No Brand is an Island, Understanding Your Category
Introduction
Building a brand is hard work. It takes creativity, grit, and determination. But it's important to remember that no brand is an island; your brand exists in a broader ecosystem of other brands, physical environments, legislation, and consumers. You must understand how it fits into the bigger picture to understand your brand. Here are some things to consider:
Understanding category dynamics is necessary for building a brand
The importance of understanding your category dynamics cannot be understated. It's important for two reasons:
Understanding what is happening in the category (and how it might impact your brand) is crucial to building a marketing strategy that aligns with consumer expectations and competitive realities.
Marketers also need to understand which conventions are employed by competitors because these can affect how consumers perceive your brand relative to others in the space.
Conventions are essential to the adoption of your brand and its use cases
First, let's get a few things straight. Conventions are the rules of your game, how it is played and seen, and how it is talked about and sold. They help make sense of what you do and how people talk about it. They are essential because they help define a brand in a way that makes sense to consumers so they know what to expect when they buy something because they can see where their money went into making that product happen.
Conventions also help define categories: if all brands in a category were doing something different then there would be no common language for consumers to use when talking about those products outside them being called "something-by-brand name" (e.g., "this laptop by Apple").
And conventions are important because without them we wouldn't have any idea what those products actually mean since everything would be up for grabs!
Understanding category headwinds can help you innovate around them.
In this section, you'll learn how to identify headwinds in your category and how to innovate around them. A headwind is a product of the infrastructure that restricts growth in your category. It could be culture, trends or technology. You can't always change the nature of these things, but you can find ways around them or use them for good.
To understand what a headwind is for your business, it's important to look at the underlying reasons why something happened within your category and then figure out if there are any patterns associated with those reasons that may apply to you as well. There are three types of headwinds:
Infrastructure: These are external forces like regulations and laws that affect businesses differently based on their size or operations (e.g., taxes).
Culture: These are internalized ideas about how things should work based on past successes and failures (e.g., customer service).
Technology: These are innovations in technology that allow consumers more choices in terms of price points and accessibility (e
Category tailwinds can help your brand grow exponentially.
Category tailwinds are typically a product of culture and trends or technology. For example, social media has led to an explosion of influencer marketing as more and more people have become influencers in their own right. While the concept may seem new, it's actually been around for years — think about all the musicians who became brand ambassadors for fashion brands by wearing their clothes in music videos and on stage!
An example of a tailwind is social media which has led to an explosion of influencer marketing. Influencers have leveraged tailwinds in culture and technology to become brands in their own right.
The influencer industry is growing by leaps and bounds. One of the most interesting developments in this space is the explosive growth in influencer marketing, which has been fueled by a tailwind of technology that allows for an easy exchange of information between people and brands.
Influencers have taken advantage of these technologies to build their own brands and businesses. Their own success led them to become advertisers themselves, leveraging their networks to promote new products or services they believe in. This demonstrates one way that a company can leverage its own tailwinds—by giving away free products or services designed to get people talking about your product or service (and hopefully purchasing it).
Identifying who is in your competitive set helps you make decisions about things like advertising and distribution channel strategy.
When you're first starting to understand your business and its competitive landscape, it's important to think about how you'll identify competitors at different levels of granularity. The level of detail with which you choose to view your competitors will have an impact on the decisions you make as a company; if your team is too focused on a single competitor, they may miss opportunities in other areas. Conversely, if they're not careful about identifying potential substitutes or new entrants into their category or vertical, they risk being blindsided by competitors in unexpected ways.
To help get started with this process, try thinking about who might be considered direct and indirect competitors:
Direct: Companies that offer similar products or services as yours (including products/services that solve the same problems)
Indirect: Companies that sell complementary goods/services (i.e., those that don't compete directly but can still be used together)
Potential Substitutes: Products/services from other industries which could act as substitutes for yours
Choosing your strategic pathway means understanding the tailwinds and headwinds that will impact your brand.
When you're choosing your strategic pathway, it's important to understand the tailwinds and headwinds that will impact your brand. Tailwinds are usually a product of culture, trends, or technology. For example, as we've seen with electric cars and solar power generation in recent years, environmental awareness can be a tailwind for brands that align with this mindset.
Headwinds are usually a product of the infrastructure restricting growth in the category. For example, if there aren't enough charging stations available at gas stations across town or those same stations don't offer electric car drivers free water while they wait for their batteries to recharge (a real thing), then these are headwinds impacting electric car adoption rates among consumers.
Understanding what's happening in your competitive set helps you make decisions about things like advertising and distribution channel strategy
Conclusion
Whether you're a small startup or an established brand, understanding your category is critical to your success. The more you understand the rules and conventions of your industry, the better you can establish yourself in that market and reach your customers with targeted solutions. On the other hand, if you ignore this vital step in your company's growth, then there are many pitfalls that could lead to failure—such as failing to identify your competition and not understanding how consumers perceive products within their unique category.