How to Design a New Category

ABOUT THIS EPISODE

In this episode, Olivia Hurley talks to Josh Lowman, Founder & Chief Creative Officer at Goldfront Agency.

...mhm Hi everyone welcome back to be to begrowth. My name is Olivia Hurley and today I am joined by josh Lohman who isthe founder and chief creative officer at Gold Front, josh, how are you doingtoday? I'm doing great. It's nice to be here. Good. I'm so glad. I'm reallyexcited. We get to talk today. So you're the founder and chief creativeofficer at Gold Front, which is the world's first category design studio.That really begs the question, what is category design? Okay, well actually itbegs the question, what is a category design studio? Your right, let's start,let's let's start there. What is a category design studio? Okay, so firstof all, I'm here in san Francisco, this is where Gold Front is my company andwe are a category design studio. And that means that we help startups createand own their own category. Um, we're a category design studio because we'rethe first creative company to combine category strategy with all the creativeexecution you need to do to launch that category in the world. Brand designwebsite, design video, et cetera. And the what the importance of having acategory design studio in the world is that our clients for the most part havebeen using a very old kind of strategy called Brain strategy. And it can't getthem to where they really want to go because Brain strategy was invented tohelp people stand out in an existing category like cars or cigarettes orsomething like that. Category of strategy was invented to help companiescreate entirely new species of products, something entirely new. And it'sdesigned around that there's a lot of overlap with brand strategy, but aslong as you're putting your...

...communications and your ideas and yourvision into the world, into the kind of language of brand strategy, it's goingto limit what your company can be. And that's why we're a category designstudio. Well, there you have it. So brand is becoming antiquated or is notright for startups, especially who are bringing something new into the world.So can you walk me through what category creation is in its essencecould just ground us in a definition to start with. Sure, category design wasfirst made popular in the book play bigger about five years ago. But theidea that People make buying decisions based on category 1st and foremost hasbeen around for decades. And category of design is the intentional creationof new market categories so that you can own a much bigger kind of marketthen you otherwise would if you were in an existing category and the worddesign in there, I think suggests that it's something that you do thoughtfully,it's something that you do with a lot of rigor and it's something that you do,bringing together a number of different elements, all working in concert to getyou to your goal. So who might the people or companies be who need to bethinking about category design is it for everyone are there? People whowould you don't need it? Yeah. Yeah. So category creation in and of itself hasbeen around forever, you know, as long as there have been products, butcategory design has really taken off in...

...these last 5 to 10 years because we'rein this time where there's all these companies who are innovating people arecreating totally new kinds of products at a much higher rate than they used to.And so category design has been picked up as this kind of very relevant thingfor startups to do and especially for startups that are, are funded, peopleare investing a lot of money in those startups. And so they're shooting for abig acquisition or some some kind of event liquidity event at the end wherethey're valued very highly. And the way to do that is not through competing inan existing category, but it's to create a category of your own. Okay, sowe know why we're doing it, we know who's doing it. Let's talk about thehow, so you bring companies in and take full assessment and walk with them fromstart to finish, of course, in this category design process. But would youmind just kind of sharing the high level process if somebody wanted tomaybe take stock of what that would look like starting by themselves? Yeah,I'd be happy to. You don't need us, you can do it yourself and if you weregoing to do it yourself, here's how I would do it. First of all, you have tocarve out the time in your schedule. One of the reasons why we are soeffective for our clients is because our clients are busy constantly all dayputting out fires, answering emails, taking care of their to do list. And wecarve out time to really think deeply about category. But you can do the samething. You have to go to your boss, you have to say, look, I need at least anhour every morning where I don't have...

