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This paper studies how audience members categorize and evaluate ambiguous offerings. Depending on whether audience members categorize ambiguous offerings based on prototypes or goals, they activate two distinct cognitive mechanisms and evaluate differently ambiguous offerings. We expect that when audiences engage in goal- versus prototype-based categorization, their evaluation of ambiguous products increases. We theorize that, under goal-based categorization, the perceived utility of unclear attributes increases for audiences, which leads them to evaluate more positively ambiguous product offerings. We test and find support for these direct and mediated relationships through a series of laboratory, online, and field experiments. Overall, this study offers important implications for research on product and market categories, optimal distinctiveness, and market agents’ cognitive ascription of value.

Product categories are more than classification devices that organize markets; when reflecting market actors' purposes, they are also judgment devices. Taking stock of the literature on product categories and drawing on the distinction between the faculties of knowing and judging, we elaborate a framework that accounts for how and why market actors include or exclude normative attributes in a product category definition. Based on a field study of the development of socially responsible investment (SRI) funds in France, we describe the phases and conditions of a judgment framework for category definition for both established and nascent categories. We discuss implications for research on product categories and the workings of markets more broadly.

International audience; We advocate for more tolerance in the manner we collectively address categories and categorization in our research. Drawing on the prototype view, organizational scholars have provided a 'disciplining' framework to explain how category membership shapes, impacts, and limits organizational success. By stretching the existing straightjacket of scholarship on categories, we point to other useful conceptualizations of categories - i.e. the causal-model and the goal-based approaches of categorization - and propose that depending on situational circumstances, and beyond a disciplining exercise, categories involve a cognitive test of congruence and a goal satisfying calculus. Unsettling the current consensus about categorical imperatives and market discipline, we suggest also that audiences may tolerate more often than previously thought organizations that blend, span, and stretch categories. We derive implications for research about multi-category membership and mediation in markets, and suggest ways in which work on the theme of categories in the strategy, entrepreneurship, and managerial cognition literatures can be enriched.