Category Design Drives Markets by Mark Donnigan

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Authored by: Mark Donnigan

TL;DR - WHAT YOU NEED TO KNOW


MBA driven marketing is dead. If you are not the Category King, you will always be fighting for scraps.

Marketing has one task, drive business outcomes. Never has the marketing leader and team needed to be
more versatile. Following the MBA marketing playbook no longer works. In today’s marketplace, the buyer
has all the power. For most markets it’s not technology risk but business risk that is the greatest.

Marketing value is measured by revenue impact. The B2B sales process is fragmented and complex with
dozens of stakeholders needing to sign off on a purchase decision, which leaves some traditional marketing
ROI and attribution techniques no longer effective.

The answer is for your company to address the market by defining a problem and naming the category of
solution that your product delivers. Category Kings take 76% of the entire markets value. They define the
market by having all competitors refer to them for comparison. Ex: Salesforce = CRM, AWS = public cloud.

The only way to drive a market is to be the Category King. If you are not a Category King, you are picking up
scraps and your marketing spend will be much higher as percentage of revenue than the leader, because
the entire industry is left to fight over the remains. Marketing’s job #1 is to define and drive your category.

Copyright 2020 Mark Donnigan | GROWTHSTAGE.MARKETING | mark@d-launch.com | page 2


Overwhelmingly, the Great product companies
data shows that startups fail because they didn’t put
do not fail because of the same attention,
lack of product passion, and ingenuity into
development, or the engineering the market as
inability to scale. they did their product.
Source: tractiongapbook.com/
The best way
to drive a market,
is to become the
Category King.
Category King:
A Category King is the company that defines the
space it operates in and conditions the market to
demand your solution or product.
Category Kings have been shown to take as much as 76% of
the entire market. This leaves all competitors fighting for
scraps. A great category established the conditions needed
for a great product and company.

Source: playbigger.com/ 5
MARKETING PILLARS
Precise market engineering is required to create uncontested space by becoming the Category King.
Three areas to conquer are Product, Demand Generation, and Category Design.

PRODUCT DEMAND GEN CATEGORY DESIGN

PRODUCT MARKETING answers DEMAND GEN MARKETING is the Go-to scale does not happen by
the “why your solution?” It must rocket fuel for sales, though accident. Category Kings take 76%
be problem-solution centered constituents include the entire of the whole market leaving all
with sufficient technical detail to company. Demand Generation other players fighting for scraps.
clear evaluation checks by cannot be measured from a MQL The #1 job of the exec
technical validators. It should lean or SQL perspective only. Demand team/founders and marketing
heavily on performance and Gen is supported and enabled by leader is to “become the king.”
benefits to support the sales CATEGORY DESIGN. CATEGORY DESIGN is the bedrock
process. for DEMAND GEN MARKETING.

Copyright 2020 Mark Donnigan | GROWTHSTAGE.MARKETING | mark@d-launch.com | page 6


Marketing Pillars: Key Concepts
1. Don’t talk features, talk problem-solution as a category. Information on your product is needed, and it should
be easy to discover. The real job of product marketing is to define the problem that you built your
product/solution to solve in the context of a category that you have named.
2. Demand generation is more than a KPI or funnel. Real demand generation only happens when you have built
a category and the market sees you as the default choice. In this scenario, your competitors must explain how
they compare to you, which is better than any earned media.
3. Category design is the first and most critical step to becoming a Category King. The concept of Category King
was ratified in the book ‘Play Bigger’. Because category kings have been shown to command up to 76% of the
market, the only choice is to become a king.
4. If an organization embraces category design as a competitive imperative, everything the company does to
market itself will be evaluated differently. Traditional marketing KPI’s will not always line up with the
objective of defining and owning a problem where your product is the obvious solution and represents the
category. Decisions around events, partner marketing, content marketing, paid/performance media, email,
SEO, speaking must all contribute in a coordinated way to building the category and establishing your
company as the king.
5. Product marketing and category creation are the foundations for demand generation which needs both to be
maximally effective.

Copyright 2020 Mark Donnigan | GROWTHSTAGE.MARKETING | mark@d-launch.com | page 7


CATEGORY DESIGN STEPS
The marketing head, supported by the executive team, is the caretaker of category design which requires full
cross-functional participation. Here is the process for making your company the most demanded by the market.

To win a market,
Define Problem Name Category
marketing must lead with
Define the problem Name the category the objective of defining
that needs and reference it
and dominating a
addressing for the when presenting
category.
category to exist. your product.
1 2
Category design is a process, but
there has never been a dominant
Develop a POV 3 4 Mobilize company in a market space who
A point of view is how The entire company wasn’t the category definition.
you will explain the must be activated in Example: AWS (cloud
need for solving the the category design computing). Salesforce
category problem. process. (SaaS-CRM). UBER (ridesharing).
Apple (iOS/mobile).

