Like everything else, nothing remains the same forever. New categories are born, evolve, and eventually fade away. Every change in a category has an impact on the brands within it. In today’s AI-driven world, category changes are happening at a rapid pace. Are you prepared for a brand repositioning?
When categories split, the mindshare is distributed among subcategories. For instance, when the family car category split into hatchbacks, sedans, family SUVs, and family 4×4, the mindshare of brands spread across these new subcategories. Some subcategories may only appeal to car enthusiasts.
At times, categories become irrelevant. The phone category transitioned from analog cabled phones to mobile phones and finally to today’s smartphones. In each step, we witnessed a new leader emerge. Motorola, renowned for its analog cordless phones, introduced the StarTAC clamshell mobile phone in 1996. The StarTAC achieved massive success in the USA and featured in numerous Hollywood movies. However, it was Nokia that became globally synonymous with mobile phones. Nokia evolved the category by incorporating computer-like functions such as an address book, calendar, notes, and simple games.
New categories, new leaders
Nokia was the first to launch smartphones, although they still had keys and resembled traditional mobile phones. In 2007, Apple revolutionized the category with the launch of the iPhone, featuring a touch interface that marked a clear break from the mobile phone category. The iPhone kickstarted the modern smartphone category we know today, causing Nokia’s global dominance to fade away. Presently, the smartphone category hosts numerous brands like Huawei, Oppo, Xiaomi, and Nokia, but it remains primarily dominated by Apple and Samsung.
In the phone category, the leading brand was able to evolve into the next category but never retained its leadership position. This pattern is not unique to phones but applies to nearly any evolving category.
AI accelerates category changes
Today, any category that can be AI-powered will undergo transformation. The keyword to watch out for is Smart: smart cars, smart watches, smart photo editing, smart ordering systems, and more.
When the leap from the current product or services to the smart counterparts is perceived as significant, it opens the door for a complete category shakeup, often accompanied by the emergence of new brands. We have witnessed this in the phone industry (Nokia to Apple) and the automotive industry, where underlying technological changes have been emphasized (leading to Tesla/Polestar). Similar “smart” shakeups will occur in many categories we currently take for granted, ranging from healthcare devices to photo editing software and customer support solutions.
For brands to survive within categories heavily affected by AI (which includes almost every category!), it is crucial to manage the category and brand association effectively and navigate the perceptual change of the brand in relation to the category’s evolution.
In my book Win With What I provide numerous methods and tools to help brands stay on the growth path or regain their position in a changing landscape.
This article is from the book Win With What – the first category-led growth book for anyone who wants their business to thrive and survive.
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