TABLE OF CONTENTS

Marketplace Category - A Powerful Positioning and Messaging Shortcut

2) Choose

Route A: Adjacent

Route 2: Creative

Route 3: Established

Example: Marketplace Category

Next: Overcoming Objections

Messaging and Positioning Template: Marketplace Category

Find your marketplace category to craft compelling messaging and positioning with our template

Strategic Vision

Dan Wu, JD/PhD

Jan 6, 2025

Find your marketplace category to create compelling messaging and positioning with our template for social impact leaders

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Identify your marketplace category to create compelling messaging and positioning with our template for social impact leaders

This is part 5 in the series below.

This is a series about building and testing your messaging, positioning, and value proposition

#1 - Messaging & Positioning Template for Social Impact Leaders
#2 - Messaging & Positioning Template: Core Unmet Needs
#3 - Messaging & Positioning Template: Ideal Client Profile
#4 - Messaging & Positioning Template: Differentiated Solution
#5 - Messaging & Positioning Template: Marketplace Category
#6 - Messaging & Positioning Template: Overcoming Objections
#7 - Messaging & Positioning Template: Testing
#8 - Messaging & Positioning Template: Learning from Data

Marketplace Category - A Powerful Positioning and Messaging Shortcut

In many ways, this is equivalent to the “topic sentence” of your entire value proposition, which is why I recommend we tackle it after you’ve clarified unmet needs and your differentiated solution.

Defining your marketplace category establishes the competitive space in which you operate, defining your natural competitors or workarounds.

At Joyful Ventures, our innovation advisors specialize in helping social impact leaders like you create people-first innovation processes that maximize your and your organization’s impact.

Example of a Marketplace Category

An example marketplace category is a customer relationship management (CRM) system. By saying you’re a CRM, people will immediately think of Salesforce or Hubspot, and immediately get an idea of what you do.

Using a marketplace category is ultimately a powerful messaging shortcut, quickly enabling your audience to understand what you do with only a few words.

Yet choosing the right category can also be incredibly tricky, requiring you to be thoughtful about which relevant category you are most likely to win.

Say you are a new innovation with limited resources. Choosing to play in the CRM category will be an uphill battle. Salesforce and Hubspot have spent millions in the last decade developing vast feature sets, marketing engines and social proof, and proven capabilities.

But you can still win in certain instances. For instance, selecting a growing market with a core unmet needs, where you have critical unequal advantages and major differentiators Salesforce and Hubspot lack.

This is in fact how many high-growth innovations get their start — and why we spent significant time thinking through your target market in this series.

You might be thinking “how do I find out what these categories are to begin with?”

1) Audit

Find your natural competitors or workarounds.

A) Brainstorm
• Bright Spots: Re-review the work you did on identifying your target segment’s top current solutions and workarounds.
• Talk to your segment: Ask your top customers (or prospects) — or review your customer notes or existing data online, such as online groups. You can ask them questions like, “How would they describe your solution to a colleague? Who (or what workaround) do they see as your natural competitors?”

B) Categorize

What categories do your main competitors or alternatives use to describe themselves?

Look at their websites, social media, or databases like Crunchbase or TrustRadius to see how they’re categorized by industry analysts.

This is also a good opportunity to learn:
• How do they describe your common target market and their top core unmet need?
• Their differentiation?
• What does or doesn’t resonate with you?

C) Rate

Understand the strengths and weaknesses of each marketplace category you’ve identified.

Here are some criteria to score each category against from 1-5:
• How well does your target audience understand this category?
• How likely are you to succeed in this category based on your differentiation?
• What is the growth rate of this market category?

As usual, if you’re finding lots of ties, use the tie breakers already mentioned, such as evidence quality and market size.

2) Choose

After your marketplace audit, consider how you’d like to choose a marketplace category. Below are three common strategies.

Route A: Adjacent

Select an adjacent, rapidly-growing category

Looker's journey illustrates the potential of this approach. The company initially faced a growth crisis, failing to compete with established solutions in the “database” category like Oracle and Microsoft SQL Server, lacking essential features such as robust data blending and user-friendly interfaces for large datasets.

