The Wall Street Journal covers companies. Pirate Street Journal cover categories.
Each week, we pick three headlines worth paying attention to and break down the category underneath. Live every Tuesday at 7 am PST / 10 am EST. See the news through a different lens. Keep reading in the Deep Dive Reports.
Dear Friend, Subscriber, and Category Pirate,
Here’s what we covered in this episode:
1. Burger King fixed the product and the company. It never touched the category.
Burger King earned that. Look at the work:
It bought back its biggest franchisee, a company operating about a thousand of its restaurants, to get control of its own operations again. That is a company move.
It rebuilt the Whopper. New bun, new mayo, a box that keeps it hot, and the chef who developed the Popeyes chicken sandwich. That is a product move.
It retired the King mascot, cut the menu down, and launched “You Rule.” Company again.
The Magic Triangle says a legendary business designs three things at the same time: the product, the company, and the category the product lives in. Burger King nailed two and left the third blank. It is still selling burgers, in the burger category, against everyone else selling burgers. The only available win is being slightly better at the identical thing, forever.
Then there is In-N-Out. Family-owned since 1948, never franchised, never public, one of the shortest menus in fast food. Its secret menu (Animal Style, 4x4, protein style) is a fixed set of options, which lets super consumers, the small group of customers who buy the most and care the most, feel like insiders without slowing the line down by a second.
Ask a group if they want to go get a burger and you get a shrug. Ask if they want In-N-Out and you get an answer.
So what does this mean for you?
If your competitor is beating you, the instinct is to out-execute them. Better product, tighter operations, sharper ads. Burger King did all three and won a fight that does not change its life. Fighting for number two in a weak category is not a strategy.
2. Reddit is the last unpaid room on the internet, and brands are showing up with a wallet.
Reddit is now the most cited website in AI answers. When ChatGPT tells you which running shoe to buy, it is largely reading Reddit.
Advertising revenue on Reddit hit $762 million last quarter, up 64%.
So a category appeared. Agencies now sell brands 35 to 100 Reddit comments a month for $2,500. For $4,500 they will get negative posts removed or replaced.
Which means brands have decided complaints are a mess to clean up.
An angry customer is an engaged customer. Hate is love in motion. Make one furious Superconsumer whole, meaning the small group of customers who buy the most and care the most, and you get your loudest evangelist for the price of a refund.
And when people complain about your brand, they are usually complaining about your whole category. Netflix exists because everyone hated Blockbuster’s late fees. Keurig exists because office coffee sat on a burner going bitter all morning. A thread full of complaints is a category design brief written for free by the exact people who would pay you to fix it.
So what does this mean for you?
You do not need $4,500 a month to plant comments about your business. You need an afternoon reading what people already say about your category and the nerve not to argue with them.
3. Mascots that celebrate brands will fizzle, but can work if they focus on customer outcomes.
Crocs just introduced Niles, a six-foot crocodile that hatched from an egg on social. Liberty Mutual ran six characters and 160 ad concepts through Jim Henson’s Creature Shop to land on Liberty Biberty, a yellow ball of fuzz.
System1, a firm that measures how ads actually perform, says brands quit on a new character after twelve to eighteen months, right before the compounding starts. A mascot gets more valuable the longer you run it, which makes the asset the calendar, not the character.
Which is why the two smartest moves here are not new characters at all. Crocs has had a grinning crocodile in its logo since 2002, so Niles arrives with 24 years of recognition already banked. Liberty Biberty is named after a line an actor flubbed in an older Liberty Mutual ad. Both companies skipped the wait by animating something people already knew.
The mascot ladder. A mascot can point at four things, and the higher it points, the longer it pays.
Brand. The Aflac duck yells the company name at you. That is all it does.
Product. Snap, Crackle and Pop are the sound of the cereal in the bowl.
Category. Mr. Clean is what the entire cleaning category promises: strong, and it works.
Outcome. The Energizer Bunny is the result you actually want, a battery that does not quit. The Doughboy did the same job and then spent a decade as a rubbery toy on your grandmother’s fridge.
So what does this mean for you?
Before you commission a character, ask whether you will still be running it in three years when nobody has noticed, and whether you already own something recognizable you could animate instead of starting at zero.
3 conversations to have about the news with The Pirate Eddie Bot and The Pirate Christopher Bot
The bots run this week’s moves against your category. They come with the founding tier and they jam at 3am when you are the only one still thinking about this.
Audit your triangle before you audit your marketing. Give the bots your last four quarters of wins and ask which corner each one lands in. If the category column comes back empty, you are Burger King with a better bun.
Mine your complaints for the category, not the apology. Paste in your worst reviews and ask what category problem sits underneath them. Blockbuster’s late fees built Netflix.
Ladder your mascot, logo, or tagline. Ask the bots to place it on brand, product, category, or outcome, then ask what moves it up a rung. Aflac’s duck has been on the bottom for 25 years.
Not a founding member yet? You can join here.
New episodes drop every Tuesday: three topics, thirty minutes, a couple of bongos.
Our Deep Dive Reports go deep on one company or one shift, with the category read and the call attached. Founding Members get each one start to finish the day it drops, and everyone else gets the preview. Read the Deep Dive Reports here.
Arrrrrrr,
Category Pirates 🏴☠️
Eddie Yoon
Christopher Lochhead
P.S. - Every story this week came down to the same move: find the problem before you go shopping for a solution.
The Category Design Academy is where you do that at the category level. You name the problem only you can name, then design the category around it, so you stop competing on terms somebody else set.
The next cohort starts in October. Apply now to save your seat before it sells out.
