A lot of thought might go into the aesthetics and functionality of new products, but there is far less consideration of how to select or influence the category to which that new product will be placed. Determining in advance how people might react and relate to new products or what products might mean to them, and using that knowledge to position them correctly relative to other options in the market, can help to ensure their success.
Assistant Professor Lee Watkiss has been researching how product categories are constructed and the implications for producers.
His latest research looks at the emergence of the tablet category following the launch of the Apple iPad in January 2010.
The iPad evolution
When the iPad first launched, Watkiss said people initially didn’t understand what purpose it served. Since the iPad looked similar to another Apple product, the iPhone, people didn’t see it as novel. Once they realized the user experience is different, that changed how they categorized the iPad. Even small things like not easily being able to hold an iPad in one hand like an iPhone changed the user experience.
“In a very short period of time, people went from not believing an iPad was different, to wanting to buy it and seeing it as categorically different from anything else they’d ever had,” he said. “This is important because it opens up new ways in which we can think about how to create new categories. We have to pay more attention to how products are experienced in use, not just the functional purpose they serve.”
Using the iPad example, Watkiss found three factors are involved in product categorization:
- Customers’ experiences and expertise shape how they categorize products and choose product categories – Technology professionals were more likely than consumers to see the potential of the iPad for content production so they were more likely to categorize it as similar to a laptop;
- The nature of the user experience matters – Visual cues suggested to many that the iPad was categorically similar to the iPhone whereas handling an iPad and playing with it suggested distinctiveness; and,
- Previous acts of categorization influence later ones – Consumers who had perceived that the iPad was categorically distinctive from a laptop did not revisit that perception even after third-party developers had created thousands of content-production apps for the iPad.
His new paper, “The Cultural Construction and Structure of Product Categories: The Emergence of the Tablet Category with Apple’s iPad,” will be submitted to a journal within the next few months.
A proactive approach to product categories
Assessing how people’s perceptions of your product have changed over time in light of new competitors is also important.
Watkiss points out how Swiss mechanical watches evolved in the 1970s when Japanese companies introduced watches that more accurately kept time using quartz technology.
“The Swiss watch companies were able to say, ‘Don’t compare my watch to a Japanese quartz watch because my watch is not simply a timepiece, it’s an item of jewelry,’” he said. “In effect, they were able to recategorize their watches as being different from quartz watches.”
From idea to execution
The next phase of his research will look at the practical implications of his findings on the categorization process and how they apply to strategy.
“By elaborating on how categories are constructed, this study provides producers with a map for how to think about positioning their own products relative to others,” he said. “I think there are some exciting opportunities for organizations to not only create new product categories when they craft innovative new products, but to also reinvent their existing ones.”
Watkiss joined Ivey in August 2017 and teaches strategy analysis and action. He was a tax accountant for a number of years before doing his MBA. He also provided executive education for a startup prior to doing his PhD and pursuing a career in academia. He has previously advised and consulted for organizations across the technology, finance, energy, health care, insurance, manufacturing, media, real estate, retail, telecommunications, and transportation industries, including many of Fortune magazine’s World’s Most Admired Companies.