After a customer suggested that they seemed more like a “business intelligence” or “data warehouse” tool, rather than a “database,” they decided to experiment. These were two rapidly-growing (but smaller) marketplace categories better known by forward-thinking data teams.

Looker ultimately repositioned as a “business intelligence” platform, leveraging its unique LookML modeling language and Google Cloud integration. With these two differentiators, Looker bridged a real core unmet need, experienced rapid customer growth, ultimately leading to a $2.6 billion acquisition by Google Cloud.

Route 2: Creative

Create or reinvent existing categories

Creating a new category carries significant risks, especially when introducing an unfamiliar concept. This approach may confuse your target audience with new terminology, and the lack of established search terms can impede discovery.

However, this strategy can prove effective in saturated markets where entering existing categories is challenging, and you're not prepared to substantially modify your core offerings.

Success in category creation often hinges on a few key elements:
• Reframe: Reframing existing concepts with highly-growth or well-established terms or concepts that have the potential to create new winners or losers in the marketplace
• Reputation: a strong reputation as a thought leader with a wide audience can facilitate promotion of the new category with a strong narrative

HubSpot's approach to "Inbound Marketing" exemplifies this strategy. They became closely associated with an trending marketing approach, positioning their product as a key supporter of this methodology, while technically competing in the CRM category. This effectively established them as leaders in this redefined space.

Route 3: Established

Compete in a crowded or established market category.

Competing in an established market category can be tough, but it’s definitely possible if you have the right advantages.

This might mean having unique technology, forming partnerships with rapidly growing companies, or using a business model that really shifts the risk or benefit—like purely outcome-based pricing.

Take Looker, for instance.

Even though they did choose a less competitive category, it was still a thriving one. Their partnership with Google Cloud gave them a solid edge in the crowded business intelligence space.

Uber’s disruption of the “taxi” category is another great example. They leveraged new technology to enable dynamic pricing and an asset-light marketplace business model to compete effectively in a highly-competitive, well-established market.

Example: Marketplace Category

Revisiting our ongoing example, "Donor engagement platform" category was chosen.

Core Unmet Need

DonorFamily is a donor engagement platform helping fundraising teams at community health nonprofits reduce donor churn by building healthy, engaged donor communities without manual data tracking and segmentation.

This choice was strategic, positioning you in a space adjacent to the highly-competitive CRM sector.

You saw potential for high growth in this area, and after carefully evaluating your competitors' strengths and resources, we determined it was a market we could effectively compete in.

This evaluation was was based on an honest assessment of our differentiators and how they stacked up against existing players in the field.

Next: Overcoming Objections

This next section are methods that help you overcome objections through the use of Social Proof, a Use Case & an Offer. These help you improve the believability that you can in fact help your target segment get from their current state to dream outcome.

See the next article in the series below

This is a series about building and testing your messaging, positioning, and value proposition

#1 - Messaging & Positioning Template for Social Impact Leaders
#2 - Messaging & Positioning Template: Core Unmet Needs
#3 - Messaging & Positioning Template: Ideal Client Profile
#4 - Messaging & Positioning Template: Differentiated Solution
#5 - Messaging & Positioning Template: Marketplace Category
#6 - Messaging & Positioning Template: Overcoming Objections
#7 - Messaging & Positioning Template: Testing
#8 - Messaging & Positioning Template: Learning from Data

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Dan Wu, JD/PhD

Messaging and Positioning Template: Marketplace Category

Marketplace Category - A Powerful Positioning and Messaging Shortcut

Example of a Marketplace Category

1) Audit

2) Choose

Route A: Adjacent

Route 2: Creative

Route 3: Established

Example: Marketplace Category

Next: Overcoming Objections

Related Posts

Messaging and Positioning Template for Social Impact Leaders

Messaging and Positioning Template: Learning From Data

Messaging and Positioning Template: Ideal Client Profile