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The Art of Category Creation: Lessons from a Three-Time Category Creator

Creating a new market category isn’t just about having a novel product – it’s about identifying and solving fundamental problems that haven’t been addressed before. In a recent episode of Category Visionaries, Eric Olden, CEO and founder of Strata Identity, shared his framework for building and defining new categories, drawing from his experience of creating three successful market categories in the identity management space.

The Foundation: Problem-First Thinking

The journey begins with understanding the problem landscape. Eric’s first venture into category creation started at Berkeley in 1995 when he identified a crucial gap in the emerging internet landscape. “We realized that it would be security,” Eric recalls, explaining their early insight that security would be the missing ingredient in the commercial internet’s growth.

But identifying a problem isn’t enough – it needs to be a top priority for potential customers. “If the problem that you’re talking about isn’t the top one, two or three priority for the people you’re talking about, then you may build a product, but it’s not important enough for people to do much with it,” Eric emphasizes.

The Dirty Dozen Approach

One of the most tactical insights Eric shared was his “dirty dozen” methodology for validating new categories. “We call this in practice the dirty dozen. And it’s an easy number to remember. Twelve is a good sample size,” he explains. The approach involves:

1. Deep engagement with early customers
2. Accepting that some approaches won’t scale
3. Identifying the core 6-8 customers who share the same problem
4. Being willing to walk away from customers who don’t fit the core use case

The term “dirty” comes from dealing with customers who are unclear about what they want because they’ve never seen this solution before.

Content Strategy for Category Creation

Eric revealed a sophisticated content strategy that focuses on addressing how customers search for solutions. “When we started 2019, no one was going into Google and searching for identity orchestration. What they were doing is they were searching for their problem,” he explains.

This insight led to a content strategy focused on answering specific technical questions: “How to manage two identity providers. We use Okta and we use Microsoft. How do we make them work together?” This approach has paid dividends – their early content from 2020 continues to drive significant traffic and leads.

The Long Game of Analyst Relations

When it comes to establishing a new category, analyst relations play a crucial role. Eric advises against viewing analyst relations as merely transactional: “Even when I was at Oracle, we had infinite budgets. It doesn’t matter how much money you spend with the analysts, they’re not going to write stuff just because you’re paying them.”

Instead, he advocates for:

• Building long-term relationships with analysts
• Investing in specialized PR firms that understand your market
• Focusing on micro-analysts and industry influencers
• Being transparent about conflicts of interest

Market Education Through Research

One of the most effective tools in Eric’s category creation playbook is original research. Their “State of Multicloud” report began as customer development research but evolved into a powerful content asset that provides peer comparison data for their audience.

The key to successful research content is longitudinal analysis. “The way it looks like in a report is, what are your top three concerns of security for a multi cloud? And maybe in 2023 it was a, B and C. And how does that compare to last year?” Eric explains.

2024: Refining the Message

Looking ahead, Eric’s focus is on message refinement: “Market the vision and sell the product.” This means narrowing their go-to-market message while expanding product capabilities. “We’ve really oriented our go to market message around a very concrete, tangible set of value propositions, solving very tactical things,” he explains.

This strategy of combining big-picture category creation with tactical problem-solving exemplifies how modern B2B companies can successfully create and dominate new market categories. It’s not just about being first – it’s about being thorough, patient, and focused on solving real customer problems.