...to do any email, I'm not going to be onslack, I won't be in any meetings. Okay. Because you're gonna need that time towrite and really think so once you've got the time scheduled, the next thingyou're gonna need to think about our kind of three big buckets or thingsthat we need to define for as category designers. The first is the gap. Whatis the gap that you are trying to close or solve for your customers? Second iswhat is your vision for the future, five years down the road, What does theworld look like for your customers and even for the world if you areultimately successful with what you're doing. And the third is what's yourcategory idea and the category idea is best expressed as the name of acategory and maybe a single sentence describing what that what that means. And so once we, so you start with thosethree ideas and then I want to talk a little bit about how you're reallyactually going to do this. So you get into your writing time, no one's goingto bother, you don't check anything of all your notifications. And then you'regonna write down, you just start with the gap and the way that you get to thegap because you're going to start writing down problems that you uniquelysolve for your customer. So you know, this is all assuming you already have acompany and a product and maybe you're an existing category but you want to bea category creator, right? So you take that product that you have and youthink like what problems do we solve for customers especially what are weuniquely solve for customers. And the first thing people will do will be totry to write this in terms of the features and benefits of their product,but don't do that. You want the reverse, you want to write it down as problemsthat your customers have And just write...

...down a ton of stuff. Uh this is tooexpensive. It's too hard to do. X. um just keep writing stuff down. Youshould get a list of 20 things and you're gonna look at that list andthink about what are the things that are mostvaluable that we solve and one of the things that are most unique most unlikeanything else and you're going to start to think about like, okay, how could Iget wrap all this up into one concept and that one concept is something thatwe call the gap. You're going to try to name the gap, We're going to try toname this one concept that is all of the problems that you uniquely solved.So for example, we just launched a category for our client visible busy bowas an event management software platform. They just came out as anevent experience. Os and that's very different than just event managementsoftware and for them, the gap that we helped them land on is the event impactgap. So that's the impact that people who are putting on events are unable tomake for their business and for the event goers with existing eventmanagement software. So that was, that's an example of one gap, butyou're gonna have to name your own gap and so that's that's the gap part. SoI'm curious about the, about the problems parts. So a couple ofimportant assumptions that need to be made one, you know, your customer basereally, really well, you know what they're dealing with in their day today, that's going to help you when you really think through the getting to anaccurate gap, I would assume right and the second one would be knowing whatyour competitors are doing, knowing that your space really well becausethat's how you're going to be able to determine, we do this either uniquelyor we do it the best. And here's why in...

...order to tightly determined at the end of thatexercise, what is the gap and even how do I begin to put language around it?Absolutely. When you say those are true, Absolutely. That second thing you said,it's that's so spot on Olivia, you have to have a good, once you come up withall the things that you, the problems that you solve, you have to have comeup with a really good list of what? Okay, well, which of those things areunique and better than who we perceive as our competitors are doing this iswhy you need the notifications off in a couple more, a couple hours in the perweek to really be left alone to figure it out. Probably some research involved.This, it sounds like creating this list is the foundation of everything to come.That's right. That's right. Ok. Okay. So we're putting a lot of thought intothis and a lot of that's right. That's right. And in fact, if you really solvethat gap the right way, if you can really name it, Probably 70% of the waythere. If you really nail that, you can probably get to the rest of it. Butwe're not going to do that. We're not going to jump the line. We're going togo to the next thing, which is now, you're going to write down your visionfor the future and when we ask our clients to talk about their vision forthe future a lot of times they'll be like, well we're super successful andwe're making a lot of money and people love us, you know, and which of coursethat's sure who wouldn't want that, but the vision that we're talking about iswhat specifically does it look like for your customers if you guys are reallysuccessful and the key is that you're being really specific and you're usingyour imagination to really imagine what it might be like five years from now.So for example, Uber is a client of...

...ours and they have the idea that if wekeep going like this in the future we can take more cars off the road. And sopart of their vision is cities may actually have more space forpedestrians and bicycles and things like that. That's a really greatspecific way to talk about their vision for the future. And so you kind of wantto think creatively about that and really kind of get into the details oflike what does that world look like for your customer? Hey everybody Logan wassweet fish here. If you're a regular listener of GDP Growth, you know thatI'm one of the co hosts of the show, but you may not know that I also headup the sales team here at sweet fish. So for those of you in sales or salesops, I wanted to take a second to share something that's made us insanely moreefficient lately, our team has been using lead I. Q. For the past fewmonths. And what used to take us four hours gathering contact data now takesus only One where 75% more efficient. We're able to move faster with outboundprospecting and organizing our campaigns is so much easier than before.I'd highly suggest you guys check out lead I. Q. As well. You can check themout at least I Q dot com. That's L E A D I Q dot com. Alright, let's get backto the show. I love that. This is a big goal in the world of like investing. Idon't know why that comes to mind right now, but they call it like the bigaudacious goal. And I think this is I love actually when we were talkingbefore we were on this call you had mentioned companies are interested indoing well. So revenue success very measured but doing good as well. And Ithink this is where you get to get...

