Why Category Creation Isn't Always the Answer: Lessons from a Serial B2B Tech Marketer

Marketing leaders rarely become founders. But when they do, their perspective on category creation and go-to-market strategy offers unique insights for the B2B tech ecosystem. In a recent episode of Category Visionaries, Barbra Gago, Founder of Pando, shared how her experience as CMO at companies like Miro shaped her approach to building and positioning new products in crowded markets.

The conventional wisdom suggests that category creation is the holy grail of B2B tech marketing. Create a new category, own it, and ride the wave to market dominance. But Barbra's experience tells a different story – one where pragmatism often trumps idealism.

During her time at Greenhouse, the team initially attempted to create a new category called "recruiting optimization" to differentiate themselves from traditional Applicant Tracking Systems (ATS). The logic seemed sound – traditional ATS platforms weren't adding much value, so why position yourself in that category? But they quickly discovered a fundamental flaw in their strategy.

"Creating a new category when they already had a budget for an existing category didn't really make sense because then where's the budget for that new category?" Barbra explained. This insight led to a critical pivot in their approach. Instead of creating an entirely new category, they focused on elevating the existing one: "Now our goal is to make this category way more valuable."

This strategic shift proved transformative. Rather than fighting an uphill battle to create budget for a new line item, they focused on making recruiting a "really high impact, high value organization within the company." The result? Recruiting professionals using their platform started getting promoted and landing better jobs.

The lesson? Category creation isn't always the answer. Sometimes, the smarter play is to transform an existing category from within. This requires a deep understanding of how businesses actually operate – something Barbra gained through her years as a marketing leader.

"I think that positioning is a constant evolution," she noted, distinguishing it from category creation. "I think that a category is something that ends up in G2 Crowd or Software Advice or the obvious thing on the spreadsheet of budgets of every company."

This perspective has informed her approach at Pando, where she's navigating similar challenges. While the company is introducing the concept of "just-in-time promotion" and building what they call a career progression platform, they're not dogmatic about category creation. Instead, they're adapting their positioning based on market conditions.

"Obviously, last year and the year before, everything is rallying. Everybody's hiring, everybody's spending ungodly amounts of money to recruit people. And it was an employee market," Barbra explained. "And career progression, I would say, is like the luxury thing... And now that the market has changed, we're still advocating for this and still kind of building the foundation and laying the foundation for that, but also now positioning slightly more in the traditional performance review space."

For founders considering category creation, Barbra offers this crucial advice: "Don't get too stuck on it. If it doesn't work, you have to be able to let it go if it's not working." She emphasizes the importance of reading market signals: "If people aren't picking it up, if it's not getting traction, if there aren't competitors, if other people aren't referring to that as a category or mentioning it."

Looking ahead, Barbra envisions a future where career progression becomes the dominant paradigm, replacing traditional performance reviews entirely. But rather than forcing this transition through aggressive category creation efforts, she's taking a more nuanced approach – meeting the market where it is while gradually building toward that vision.

The key takeaway for founders? Category creation isn't a binary choice. The real skill lies in knowing when to create a new category and when to transform an existing one. It's about understanding budget dynamics, reading market signals, and being willing to adapt your strategy based on real-world feedback. Sometimes, the path to market leadership isn't about creating something entirely new – it's about making something existing dramatically better.