When founders first hear “category design”, the reaction is often immediate.
Isn’t this just clever positioning?
Isn’t it simply giving the product a shinier name?
Isn’t it branding with a louder drum?
If that were all it was, it would not deserve much attention.
The real value lies elsewhere. Category design is not about making an old thing look brighter. It forces you to answer a more strategic and more uncomfortable question:
Are you selling a solution inside an existing frame, or are you changing the frame through which the market understands the problem at all?
That distinction matters more than most startup advice lets on.
In an existing market, buyers tend to drop you into a familiar comparison table. More features, lower price, stronger brand, broader distribution, faster onboarding. If you are lucky, you become the best-looking square in the grid. If you are not, you discover that you built something genuinely new and the market still measures it with an old ruler.
At that point, the problem is not always that the product is weak.
Often the problem is that the market is using the wrong lens.
That is why category design is genuinely useful for founders. It is not about making the deck sound grander. It is about recognising that markets are not merely found; they are also framed.
Lochhead names the failure mode directly in the transcript: the existing market trap. The point is not that existing markets can never be attractive. The point is that founders often accept an inherited comparison frame far too early, and then wonder why the market keeps measuring them with somebody else’s ruler. That is why category design is not rebranding. At its core, it tries to solve a more strategic problem: what happens when your value depends on changing the question, but the market insists on using the old one.
Let’s clear away the usual misunderstandings
Category design is not first-mover advantage
This is the confusion to fix first.
Many people hear “category creation” and assume it means being first to ship a new kind of product. Yet Harvard Business Review is quite explicit on this point: a category creator is not automatically the same thing as a first mover. Being early can matter. The more difficult and more valuable task is defining a new problem, teaching the market to see it through a different lens, and making your product the natural answer to that new frame.
That is why technically earlier companies do not always win. They may ship first, but still fail to win the market’s language, interpretation, and criteria.
Apple is a useful example here.
Stanford’s account of the Xerox PARC visit notes that, in 1979, Steve Jobs led a team from Apple to PARC and saw windows, icons, the mouse, and related interface ideas. Apple did not invent those technologies first. But Apple did something Xerox never fully managed: it turned them into a new, legible computing experience for ordinary people. Apple’s own recent fiftieth-anniversary reflection still makes the same point in a more polished way: technology alone is not enough; technology needs to meet design, intuition, and a human touch before it becomes meaningful.
So the first lesson in category design is not “be earlier than everyone else”.
It is decide whether the market needs a different frame for understanding the thing.
Category design is not a naming project run by the brand team
In the transcript you shared, Christopher Lochhead uses a farmers’ market sign as an example and distils the lesson into a line worth keeping, if used with some restraint:
category first, brand second; different, not better.
I would not treat that as universal doctrine. Brand matters. Distribution matters. Product quality obviously matters. The point is narrower than that. When the market does not yet understand what you are, enlarging the logo and polishing the brand story rarely solves the core issue. The buyer still lacks a proper mental model of the category.
That does not make brand irrelevant.
It means that in category creation, the first problem is usually not the brand. It is the problem frame.
Category design is not merely wordplay
A new name matters, though not because words are magical. It matters because new language changes what people notice and how they classify what they are seeing.
Lochhead keeps returning to the same idea in the transcript: language creates a boundary in thinking. There is something solid in that observation. If you look back at the better examples, the power did not come solely from product features. It came from changing the vocabulary of the market.
Salesforce’s “No Software” did not mean Marc Benioff had stopped selling software. It pulled buyers away from the old on-premise software frame. HubSpot’s “Inbound Marketing” was not just a memorable label. It helped persuade the market that the interruption-heavy marketing playbook was losing its edge and that there was a different way to attract demand. SPANX replacing old, awkward language with “shapewear” changed not only the label but the emotional frame of the category.
The label is the surface.
The real question is whether the market starts using new language to organise the problem differently.
What category design is actually doing
If I had to reduce it to one sentence, I would put it like this:
Category design is the strategic act of defining a new problem frame so the market adopts new buying criteria and sees your product as the natural answer to that new frame.
There are four important parts inside that definition.
1. It is problem design, not just product messaging
Founders often rush to the solution.
The homepage opens with:
- we use AI
- we are faster
- we automate more
- we cost 30% less than the incumbent
None of that is automatically wrong. But if the market is still thinking inside the old problem, those claims often collapse into one more row in a comparison chart.
Real category work usually begins somewhere else:
- how the market currently understands the issue
- where that understanding has gone stale
- why a new technological or behavioural shift has broken the old way
- how the actual problem should now be named
You do not begin by selling the answer.
You begin by helping people agree that the old question itself is no longer adequate.
Otis is a superb example.
Otis’s official history is clear on this. Elisha Otis did not merely create a thing that moved vertically. He created a safety brake. What made the market understand the breakthrough was not just the mechanism. It was the famous 1854 Crystal Palace demonstration. The rope was cut, the platform did not crash, and suddenly the category moved from “a risky lifting device” to “safe vertical movement”. That was not just a product reveal. It was a redefinition of the problem.
2. It is a fight for interpretation, not simply a fight for visibility
Visibility can be bought.
Traffic can be bought.
Press can be bought, or at least pursued.
But category interpretation is harder. It does not emerge just because you spend more.
What category design is really competing for is:
- who explains the problem most clearly
- who helps the market realise what is actually broken
- who gets buyers to adopt new criteria
- who gets investors, journalists, analysts, operators, and customers to use their language
That is why I think of category design less as a campaign and more as market reframing. It behaves more like a market education effort than a burst of promotion.