...creative. But you also the it soundslike this vision is very large, it's not unrealistic. It's very connected tothe business, it's very connected to the impact that your product can makeor your service can make. How detailed do you get with this vision any ofthese for both the problem and vision. It's really just a series of simplestatements. So for vision, you know, just write down a sentence that says,what does the world look like in five years and then you don't have to writeparagraphs or it's just a list of ideas And you know, you probably want 10-20of those. Yeah, okay, 10-20 vision statements. I'm curious about one thingactually, if we can hop back up to determining the gap, is there a waythat you recommend people test that, that what they've come up with isaccurate? Yeah, best way to test is the way Quentin Tarantino does. So hewrites his scripts and he's obviously one of the most successful filmmakersin Hollywood and he works really hard on his scripts and then he invites aperson over and he reads them every part of the script while they standthere or sit there or whatever and if they go, wow, that's amazing, I love it. Then heknows that it's ready and I'm sure he does that to more than one person, butthat's the best research you can do is you take your ideas, you pitch them topeople and you wait until you get you start getting reactions where peopleare like, wow, you really got something mm Okay, good way to, good way to test.So then we've written down the problem, we've established the gap, we know whatour vision is, we know our direction and where we're heading, we know thatwe're going to be thinking more than just everyone in the company is drivingLamborghinis and we're just rolling in...

...it. I don't care about cars at all, butthat's, that's expensive and it's far, it's far more about how are ourcustomers lives being changed or impacted. So what's next? What comesnext? Okay, so then when we get to the final part, which is your category ideaand most, most of the time category ideas are going to come out as categorynames and just come up with as many as you can. Don't worry if they're good,just write stuff down, write whatever comes to mind. Once you've written downsay 50-100, you could go back and you could bold the ones that you think aremost interesting. You want to think about, You kind of need to think abouttwo things during this stage. You need to think about what is the idea, likewhat is the actual concept of this thing? But then you also need to thinkabout what does the actual name sound like. And there's a few things aboutnames that are kind of important about category names. One is that they shouldbe fairly rational. So something like Nike, just do it, just do it thatdoesn't work as a category name. Um, it's a great tagline of course, butit's just not telling you enough about what the thing is. So a category nameshould tell you what is it. The other thing that I would think about is youalso want it to be a little bit emotional or have a little bit oftension, something interesting about it. So we just named the event experienceos for obisbo, that word experience is more emotional than a word likemanagement. And then also when you say that it's an os you're really sayinglike, hey, this is something big, this is a much bigger play than just a toolor piece of software and so things like...

...that, give it a little bit ofexcitement and you know what it is, That's right, there's obviouslyintrigue and a hook and you want to learn more, but you can probablysurmise accurately what it is. Other examples of categories, account basedmarketing, account based marketing is the famous category. Yes. What might bea few others? Well, we we created a category for our clients all daykitchens and all day kitchens came out as an alternative to ghost kitchenslast year. Ghost kitchens were pretty big. There were this idea that therewas this idea that kitchens without, that weren't restaurants could berented by restaurants and it would allow them to increase their deliveryfootprint. Right? And all day our clients that all day kitchens came outwith some with a kind of different way of doing this whole thing, trying toget a similar result, but a different way of doing it, which is to actuallyrun the kitchen's themselves and let the restaurant make the food at theirrestaurant and then from there all day kitchens picks up the food and thenmakes it at all these satellite kitchens and there they have expertchefs at the center of their business, so they know how to take, You know, theamazing food of a great local restaurant, and then they learn how tomake it exactly like that in their kitchen, and they can take thefootprint of the delivery footprint of a local restaurant and expand it from,you know, maybe two miles to 50 miles. And so they really wanted to let theworld know that they were different than a ghost kitchen. So we came upwith this, this name of a distributed...

