Buried Treasure: Category Design Lies

Everything is the way it is because someone changed the way it was.

Sep 14, 2022

Dear Friend, Subscriber, and Category Pirate,

This week’s Buried Treasure is all about Category Design Lies.

In case you missed these mini-books, here are 3 especially worth the time that debunk common lies around branding, product, and creating differentiated categories.

And to uncover more gems (our archives are deep!), hop aboard The Pirate Ship and subscribe below:

The Big Category Lie: 8 Reasons Category Creation Is A Bad Idea

Most people believe Category Design is who-ha, malarkey, and/or B.S.

Which is why, in The Big Category Lie, we wrote about the 8 reasons why people believe Category Design doesn’t work (and explained that these excuses aren’t true).

For example:

#1: “You can’t create demand out of thin air.”

Except everything is the way it is because someone changed the way it was.

In 1997, there was zero demand for “the Cloud.”
In 1998, there was zero demand for “Athleisure.”
In 2004, there was zero demand for “Energy Shots.”
In 2009, there was zero demand for “Cryptocurrencies.”

The entrepreneur, the creator, and the business owner had to create demand—and move the world FROM the way it was TO a new and different way.

#2: “It’s too expensive.”

The easiest way to sell a $3,000 watch is to put it beside a $30,000 watch.

“Expensive” is relative, and 100% based on context.

According to Crunchbase, the average American venture-backed company raised $300 million by their series D financing in 2021 (up from approximately $194 million in 2020). So it turns out, building a startup in America is “expensive” no matter which way you slice it.

Whereas the cost of Category Design is actually radically low when compared to legacy marketing strategies. (Like spending a gazillion dollars trying to convince people to buy your CPG product vs someone else’s—just to improve profitability by 1%.)

#3: “It’s not about categories. It’s about communities.”

What makes a community valuable isn’t the number of people. It’s the shared POV.

If you want proof, go search #NFTcommunity on Twitter.

What marketers, founders, and even very intelligent investors don’t seem to realize is that projects like CryptoPunks or BYAC didn’t become successful because they had a bunch of people in a Discord channel.

They became successful because they created new categories for themselves.

#4: “People don’t like change.”

If people don’t like change, then…

How come we all watch Netflix today instead of cable television?
Why do most of us shop online today instead of in stores?
Why do coffee shops today carry Almond, Oat, and Flax milk instead of regular milk?

The truth is, consumers love change. Which is exactly what Category Design is: the business strategy of changing people’s minds.

Uncover 4 more reasons in The Big Category Lie.

The Big Product Lie: Why Minimum Viable Product, Product-Led Growth, And Product-Market Fit Are Myths

In The Big Product Lie, we take on the lie perpetuated from Silicon Valley to startup hubs all over the world: “The best product wins.”

Because guess what? The best product does not always win.

Unfortunately, startup founders, executives, investors, and even artists like to believe the opposite: “Our product is so good, we don’t even have to do marketing.”

So we dispel the myths of the 3 most repeated “product” phrases in the business and startup world.

Product-Market Fit
Minimum Viable Product
Product-Led Growth

When you set out to “build the best product,” you make the assumption the product will FIND its place in the world. In reality, you have to MAKE a place in the world for your product. Category Design is a map to create a category of one.

Discover how Dropbox discredited the lie to become an $8 billion company.

The Big Brand Lie: How Categories Make Brands & Why Brand Marketers Never Believe It

In The Big Brand Lie, we reveal how a meaningful percentage of marketers, entrepreneurs, and executives are in what we like to call “The Brand Cult.” They’ve been taught the best (aka: “the most well-known”) brand wins.

Let’s think deeply about this “branding” word the business world loves so much.

BRANDING originally meant “livestock branding.” So branding is a violent, painful approach to showing a living being as belonging to you.

Are we being cheeky?

No. THINK.

Imagine branding as an idea that doesn’t exist.

Imagine you’re a marketing executive at Procter & Gamble and the guy next to you is saying, “Man, everybody’s detergent is the same. What do we do? I know. Let’s make it look different. Let’s give it a different identity. Let’s make it stand out by giving it unique colors on the box.” This is what eventually becomes “branding” (as a multibillion-dollar industry) and NOBODY goes, “Wait, hang on a minute. Maybe the solution to the problem, “We’re not different,” is to actually get different.

If brand marketing doesn’t work, then what’s a marketer, an executive, or an entrepreneur to do?

We urge you to ask this very important question: What are you DOING with your marketing? Are you forcing a choice? “We are a different thing altogether.” Or are you inviting a comparison? “We’re like everybody else, PLUS some more.”

The answer to this question is the seminal difference between brand marketing and category marketing.

See how Ralph Lauren created a successful brand through a differentiated category.

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Arrrrrrr,

Category Pirates

Eddie Yoon

Nicolas Cole

Christopher Lochhead

PS: Don’t forget to grab a copy (or gift!) of one of our best-selling books:

PPS: We are launching a Category Design Academy & Community!

Please reply to this email if you are interested in being added to the beta launch list and/or any questions or particular topics you’d like us to make sure we include. We are VERY excited about this next evolution of Category Pirates!