When Salesforce launched, it didn't tell buyers it had better sales software. It told them software itself was over, painted a red "no software" circle on its marketing, and named a new thing: the cloud. Buyers who bought that story weren't comparing features anymore, they were choosing a side. That move, naming and shaping the box a product gets judged in before competing inside it, is category design.

The quick version

  • A category is the mental box a buyer files you in. Whoever defines the box sets the terms everyone else is judged against.
  • Category design means creating and naming a new market category, then positioning your company as the obvious leader of it, instead of fighting for share in an existing one.
  • The headline claim, from Play Bigger, is that the "category king" captures the large majority of the category's economics; their figure is 76%.
  • It's a powerful reframing tool, but the evidence is built from winners in hindsight, treat it as a strategy to pressure-test, not a guaranteed playbook.

The idea in depth

The clearest articulation of category design comes from Play Bigger (Al Ramadan, Dave Peterson, Christopher Lochhead and Kevin Maney, 2016), which grew out of work by the Silicon Valley advisory firm of the same name. Their argument inverts the usual order of business. Most companies design a product, then a company, then go looking for a market to sell into. Category designers, they say, do all three at once, and crucially they design the market category too, defining a new problem worth solving and casting their company as its answer.

Why bother? Because of a lopsided pattern in how markets reward leaders. Play Bigger's stated finding is that once a category matures, "the category king" ends up "controlling 76% of the category economics", the lion's share of the value the whole category creates. Winners don't merely edge ahead; they take most of the pie, while everyone else divides the remainder. If that pattern holds, the highest-leverage marketing question stops being "how do we win this category?" and becomes "which category can we own outright?"

"The category king reaps the rewards.", Play Bigger

So the move is: before you write a single feature comparison, decide what category you want to be measured in, and whether it already exists. If it does and a king already rules it, competing on features is the slow, expensive path. If you can credibly name a new problem the incumbents aren't built to solve, you change what "best" even means. Salesforce didn't win the on-premise software category; it made that category sound obsolete and crowned a new one.

Why naming the problem beats winning on features

There's a marketing reason this works, and it predates the Silicon Valley framing by decades. In Breakthrough Advertising (1966), copywriter Eugene Schwartz described five stages of "market sophistication": the more rival products a market has already heard about, the harder direct claims land, because every "we're faster / better / cheaper" sounds like the last one. By the late stages, sharper product claims stop working and you have to shift the ground, identify yourself with the buyer and the problem rather than out-shout competitors on the same promise. Category design is essentially Schwartz's late-stage move played at the level of a whole market: when buyers are numb to feature claims, you reframe the problem so the old claims no longer apply.

The positioning strategist April Dunford makes the practical version of the same point in Obviously Awesome (2019): your positioning is the set of clues you give buyers about what to compare you with, and the "market category" you choose is the most powerful clue of all, because it triggers a whole set of assumptions about what you do, who you're for, and what counts as good. Pick a familiar category and you inherit its expectations and its competitors. Frame a different one and you change the comparison set entirely. The practical upshot: treat your category as a deliberate choice, not a default you back into. Write the sentence "We are the leading ___ for ___" and notice how much rides on that first blank.

flowchart TD
  P("A real, unsolved problem buyers feel") --> N("Name the new category that frames it")
  N --> POV("Stake a point of view: why the old way is over")
  POV --> Prod("Design product, company & category together")
  Prod --> Edu("Teach the market the problem, not just the product")
  Edu --> King(["Become the category's defining leader"])
  King --> Econ(["Capture the majority of category economics"])
Category design runs problem → name → point of view → market education → leadership, rather than product → features → market share. Leaders Loop

The honest limitation. The evidence is retrospective, and that matters. Play Bigger's case is built by studying companies that already became category kings, then describing what they did, a textbook setup for survivorship bias. We rarely hear about the firms that invented a clever category name and a bold point of view and still failed, because the market wasn't ready, the problem wasn't real enough, or a better-funded rival took the crown. The 76% figure is Play Bigger's own research, not an independent peer-reviewed result, and it describes mature winners rather than predicting which bet will win. Critics also note the model over-weights timing and market readiness, things you don't fully control, and quietly ignores the many companies that thrive as profitable number-twos. Use category design to sharpen your strategy and stress-test lazy "we're better" thinking; don't mistake a tidy story about winners for a guarantee you'll be one.