...restaurant platform and we really likedthis idea of naming it around the kind of restaurant because really they'reall about championing restaurants, They saw this moment that restaurants, localrestaurants were gonna get steamrolled by, you know, our delivery future andso they wanted to give restaurants a chance to transform into something thatcould win in that future. And the transformation that they're, they'resaying restaurants can make is to become a distributed restaurant. Sothat's a great local restaurant that has the capacity that all day kitchensoffers them. Oh my gosh, I think that's awesome as somebody who lovesrestaurants and loves probably eating. I think that is brilliant. So remind meof the category, name, distributed restaurant platform. And then there'sanother category name in there, which is a distributed restaurant. So you'vecreated to it's two categories, right? Oh my gosh, which is just absolutelywonderful and brilliant tactics. So then does that allow for other in thiskind of thought experiment for a second? Would that potentially allow for otherpeople, other companies to then move into that category? That's already beenestablished for them? Yes, that's the idea is that other companies could moveinto that category as well and they will at some point if it's successful.Right? So there's an idea that the category is a almost like a gift thatyou give to the world who knew that this was so benevolent. I mean, that inthe truest way, I think that's that's awesome. So curious about you justmentioned if it's successful, I'm curious about some of the results thatcategory creation has, has driven that you've seen personally with yourcompanies and that you've worked with around, you know, okay, they create thecategory, they have this vision for the...

...future, then what? How are they reallyassessing? Yeah. So the results that we see our clients getting are kind ofamazing. I mean, first of all, almost all of our clients go on to raiseanother much bigger round after they do category creation and that's the numberone way that they're going to measure this? Is, did this raise awareness fortheir company? Their product, their category. Did it make people start toconvert to become customers did increase revenue, things like that. Andif they can do that then they're going to be able to get another, you know,additional round of funding that's even much, much bigger than the previous one.And so that that happens almost like clockwork for most of our clients. Butalso there's I mean there's just like huge potential in this. We worked withanother agency played bigger to write the category P. O. V. For Qualtrics andQualtrics at the time was a survey company. They were being lumped in withMedallion and Surveymonkey and the evaluation was a little bit under abillion dollars. Which was they were doing great but cool tricks had avision that was much bigger than surveys. And so we helped them land onthis new category, P. O. V. And then when they brought that out to the world,their valuation just shot up because people perceive them as no longer in anexisting category. But a really exciting new category that they werethe leader of. And valuations go up when you're perceived as the leader ofan exciting new category. And so today that was five years ago that we didthis work and Now the evaluation is that I think it's around 24 billion.They're a public company and they still use um so in their S1 when they filedto go public, they still use all the...

...same ideas to express their value inthe world from five years ago. That's incredible. One billion. Which is Ilike you said, sitting pretty up to, did you say 24 billion? I think that'swhat it is. Yeah. Yeah. So what was their new category? Experiencedmanagement, experienced management? They're gap is the experience gap. Andso the experience gap is the difference between the experience that yourcustomers are having and the experience that your executives think that they'rehaving. And if those two things are way out of whack and you know, different,then you've got a really big problem in Qualtrics is the first experiencemanagement platform that closes that gap. This is so interesting to mebecause I'm sure that that's a prevalent problem for many companies isthe experience you're exactly think your customers are having versus theexperience that your customers are having. And people can use Qualtrics isa great example of of, you know, that category has already been created andwe could either join in with Qualtrics if that makes sense, or we can use thatas a stepping stone and think, I think it provides even more guardrails foraddressing their own categories. That's a great example. I love that one. Ifyou were to give a few red flags or warning signs. As people who take this.Maybe internal assessment or the D. I. Y route of creating or thinking througha new category for their company, what would be some of the wrong turns thatpeople might take? Okay? The biggest thing is people thinking too small,just got to think like how big could...

