Hard Lessons in Category Creation

A conversation with Shobhana Viswanathan, CMO of Mavim

Last week, I met with Shobhana Viswanathan, a former colleague of mine at Automation Anywhere and current CMO of Mavim, a process management platform for B2B enterprises. An engineer by training, Shobhana has had a diverse career that has spanned product, marketing and corporate development. She’s spent time at industry giants such as IBM, Sun Microsystems and VMware, in addition to a handful of startups. Today, she also hosts her own podcast on the future of work — The Change Alchemist.?

Shobhana’s true passion is B2B marketing, as evidenced by her current gig, and over the course of her career she has accrued particularly detailed knowledge around the much discussed and oft misunderstood topic of category creation.?

Category creation has become all the rage, with startups eager to carve out new spaces in a rapidly digitizing world. But it’s not an easy process, nor one that everyone does successfully, and the sheer volume of startups attempting to create their own categories muddies the waters further.?

Shobhana and I sat down to discuss her experiences in this realm, how founders can learn from the successes and failures of others, and where the process actually starts.?

Tell me a bit about your personal experience with category creation.

My first true experience with category creation was at a 600-person startup called VMware. At the time, it was a small, Stanford-based company, very engineering driven, with very little marketing DNA. The category we were playing in was new. Today virtualization is something nearly everyone in the industry is familiar with, but at the time people hadn’t really thought about consolidating servers or that an X86-based virtual machine would provide such enormous energy, cost and operational benefits for IT. In a way, it was the killer app for IT. But our marketing hadn’t caught up. We had VMworld, but it was mostly catered to IT admins, and for a long time CIOs and higher-level decision makers didn’t really understand the depth and breadth of what virtualization could do for their companies. That was the initial problem we set out to solve by building a new category, building out content strategies around feature benefits. We were disrupting traditional IT with a new model, a new technology and a new category as a new player. It was truly the Wild West of category creation.?

When I was at Automation Anywhere, we faced a completely different category creation challenge. The category had been somewhat established by Blue Prism, but they had never really monetized it. We expanded and solidified that category by taking a multi-faceted approach to what had traditionally been a one-dimensional space. Because of that, we were speaking to three different audiences(developer, business and IT) all at once and had the additional task of creating a category that would resonate with all three. In this case, we differentiated ourselves against competitors by expanding our use cases with different audiences.?

At VMware, the strategy was very technology-driven. We really leaned into the number of patents, the technology, the first mover advantage. With Automation Anywhere, it was more of a business-oriented playbook.?

But the common theme was long-term investment in the category creation strategy.

What is the first thing startup leaders should expect when they’re trying to create a new category, and what’s the first thing they should do to lay the groundwork?

The first thing to expect is that not everyone will get what you’re trying to do right away. Category creation is as much about brand as it is about anything else, so big brands usually have an easier time with category creation than small startups. There are examples of companies that succeed in doing this right away, like Uber with ride-sharing or Hubspot with inbound marketing, but they’re the exception more than the rule. Your early adopters will understand, but if you’re looking for a defensible moat right off the bat, that’s probably not going to happen.?

The first thing company leaders should do when they’re creating a new category is simple — research. The early research consists of two parts happening simultaneously. One is to research the potential paths you can take. What categories already exist? Why don’t you fit? Should you name it after the problem your technology solves, or is that limiting? The other is customer validation. Talk to customers and get their input. Once you have a short list of potential categories, go back to them and see how they respond.?

Once you have customer buy-in, conduct independent research with third parties, collect insights from VCs and analysts or research surveys. The more feedback from the community you will eventually try to sell this idea to, the better.??

What are the most important things startup founders need to consider when creating a new category?

Executive buy-in and alignment. This cannot be a CMO’s pet project. There is no point to going any distance down this road without buy-in from the board and alignment across the c-suite on purpose, strategy and tactics.?

It’s also important that founders understand their competition and where they are in their own journey, so that they know who they’re going up against and why their own category and positioning will work better. Positioning and messaging are often thought of later, but they need to be developed simultaneously as part of the category creation process.?

Creating a category also requires investments of time, money and people. A lot of the work that has to be done is top of the funnel content and thought leadership that requires boots on the ground and significant budget. Remember that customers may not initially be interested in the product, because the first step is to learn why the category is of interest to them. Leading with category education is as important as the product. This comes back to the reality that not everyone is going to get it right away, and the only way to move the needle with people is to educate. It takes a lot of repetition through many channels.?

What are the hurdles and traps most commonly experienced by companies creating a new category? How can they avoid them?

The hardest part is finding your category. It’s become fashionable to create categories, everyone wants to do it, but the revenue doesn’t always follow. That’s an indicator that the mark has been missed, if a company does everything right but the message simply isn’t landing. Leads don’t come in, sales struggles as a result, which has a direct impact on immediate revenue.?

Avoiding that problem takes self-discipline. Category creation is something every CMO wants to put on their resume, it’s a Holy Grail like building a website from the ground up. But it’s not a business imperative for every company. Oftentimes, it’s more of a solution in need of a problem. To avoid getting it wrong, startups need to ask themselves honestly whether it’s something they need to do. The struggle for all technology companies is the same — in a highly commoditized world, how do you stand out? That’s what prompts the category creation journey for many. But maybe there’s a category that already exists that you can disrupt. Maybe you’re a category of one because you’re ten years ahead of the market. This is where the research really comes into play.?

Who are the audiences you need to reach, and how do you do that?

Across B2B, in traditional Web 2.0 companies, Gartner is critical. They are still the 800 pound gorilla in B2B enterprise markets, and it’s hard to successfully create a new category in the space without their buy-in and support. Forrester is another. Reaching these firms isn’t just as simple as setting up vendor briefings, it takes care and a personal touch to build trust and rapport with analysts.??

There are a few boutique firms that have started to gain traction over the past few years, and the role of influencers and industry thought leaders has become significantly more pronounced. The pay-to-play world is expanding a lot in that regard — speaking engagements, launch support, social media support.?

Of course the most obvious and important audience is customers and prospects. Their buy-in is a dealbreaker. To reach them, digital really has to take on a life of its own. Social media is critical, and everything long-form that we do on the web needs to be available in snackable formats on social. Customer advisory boards are still critical, whether live or on Zoom, some kind of forum that provides a two-way conversation and an outlet for feedback.?

Content lies at the core of category creation, particularly when it comes to reaching customers and prospects. Outreach to these audiences in the initial phase of category creation needs to be coupled with a highly strategic content strategy that leans heavily on thought leadership and third-party validation.?

How do you know when you’ve succeeded??

There are early signals along the way that tell you you’re on the right path. Competition copying messaging, or hearing people repeating what you’re saying. Word of mouth improves, and there’s a sharpened focus within the company itself — internally, everyone is on message and excited about it. Go-to-market and sales conversations will allude to your messaging without prompting. Share of voice and press mentions pick up, and you’ll see your messaging reflected in organic coverage as well as paid. Increased engagement across social media can be another indicator.?

When you have a defensible moat, when you can say that your name is synonymous with the category, and your revenue shows a relationship between brand name recall and dollars generated. If most people can only think of one or two companies within a category and yours is one, that’s an achievement.