A category-king is a company that dominates a market category and captures most of the value in that space. Category-kings are not just market leaders, they are market makers. They create new categories of products or services that solve problems that customers didn’t know they had, or they redefine existing categories by offering superior solutions that customers can’t resist.
Category kings are rare and valuable. According to research by Play Bigger, a consulting firm that specializes in category design, category kings account for 76% of the market capitalization in any given category, while the rest of the competitors fight for the remaining 24%. Category kings also enjoy higher growth rates, lower customer acquisition costs, and stronger brand loyalty than their rivals.
So how can you build a category king company in 2024? Here are some steps to follow:
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Identify a problem that is urgent, pervasive, and valuable. The first step to creating a new category is to find a problem that is worth solving for a large and underserved market. The problem should be urgent, meaning that customers are actively looking for a solution and are willing to pay for it.
The problem should be pervasive, meaning that it affects a significant number of people or businesses across different segments and geographies. The problem should be valuable, meaning that it has a clear and measurable impact on the customer’s outcomes, such as revenue, cost, time, or quality.
Define the category and its boundaries. The next step is to define the category that your solution belongs to and its boundaries. A category is a group of products or services that share a common purpose, function, or benefit for the customer.
A category boundary is the set of criteria that distinguish your category from other categories. For example, if you are creating a new category of online education platforms, you need to define what makes your platform different from other online education platforms, as well as from other types of education providers, such as universities, MOOCs, or corporate training programs.
Position your solution as the category king. The third step is to position your solution as the category king, the best and only choice for customers who want to solve the problem that you identified. To do this, you need to craft a compelling category vision, a story that explains why your category exists, what it does for customers, and why it matters for the world.
You also need to create a unique value proposition, a statement that summarizes how your solution delivers superior value to customers compared to other alternatives in the market. Finally, you need to design a distinctive brand identity, a set of elements that communicate your category vision and value proposition to customers and stakeholders, such as your name, logo, slogan, colors, fonts, images, etc.
Educate the market and evangelize the category. The fourth step is to educate the market and evangelize the category. This means creating awareness and demand for your category and your solution among potential customers, partners, investors, media, analysts, influencers, and regulators.
You need to use various channels and tactics to reach and engage your target audiences, such as content marketing, social media marketing, email marketing, webinars, podcasts, blogs, white papers, case studies, testimonials, reviews, referrals, etc. You also need to leverage thought leadership and public relations to establish yourself as an authority and a trusted source of information on your category and its benefits.
Scale your operations and defend your position. The fifth step is to scale your operations and defend your position as the category king. This means growing your customer base and revenue by expanding into new segments and geographies, launching new features and products, improving your customer service and support, optimizing your pricing and packaging strategies etc.
It also means protecting your competitive advantage and market share by innovating faster than your competitors, monitoring their moves and countering their threats, building strategic partnerships and alliances, acquiring or merging with complementary or competing companies, and complying with relevant laws and regulations.