Forget the brand, think categories

Forget the brand, think categories

What is the name of the third person to fly the Atlantic Ocean solo? If you didn’t know that Bert Hinkler was the second person to fly the Atlantic, there is a high chance you have no idea at all about the name of the third person.  But you do.  It’s Amelia Earhart.  I’m sure you have heard of her.  Let me now ask you this: is Amelia known as the third person to fly the Atlantic Ocean solo, or as the first woman to do so?  

The most successful computer company of the seventies and eighties, next to IBM, was Digital Equipment Corporation (DEC).  IBM was first in computers. DEC was first in minicomputers. Many other computer companies (and their entrepreneurial owners) became rich and famous by following a simple principle: if you can’t be first in a category, set up a new category you can be first in.

When you launch a new product, the first question to ask yourself is not “How is this new product better than the competition?”  but “What category is this new product first in?”.  Charles Schwab did not open a better brokerage firm.  He opened the first discount broker.  This is counter to classic marketing thinking, which is more brand-oriented: how do I get people to prefer my brand?

Forget the brand. Think categories. Prospects may be defensive when it comes to brands since everyone talks about why their brand is better. But prospects have an open mind when it comes to categories. Everyone is interested in what’s new. Few people are interested in what’s better. When you are the first in a new category, promote the category.  In essence, you have no competition. Digital Equipment Corporation (DEC) told its prospects why they should to buy a minicomputer, not a DEC minicomputer.  In the early days, Hertz sold rent-a-car service. Coca-Cola sold refreshment.  So I repeat myself: forget the brand and set up a new category you can be first in.

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