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Avoiding the “Existing Market Trap” Before It Costs You Trillions
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Most people don’t think. What they do is retweet — in their head — something they agreed with. Something someone else said that they thought was smart. Most people don’t actually think about that thing; they just go, “Oh yeah, that sounds right,” and then they repeat it. (Christopher Lochhead)
(0:00 - 06:41)
Alex Shevelenko talks with Christopher Lochhead, the marketing mastermind behind Play Bigger and the concept of category design. They start with a fun food metaphor, comparing business strategy to cooking: a brilliant product or idea is useless if it’s “frosted with dog poop”—meaning it’s packaged or presented poorly. Just like a high-end restaurant can stand out by caring about every detail, businesses need to wrap their ideas in a way that truly resonates with the right audience.
They dive into a staggering statistic: out of $17 trillion invested globally in startups, roughly $13 trillion is expected to be lost, mostly because entrepreneurs are chasing existing markets instead of creating new ones. Lochhead calls this the “existing market trap,” where companies compete on minor improvements instead of defining a fresh category that acts like a magnet for customers.
The conversation also touches on how to spot this trap. Many people mistake features like co-pilots or AI assistants for the core value of a business, but Lochhead emphasizes that the defining characteristic is what truly differentiates a new category. He also warns that most people repeat ideas without really thinking, which makes it even easier for startups to fall into the same patterns that lead to wasted investment.
In short, the episode mixes sharp business insights with vivid metaphors, showing why thinking differently—and carefully about category creation—can be the difference between massive success and catastrophic failure.
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Rethinking Success: Why Creating a “Different Future” Beats Competing With the Status Quo
The competition is not a company or a product — the competition for people who are category designing different futures is the status quo. (Christopher Lochhead)
(06:41 - 11:51)
Lochhead uses the example of Palestine and Israel to illustrate how culture, values, and opportunity shape whether people or countries thrive. He points out that creating change isn’t just about competing with what exists—it’s about rethinking the entire system and imagining a better future.
The conversation then moves to technology and entrepreneurship. Lochhead explains how Zoom founder Eric Yuan didn’t just compete with WebEx—he solved a bigger problem: the status quo of poor-quality online meetings. By rejecting existing assumptions and imagining a different future, Yuan created massive value and changed how people work and communicate globally.
The key takeaway: whether in business, technology, or society, true innovation comes from thinking unconventionally, challenging the status quo, and designing entirely new possibilities—what Lochhead calls “category design.”
How Zoom and Purell Show the Power of Solving “Unseen” Problems
There are only two kinds of problems: known problems that have some kind of solution, and problems that are unknown or unacknowledged — but once they’re acknowledged, people can’t unsee them. (Christopher Lochhead)
(11:51 - 17:13)
The speakers use Eric Yuan, the founder of Zoom, as a key example. While working at WebEx, Yuan noticed that online meetings were clunky—especially on mobile devices. Big companies stuck in the old ways couldn’t see the potential, so he left, raised money from friends, and rebuilt the product mobile-first. By removing friction and designing an experience people didn’t even know they needed, Zoom became a massive success.
Lochhead explains that creating new categories starts with defining the right problem for the right audience. There are two kinds of problems: ones people already know and have solutions for, and unknown or unacknowledged problems that, once revealed, feel impossible to ignore. Examples include charging your smartphone in a car, or Purell creating a new category of hand sanitizer when people assumed soap and water were enough.
The takeaway: true innovation isn’t just improving what exists—it’s noticing hidden problems, designing experiences that solve them, and creating entirely new ways for people to interact with the world.
Owning Problems and Thinking Ahead: Lessons on Innovation and Category Design
the greatest moat in the world is owning the problem.
Because she who owns the problem becomes the solution. (Christopher Lochhead)
(17:16 - 26:50)
Alex Shevelenko and Christopher Lochhead dive into how innovators create lasting impact by identifying and owning problems others don’t see. They start with a fun but clear example: before hand sanitizer existed, people didn’t think, “I need to clean my hands without water.” Gojo Industries reframed that problem, invented a new category, and became the solution people couldn’t live without. Lochhead emphasizes that owning a problem is the greatest moat a company can have—it makes you indispensable.
The conversation then shifts to the modern pace of innovation. Alex points out that with today’s rapid development cycles, competitors can copy ideas almost instantly, making it harder to maintain an edge. Lochhead responds that while speed always feels overwhelming when a new platform or technology emerges, the key is “thinking about thinking.” Instead of treating markets like the weather—uncontrollable and random—leaders should recognize that markets change because people drive them. By understanding who is shaping the market, innovators can anticipate shifts, claim problems, and create entirely new categories.
The takeaway: true advantage comes from reframing problems, thinking deeply about how change happens, and designing solutions that define new markets rather than just competing in existing ones.
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From Zero to a New World: How OpenAI Created a Whole New Category
Markets, just like products and companies, are things we can design. (Christopher Lochhead)
(26:52 - 34:20)
The speakers talk about how true innovation isn’t just about building a great product—it’s about creating an entirely new category. Lochhead uses the launch of ChatGPT as a dramatic example. Before OpenAI released it, there was no real market for generative AI — no customers asking for it, no “problem” to solve. But when ChatGPT launched, it didn’t just introduce a tool — it created a whole new way for humans to use technology. In a single moment, OpenAI turned “zero demand” into one of the fastest-growing markets in history.
