How Companies Become the “Industry Giants” of a Market Category
Certain products have so dominated their market segment that their names are synonymous with the product itself. Think Kleenex, Dumpster, Escalator and Aspirin, to name a few.
How does a product name become the name of a product category?
Two Ways:
First, a company’s product may have created the product category itself. As a first mover, the product name then becomes the name of the category..
Google is a marquee example. The company invented the search engine, which then in turn became a new product category. Their market dominance as a first mover cemented them as the category name. Google has become a verb. Don’t believe me? Go Google it.
Alternatively, a product becomes so dominant in the market that, over time, consumers equate the specific product with all the products in that category.
Dumpster is an American brand name, invented by the Dempster-Dumpster company in 1936. Their novel patent for standardized garbage disposal led to widespread adoption throughout the United States. Their success led to dumpster becoming the generic name for a large garbage container.
Which Current Company Brand Names Are Taking Over Product Categories?
You can identify a few.
If you use a ride-share app, you probably have Uber on your phone. Uber has a 72% share of the ride-sharing market. Even if you used another ride-share company yesterday, and you were describing to someone what you did last night, you probably said, “I Ubered home from the bar.”This is similar to Google, as their first-mover advantage has cemented them as a market leader.
If you had a video call with friends or for work, rather than say you were using Facetime or Google Meet, you had a Zoom call. Ironically, ZOOM did not invent or popularize the video call, Skype did. However, Skype’s business model did not lead to wide market adoption. ZOOM’s ability to sync with calendars and its widespread use during the 2019 pandemic led to their market leadership.
Future Category Leaders 10-20 years From Now?
Can you identify any companies out there today who aren’t quite “industry giants” now but stand a good chance of becoming one?
There are a few contenders. Spotify is popular, owning a third of total music streaming. Amazon’s Kindle owns 68% of the electronic book market.
It takes time, in the consumer’s mind, for the specific brand name to become the product name. Market penetration to become a category brand seems to hover around 80% or above of total consumers.
Time will tell.
In the meantime, I have to go. I need to Venmo a friend for dinner last night.