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Yesterday I began my review of EnlightenNext magazine and its conscious evolution from a newsletter to a mainstream, glossy publication. EnlightenNext is packed with in-depth articles ranging from business and politics to spirituality and science, and it asks deep questions about our culture, our spirituality and our social evolution. By changing its name and layout, EnlightenNext brings a professional and dynamic look to hard-hitting cultural topics.

This re-conception shows us a critical key to innovation: innovators blend categories to create new things.

Fairly early in our lives, we learn to simplify our complex environment by categorizing things. My 2-year-old son, for example, knows already that chocolate, ice cream, and cake somehow all fit together even though he does not know the word "dessert." By linking things together, we can "chunk up" our knowledge, as cognitive scientists and linguists call it, into higher-order categories. We then begin operating at the category level to free our mind from thinking about the details.

Now most customers live in sea of multiple categories that operate mostly subconsciously. They want to quickly slot a product or service into a category. When they cannot categorize something, then they face a tough choice – either create a new category or forget the product or service entirely. Usually, to save energy, consumers opt for the latter.

So when trying to create a new category, it is easier to link to categories that customers already know. Gatorade offers a great example of this in action. It was invented as a salty, bad-tasting drink to help football players hydrate. It was invented by University of Florida scientists who wanted to give their team, the Florida Gators, an edge. Hence the name Gatorade.

Gatorade’s popularity grew without attracting the interests of Coca-Cola and Pepsi because those soft-drink kings never felt that Gatorade fit into their drink categories. They sold soft drinks, and Gatorade was some kind of specialty sports product.

But because Gatorade combined two categories – sports rehabilitation and drinks – it created an entirely new one. And since Coca-Cola and Pepsi could not see that the new category could pull away loyal soft drink customers, it ignored Gatorade’s resolute growth for several years. Instead of acting, they watched Gatorade spread onto professional football fields, high school tracks, and middle-school physical education classes. They watched it catch on with soccer, basketball and baseball players.

Once Coca-Cola woke up to the fact that Gatorade could challenge its core business, it was already too late. Coca-Cola invested heavily on a competing product, but it was never able to catch up.

Innovators play with categories to attract customers and detract its competitors. Toys "R" Us, for example, was created when someone said, "Let’s make the supermarket of toys." Merrill Lynch was founded on the idea of making a "supermarket of financial services."

Executive editor Carter Phipps describes EnlightenNext’s position as "hip and cutting edge. It reflects the future and is about what’s coming tomorrow."

Perhaps then, the magazine is doing the same thing that Gatorade did. It is combining two different categories – taking a spiritual magazine that is often past-oriented, drawing on Buddhism and other older traditions and combining it with a forward-looking, glossy lifestyle magazine. If it continues to do so effectively, the magazine could create a completely new category in the magazine industry.

Creating categories is a great way to find new customers and offer new products. Ask yourself the questions below to see if there is a way you can combine or create new categories to help propel your company past the competition.

1. Can I blend two products, departments or services to offer something new?

2. How can I create a new category that I know consumers will embrace?

3. Do I see a need for my company to evolve in order to keep it moving forward and toward success?