Categories and the short head
Zipf's Law tells us that something that ranks #1 in a category often sells 100 times as well as the item ranked #100. Human nature makes that likely--we want to read the most popular book, hire the most successful speaker, travel to the most desired place.
Which means that the category you're in matters.
The New York Times doesn't have one bestseller list, it has many. Hardcover and paperback, sure, but also non-fiction, fiction and "advice, how to and miscellaneous." When one book threatens to dominate a category (as Harry Potter did) they invent a new one just for that book.
This week's Times reports that James Frey's controversial book is still "non-fiction" (with a disclaimer) and that Malcolm Gladwell's fine books continue to be non-fiction as well (though mine are considered advice, how-to or miscellaneous, not sure which, not sure why). Dave Barry, surprisingly, doesn't write humor (which is miscellaneous, right?) or even advice (his new book parodies money books) but is, in fact, non-fiction.
It matters at the Times because the advice category is the most competitive and also the shortest.
The reason you should care about all this: you are in a category too. So is your organization.
And you have a lot of influence over what category you're going to be placed in.
For example, there are a lot of software products (fireclick, hitbox, etc.) that measure analytics. Unfortunately for these guys, in the very same category is Google analytics, which is free. Google is now the official short head of analytics, and as long as you are in the same category as they are, you're in trouble.
For example, there are a lot of software engineers looking for jobs. And some of those engineers have absolutely stellar backgrounds and great skills. As long as you are in the same category as they are (and there's only one slot available) then they get the short head advantage.
For example, there are a lot of blogs. Blogs that invent brand-new categories grow far faster than those that just live in an existing category.
Sometimes you want to be in a category unto yourself. This works with blogs or (sometimes) with blockbuster movies (ask Mel Gibson).
Squidoo was most intentionally placed in the Web 2.0 category. Not because it changed what the service does, but because the attributes and attention of that category were both a good fit and moving in the right direction (up). If you can join a category that is already generating conversations, you're more likely to get talked about.
Other times, you want to be in a category with a lot of churn that is proven popular. Like non-fiction books or cosmetics for teenagers. Here, the current short head leader won't last long, and if you're in the right line, you might be next.
What you don't want to do, it seems to me, is not pay attention to which category you are in. Pick your category and live and breathe and act appropriately for that category. Choose wrong (the way Pringles potato chips did) it might take years or longer for people to notice and embrace what you've built.