A worked example

Take a small company that makes scheduling software for independent physiotherapy and allied-health clinics, call it a composite, and treat every figure below as illustrative. It's losing deals to two general-purpose calendar-and-booking tools that are cheaper and better known. The feature-fight instinct is to add more features and trim the price until the spreadsheets line up. Everyone in that bracket is doing the same, so the demos blur together and the founder is competing as "a slightly different booking tool."

Run the category-design move instead. Name the problem the incumbents aren't built for: not "booking," but the no-shows, rebooking and clinical follow-up that quietly drain a therapy clinic's revenue. Name a new category around it: "patient retention software for allied health," not "scheduling." Stake a point of view: a missed appointment isn't an admin glitch, it's a broken course of treatment, and a generic calendar will never fix it. Teach the market: publish the benchmark on what no-shows actually cost a clinic per year, so prospects start measuring themselves against a problem only this product fully addresses. The illustrative result: the company stops appearing on the same comparison grid as cheap booking tools, because buyers now ask a different question, "who keeps my patients in treatment?", and there's one obvious answer. No new core technology was required, only a different answer to "what category are we in?"

flowchart LR
  subgraph Feat["Feature fight"]
    A("Add features") --> B("Same grid as rivals")
    A2("Cut price") --> B
  end
  subgraph Cat["Category-design move"]
    D("Name the unsolved problem") --> F("New comparison set")
    E2("Stake a point of view") --> F
    G("Teach the market the cost") --> F
  end
  B --> Bleed(["Demos blur, margins bleed"])
  F --> Own(["One obvious answer, for now"])
Illustrative: competing on the same grid keeps you interchangeable; reframing the category changes the question buyers ask. Leaders Loop

Frequently asked questions

Isn't category design just positioning with a bigger ego?

They're close relatives, not the same thing. Positioning (in April Dunford's sense) is choosing the best context for an existing offer so buyers understand it; category design is the more ambitious act of trying to create the context, a new category, and lead it. Every category designer must position well, but most positioning work happens inside categories that already exist. Reach for full category creation only when you genuinely have a new problem to name; otherwise it reads as hype.

Do you have to invent a brand-new market?

Not always. Category design also covers re-framing or renaming an existing space so it bends toward your strengths, splitting a broad category into a sharper sub-category you can own, or giving an unnamed problem a name for the first time. The common thread isn't novelty for its own sake; it's controlling the terms of comparison rather than accepting the ones rivals set.

Does this only work for venture-backed tech companies?

That's where the case studies cluster, and it's a fair caution, naming a category and educating a market takes patience and budget. But the underlying logic (define the problem, don't just answer it) scales down: a consultancy can name a service category, a B2B firm can name a buyer's hidden problem, even an internal team can reframe what a project is "really" about. What you can't skip is the market-education work; a clever name with no one taught to want it is just a slogan.

What's the biggest way it goes wrong?

Naming a category nobody actually needs. If the problem isn't real and felt, you spend years and a marketing budget teaching a market that politely declines to care. The discipline is to validate that buyers feel the problem before you crown yourself king of the solution, which is why category design pairs so tightly with real customer-needs work rather than replacing it.

What's the single most useful thing to take from it?

The first-blank test. Finishing "We are the leading ___ for ___" forces you to state the category you're competing in out loud, and the moment you say it, you can ask whether that's a fight you can win or one you should reframe. That one sentence is worth more than most positioning decks.

Related in the Toolkit

Category design sits on top of the rest of the marketing canon: it's an aggressive form of brand positioning, and it lives or dies on the latent customer need the new category claims to serve.

Where to go next