3. It matters especially in B2B
Category creation is often illustrated with consumer examples, but B2B may need it even more because enterprise buying depends so heavily on category language.
Salesforce did not merely sell CRM features. It helped push a different way of thinking about software delivery. HubSpot did not merely sell marketing tools. It turned inbound marketing into a legible method, a budget line, and a buying frame. Microsoft’s real strength with Office was not simply that Word, Excel, and PowerPoint were each competent products. It was that Microsoft reframed them together as a productivity suite. Microsoft’s own timeline marks 1989 as the introduction of the earliest Office suite, not merely another collection of standalone products.
In B2B, buyers are rarely asking for something merely novel. They need to know:
- what kind of thing this is
- which budget should pay for it
- which team should own it
- what KPI should measure it
- what old tool, workflow, or assumption it replaces
The more your product changes workflows, budget logic, or organisational behaviour, the more category work tends to matter.
3.5. This is not confined to one industry
This is worth stating explicitly, because category design is often misread as either a consumer-brand trick or a Silicon Valley myth. It shows up across very different markets. The surface changes, but the underlying move is similar.
- Apple / Jobs: Apple did not invent the GUI, the mouse, or the windowing system first, but it helped reframe how ordinary people understood personal computing.
- Salesforce: it was not merely selling CRM; it reframed enterprise software around cloud delivery, lower operating burden, and faster deployment.
- Microsoft Office: it did not simply offer better standalone tools; it rewrote the category around a productivity suite, and changed the evaluation criteria with it.
- Airbnb: it did not begin by asking whether its listings were “better than hotels”; it reframed travel through “live like a local”.
- OpenAI: it did not present itself as Search 2.0; it helped the market understand prompting, conversational AI, and a different model of work.
Taken together, these examples make the point more clearly: category design is not a trick limited to one sector. It is closer to a cross-industry strategic capability. The task is not to make the product sound better. It is to help the market admit that the old frame is no longer sufficient.
4. It is powerful, but expensive
This point matters, otherwise the whole idea turns into founder theatre.
HBR and Play Bigger frequently cite the claim that the category leader captures a disproportionate share of value. That helps explain why category creation has become so seductive to founders and investors. But it does not follow that every company should rush to invent a category. SaaStr puts the warning plainly: successfully creating a category is extremely hard. You are not just building a new product. You are teaching the market, changing habits, building trust, and staying alive long enough for buyers to catch up.
Sapphire Ventures makes the same point from the operating side. Category creation is not a neat tagline and it cannot be delegated to marketing alone. Product, founder narrative, sales, content, and go-to-market all have to line up.
So this is not a startup cure-all.
It is a high-risk, high-upside strategy that demands unusual consistency.
Why founders should care anyway
Because a surprising number of startups do not lose on product quality. They lose by being placed in the wrong drawer.
Hidden loss 1: You get compared against the wrong alternatives
Your product may be changing the workflow, yet the market treats it like a point solution.
You may be changing the delivery model, yet buyers still compare you on legacy feature criteria.
You may be collapsing coordination costs across a team, yet the market judges you on seat price.
At that point, you are not only losing to competitors.
You are losing to the old category’s comparison frame.
Hidden loss 2: You reduce your value to a feature
Without category thinking, founders often compress a breakthrough into an enhancement.
You are really selling a new way of working, but you describe it as an AI feature.
You are really shortening the path to a decision, but you describe it as automation.
You are really selling a new operating model, but you describe it as analytics.
That loss is quiet, but severe. The market ends up thinking you have “some interesting capabilities” instead of seeing you as a new logic of choice.
Hidden loss 3: You educate the market, but fail to tie the problem back to yourself
This is one of the classic traps in category creation.
The MIT Sloan Management Review argument about would-be category kings becoming commoners is worth taking seriously. Some companies do the labour of enlarging the market and educating buyers, only to watch others capture most of the value. In other words, you can do the education and still fail to own the category.
That tends to happen when:
- the story is too generic
- the problem definition is not tightly tied to your own point of view
- the company evangelises the trend without building proof and ownership around it
Not every company should attempt category creation
This section matters because otherwise the article becomes a sermon.
If reading these examples makes you think, “right, then I must invent a category too,” I would slow down.
Cases where you probably should not force category design
1. The market already has clear buyer intent
If customers already know what they want and actively search within that category, you may be better off with sharp positioning inside the existing market.
2. Your product mostly optimises rather than rewrites the question
If it is simply 20% faster, 15% cheaper, or somewhat easier to deploy, that is more likely a positioning problem than a category problem.
3. Your runway cannot support market education
Category creation takes time. If what you need now is pipeline, cash conversion, and a clearer path to product-market fit, teaching the market a new frame may simply be too expensive.
4. Your own team has not aligned on the problem
If the founders, product team, sales team, and marketing team all describe the problem differently, the category narrative will scatter the moment it goes live.
Let’s stop here for Part 1: category design changes the question the market believes it is solving
One of the most useful ideas in the transcript is this: do not throw yourself into someone else’s comparison table too early.
Said more calmly, it means:
The mistake founders make is not always that the product is weak. It is that they accept the market’s existing question too quickly.
That is what Part 1 wanted to pin down. Category design is not mythology, not a naming game, and not merely a grand branding wager for large companies. It is a more demanding strategic task: redefining what problem the market believes it is solving.
In Part 2, I’ll move from why to how: how founders actually do category design, how they write the problem frame, the point of view, the language, and how that narrative shows up in the website, the product, sales conversations, and fundraising rather than remaining a clever slogan.