Lochhead argues that this proves markets aren’t just forces of nature — they can be designed, just like products or companies. Great entrepreneurs don’t wait for markets to appear; they invent them.
Alex then challenges this idea, pointing out that real-world innovation often unfolds chaotically, like a revolution. Once a breakthrough happens, competitors rush in, everything speeds up, and the landscape becomes messy and unpredictable. He mentions Perplexity as an example — a company offering a powerful AI “answer engine” that competes with Google. Despite its success, Lochhead says Perplexity “gets an F in category design” because it positioned itself as “Search 2.0” instead of defining an entirely new category.
The takeaway: building a better product isn’t enough. To truly change the game, you have to name and claim a new problem — and design the category that solves it.
Don’t Think About Pink Elephants — Why Comparing Kills Innovation
The belief that “the best product wins” is so omnipresent that even those of us who make a living doing category design launched the product first, not the problem.(Christopher Lochhead)
(34:20 - 36:52)
In this part of the conversation, Alex Shevelenko and Christopher Lochhead explore why companies lose their edge when they define themselves by comparison instead of creating something original. Lochhead uses a classic “pink elephants” exercise — when you’re told not to think about pink elephants, that’s exactly what fills your mind. The same happens in marketing: when Pepsi says it’s “better than Coke,” people still think of Coke.
Lochhead argues that this is exactly where Perplexity went wrong. By calling itself “Search 2.0,” it defined itself in Google’s shadow — making Google the main character of the story. Instead of competing on someone else’s turf, great companies “frame, name, and claim” a new problem and solution.
Alex brings up SuccessFactors as another example — how they once described themselves through their product features instead of the problem they solved. Lochhead agrees, explaining that most companies think “solution-first” rather than “problem-first.” Even his own team made that mistake with their first book, focusing on the solution (category design) before clearly defining the problem it solved.
The takeaway: innovation starts with defining a new problem, not a better product. If you compare yourself to the old way, you’re already thinking like it.
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From Features to the Corner Office — How Real Leaders Define Problems Worth Solving
Ask yourself five to seven times: what is the real problem we’re solving? And that’s what gets you to the big aha. (Christopher Lochhead)
(36:52 - 43:07)
The speakers unpack how true innovation starts by asking the right question: What problem are we really solving?
They revisit the early days of SuccessFactors, when the company offered tools like “goal cascading.” Instead of seeing it as just another HR feature, Lochhead reframed it: the real problem wasn’t about performance reviews — it was about a company’s ability to execute on its goals. That’s what CEOs truly care about.
Lochhead emphasizes that most businesses make the mistake of thinking from the product out instead of the problem in. The key, he says, is to ask “why” repeatedly until you reach the real issue driving customer behavior. When SuccessFactors shifted its focus to helping CEOs drive execution, everything clicked — investors understood it, senior HR leaders embraced it, and the company’s value skyrocketed.
Alex adds that there’s still a challenge: sometimes a bold new category makes sense to senior leaders, but mid-level buyers can find it confusing or intimidating. Lochhead agrees, noting that in enterprise tech, the biggest winners always “win in the C-suite.” But he also points out that smaller players can still succeed by focusing on specific needs of startups or SMBs — as seen with Virtuous AI, a company helping smaller businesses move faster with AI before big corporations catch up.
The takeaway: great companies don’t sell features — they define problems that matter to decision-makers and align their message to the level of buyer they’re speaking to.
Win in the Corner Office — Why Selling the Problem Beats Selling the Product
If you’re unwilling — especially in the beginning, though it always matters — to pick a very clear problem experienced by a very clear set of people and own that problem, you’ll lose.(Christopher Lochhead)
(43:07 - 56:10)
The speakers discuss what it really takes to succeed in enterprise business — and why most companies get it wrong.
They begin by touching on a major obstacle to AI adoption: governance. Lochhead points out that big financial firms like Goldman Sachs can’t just feed their private data into tools like ChatGPT without risking leaks of valuable information. So while AI is booming, many regulated industries are moving cautiously.
From there, the conversation shifts back to enterprise selling. Lochhead makes a clear statement: if you want to win in the enterprise, you have to win in the corner office. Meaning — major deals don’t happen unless a C-level executive believes in your product. Selling only to mid-level managers might get you small wins, but to land million-dollar contracts, you need to speak the language of decision-makers.
He explains that too many sales teams waste time talking to people who can only say “no,” not “yes.” The key is crafting a strong point of view (POV) — a clear way to frame, name, and claim the problem your company solves. If you define the problem better than anyone else, people naturally assume you have the best solution.
Lochhead compares this to an accordion: when talking to executives, you stay focused on high-level strategy; as you move down the org chart, you expand into more technical details. Smart CEOs may dive deeper, but they still care most about the big picture — execution, results, and alignment.
The discussion closes with a glimpse into the future: Lochhead notes that Salesforce recently replaced 4,000 customer service jobs with AI, showing just how quickly “sales agents” and automation are changing the way business is done.
The big takeaway: focus on defining the problem, build relationships at the top, and tailor your message to the level of your audience — because that’s where real category leaders win.
Check out the episode's Transcript (AI-generated) HERE.
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Author
Experience-focused Leaders is the #1 Multimedia Podcast! We talk to senior business & tech leaders about the experiences that move forward organizations, customers and society at large. True to form, we mix audio, video, web and eBook formats to turn these authentic conversations into personalized nuggets you'll remember & use.
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