"Brand" in big bold font

Why brand categorization is important

Most consumers use categorization to narrow down vast product options into something more manageable. This is especially true in mature industries where products and services are often very similar – not easily distinguishable. 

How you position your brand and business, and how customers categorize you is one of the most important aspects of branding and marketing in general. 

Let’s look at the auto industry to illustrate this point better:

  • Affordable (Hyundai, Nissan, Kia)
  • Reliable (Toyota)
  • Safe (Volvo)
  • Electric (Tesla)
  • Driver-focused (BMW, Porsche)
  • Outdoor/Off-road (Jeep)
  • Luxury (Mercedes, Lexus, Cadillac)

Most consumers will make this brand categorization without a lot of thought because Mercedes has successfully associated its brand with “luxury”, Toyota with “reliable”, and so on. 

Every business (big or small) has to think about categorization – which specific category do your customers place you in?  

Brand Categorization (DOs And DONT’s)

To associate your brand with a specific category, you have to be consistent with your actions and marketing. Otherwise, your brand will fall into the gray area.  

For example, Acura has a categorization issue, because the Acura brand is sometimes associated with the “affordable” category and sometimes with “luxury”. Positioning a brand into multiple categories (intentionally or unintentionally) creates confusion in the consumer’s mind.

Spreading a brand across multiple categories often weakens a brand; therefore, pick a category and focus all your marketing messaging towards it. For example, Mercedes’ marketing is laser-focused on “luxury” – using slogans like “World Leading Luxury Carmaker” and “The Best Or Nothing”.

Even though Mercedes makes some of the safest vehicles in the world, they always emphasize “luxury” over “safety” – this laser-focus creates clarity in the customer’s mind. 

Irrespective of which category you are trying to associate your brand with, successful brand categorization can only be accomplished with laser focus and consistency (actions and marketing). 


Owning a brand category (e.g. Toyota = Quality) is the best case scenario, and something most companies should strive toward. The same applies to small businesses and startups – endeavor to associate your brand with the niche market you are competing in.

Related: Why Specialization Is Key To Business Growth

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