say how you would keep the lead once rivals adopt the term.
- Search demand. A new name has no search volume. You give up existing demand while you build new demand.
- Sales cycles. Buyers without a budget line take longer. Plan for it.
- Internal patience. A category takes years. Leadership has to accept slow early results.
On strategic thinking, the Exceptional answer names the timing window. A shift like a new regulation or a platform change can make buyers ready for a new frame all at once, and that is when the cost of teaching drops.
Where category creation answers go wrong
“Positioning is how you differentiate, and category creation is defining a whole new market. It’s worth creating a category when the product is unique, because then you can own the space and set the rules.”
It defines both terms correctly and treats uniqueness as the trigger. Almost every founder believes their product is unique. Fix it with the tests, especially whether buyers already have the words and whether you could win in the current category for less.
Follow-ups on category creation
| Follow-up | What they’re after | How to answer |
|---|---|---|
| How do you tell a category from a marketing label? | Rigor | Others use the name without you, including buyers, analysts, and competitors. |
| Who else has to adopt the term? | Market understanding | Buyers, analysts, the press, and ideally a rival or two. |
| What would make you abandon the attempt? | Discipline | No growth in outside use of the phrase after a set period, and buyers still comparing you with the old category. |
| How long does a category take to pay off? | Realism | Years, not quarters. Say what early signal would justify the next round of investment. |
More questions in this category
Frequently asked questions
- Is category creation only for startups?
- No. Larger companies do it too, often by naming a subcategory inside their existing market. It costs more than most teams expect at any size.
- How do you show buyers are ready for a new category?
- Look for buyers describing the problem in their own words, rising search interest in the phrase, and analysts or peers using it without prompting. Two of those together are a stronger case than any one.
- Can a subcategory grow into a full category?
- Sometimes. If buyers start dropping the qualifier and using your phrase on its own, the subcategory is becoming a category. Treat that as the signal to invest more.
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