...this thing be and can't be too attachedto what you have right now. Category design is not just like a marketingthing, you're not looking at. What what product do we have now, How do we paintit and how do we show it in its best light? Category design is a little bitof that but it's also invention. And so I think what I see is people may bethinking a little too small or thinking more about what do we need to do in thenext couple months as opposed to where do we need to get to in, you know, fouror five years. How do you help people kind of break out of that, that smallmind sound. Yeah, it's interesting because there's a few ways that I thinkthings that we do that part of our process that is helpful. 11 thing isthat we only work with the Ceo, I mean we work with the CEO and otherexecutives but if the Ceo is not involved then we won't do categorystrategy with them. And so that's that's one big thing right there andthen we're not cheap as a company. And so our clients put down real money todo this thing and I think just the act of doing that makes it so that they'regoing to give it more attention and really give it their focus. Anotherthing is we do workshops that are 2.5 or three hours and usually there's fouror five of them. So that's a big investment of time. So when you get theceo investing money time, getting all the executives together, then it takeson a different, you know, way that people are thinking about it comparedto some of the other initiatives that they have going on. And I think that'sreally important in order to kind of...

...think big enough about what you'redoing, there's some major skin in the game there, and they want to get themost juice good news as we say. Yeah. Oh my gosh, that's phenomenal. And then,you know, and then also on our side it's incumbent upon us to think big toand to be kind of as dramatic as we can. And I think one thing that'sinteresting about is when we're writing strategic narratives and helping ourclients figure out the story of this new category. We're always using thisidea that, like, okay, it's got to be as dramatic as possible, and then we'regoing back to like, well, what can we actually approve? Like, what do weactually have? So that this doesn't just come across as Bs, right? Andwe're always trying, kind of, going back and forth between those two things.Be as dramatic as possible. Make sure it's not Bs be as dramatic as possible.Make sure it's not Bs. And we're trying to find that connective tissue so thateventually we can get a story that really is dramatic but also resonatesas true for the audience. Oh my goodness, you have put so much thoughtinto this. Does this work just light you up? This sounds just my God, It'sso fun. It's so fun. And it's meaningful to, because new technologiesare going to decide our fate, it's going to decide the fate of our species.We may destroy ourselves, we may save ourselves. We don't know. But these newcategories that are being created are going to be the thing that decides that.And so, you know, you better make them good. And also we have a particularinterest in making sure that those new categories are purpose driven, humanist,good for the world. So it's very fulfilling work. That sounds awesome.I'm so glad you're doing that. I'm so glad so many people have been coming toyou and creating these new categories.

You are wicked Good at what you do.Just even from these stories, I'm so lucky that we've gotten to chat today.If there was one big takeaway you wanted listeners to come away from thisepisode. Just one nugget. What would it be? Believe in yourself if you feelthat you've got a better way that your company could be doing things andpeople are saying, nah, nah, forget about it. Just, let's do it the old way.Just believe in yourself. You got to figure out a way to break out of thatand listen to yourself and try to, you know, do something big for your company.I love it and do the legwork, you know, do that list, writing of the problemsand figuring out the gap like you said, I, I think that's phenomenal advice.Well thank you so much for joining me on GDP growth Olivia. I really enjoyedthis. It was great talking with you. Oh awesome, thank you. Are you on linkedin? That's a stupidquestion. Of course you're on linkedin here, Sweet fish. We've gone all in onthe platform. Multiple people from our team are creating content there.Sometimes it's a funny gift for me, other times it's a micro video or aslide deck and sometimes it's just a regular old status update that sharestheir unique point of view on B two B marketing leadership or their jobfunction. We're posting this content through their personal profile, not ourcompany page and it would warm my heart and soul if you connected with each ofour evangelists, we'll be adding more down the road, but for now you shouldconnect with Bill reed, R. C 00 Kelsey Montgomery, our Creative director danSanchez our Director of audience growth Logan Lyles, our director ofpartnerships and me, James Carberry. We're having a whole lot of fun onlinked in pretty much every single day and we'd love for you to be a part ofit.

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