Copyright 2020 Mark Donnigan | GROWTHSTAGE.MARKETING | mark@d-launch.com | page 8


Category Design: Key Concepts
1. Problem definition is accomplished by articulating insights into problems that you’ve been able to identify, or
special technology that you’ve developed which can solve an issue in a substantive way.
2. The category name should comprise the market definition, the nature of the problem, and who the problem
most affects (the audience). This can be an iterative process, do not be afraid to refine the name or change it as
market feedback directs. The name must stick for a category to be defined.
3. Documenting the category is important. You will want to publish a visual ecosystem map or other graphical
representation that shows what exists today and what will exist in the future.
4. The POV point of view document frames the problem, articulating any ramifications for the problem not being
solved, and presents a vision for the future with your solution as the obvious answer.
5. Category design should be led by marketing, though it requires the active participation of product and sales to
get a full 360 view of the field, market, and competitive situation. Marketing may lead the mechanics but the
entire company must help once the design is complete and implementation commences. Category design
requires CEO and founder support for it to be effective.
6. The entire company will coordinate events known as ‘Lightning strikes’ that are designed to get the attention of
the entire ecosystem to shine a spotlight on the category. Marketing leads these events.

Source: playbigger.com/category-design

Copyright 2020 Mark Donnigan | GROWTHSTAGE.MARKETING | mark@d-launch.com | page 9


MARKETING MESSAGES FRAMEWORK
TARGET ACCOUNTS: ABM takes into account the full
INDUSTRY: Stage of company specific, usually spectrum of influencers and the buying group. It’s less
leads with category definition followed by 01 about competitive positioning and more about the
solution to the problem. Answers questions like, “How
answering the “who are you?” question.
Respond to “What problem do you solve and is life better after you?” + “What happens if we don’t
why does it matter?” References your POV on use or adopt your solution/product?“
the problem/solution for the category.
02

04 PARTNERS: How partners will benefit by


supporting the category and company. Content is
PRODUCT: Problem/solution centered with a focus heavy on category training using your POV as the
on defensible technology and performance basis for education and why you are the only
benefits. Will point to the category for positioning
of feature choices and key product decisions. 03 choice. The best partners become evangelists for
your company and the category.
Copyright 2020 Mark Donnigan | GROWTHSTAGE.MARKETING | mark@d-launch.com | page10
Marketing Messages: Key Concepts
1. When talking to the industry it is important to always speak in the context of the ecosystem and your role as
the leader with the most obvious solution to the problem that you have defined.
2. Too much marketing copy talks about the company or the product in terms of features or price. Customers only
care about the answer to this question: “Can you solve my problem?” Since everyone is looking for a solution to
a problem, effective marketing understands completely what the problem is and is able to explain it the
customer even better than they can articulate it.
3. ABM or account based marketing is often defined by a set of tools rather than a messaging framework for
speaking to a target account. Effective ABM uses all the appropriate marketing vehicles and channels to get the
following message in front of every buying constituent: This is the problem. Here is the solution. This is what
your life will be like after you choose us. Here is what to do next.
4. Partners will need to be trained on how to represent the category. Since being associated with the category
king is good for everyone, it will not be hard to convince your partners of the value.
5. Presenting product features and other decisions is best done in the context of the category. Don’t miss the
opportunity to further strengthen your leadership role as the Category King by presenting your product relative
to the category. In time, the industry will begin to embrace you as the defacto “standard,” which means you are
now the king. Congratulations!

Copyright 2020 Mark Donnigan | GROWTHSTAGE.MARKETING | mark@d-launch.com | page11


LET’S TALK ABOUT YOUR MARKETING
Mark Donnigan | growthstage.marketing | mark@d-launch.com
CATEGORY DESIGN STARTS
WITH THE LEADER:
There are threats, opportunities, and unknowns
everywhere. The leader must be a doer, capable of crafting
the strategy, winning over internal stakeholders, and
building a team or leading the team where one already
exists, all while executing a plan that will require
cross-functional coordination and agreement.
MARKETING LEADER ‘ROLE ATTRIBUTES’
The marketing leader must have built markets (categories), not “only” maintained brand identities.
ABLE TO BUILD TEAM OF WORLD CLASS MARKETERS.

Sales and revenue driven, comfortable Comfortable seeking alpha of the


measuring their activities based on market, and understanding trends
unknown outcomes. Willing to make when the information is highly diffuse
bold bets while limiting downside. and no historical data is available.

Crafts product messaging, and take an Able to dissect markets, observe and
active evangelism role. Have great take action, network and
instincts on category and communicate with customers using
consumer/market message fit. intuition that is informed by logic and
experience.

Copyright 2020 Mark Donnigan | GROWTHSTAGE.MARKETING | mark@d-launch.com | page14


MARKETING LEADER PROFILE
Have a record of building marketing engines (categories) in emerging or yet to be defined sectors & categories.

Creative, articulate, expressive. Good writing


ability with an understanding of copy writing
and voice will be an advantage.

Critical thinker with an analytic mind. Able to


see industry shifts, trends, and market
dynamics that others do not.

Ability to communicate to small and large


audiences, needed for 1:1 customer and
partner meetings, as well as industry events.

Revenue leadership experience having led


sales previously will provide valuable empathy
to the process.

Copyright 2020 Mark Donnigan | GROWTHSTAGE.MARKETING | mark@d-launch.com | page15

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