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In this paper, we conceptualize categories as regions of a cognitive map that structure the market and guide the investment decisions of potential entrants—i.e., of new and established organizations. We advance that, as a category appears altered via incumbents' acts of recombination, potential entrants face market-specific uncertainty and are discouraged to invest in that category. These negative effects of recombination on market entries are, however, mitigated at increasing values of category status. We test our arguments in the market for electronic music. The analyses of product and organizational entries in music styles between 1978 and 2011 lend support to our arguments.

In mediated markets, the categorization of products by mediators is critical to efficient interaction between producers and consumers. As organizational research tends to focus on the consequences of categorization rather than its antecedents, however, we know relatively little about why mediators assign one category label or another to a product. In this study, we argue that two informational properties of labels, specificity and distinctiveness, determine the outcomes of mediators' categorization decisions. Our analysis of product categorization decisions made by members of an online music community, 2000–2020, supports this argument. We find that a label's odds of being assigned to a product increase (a) if this label encodes information that is neither too similar nor too different from that which is encoded by a superordinate label, that is, it has moderate specificity; and (b) if it encodes information that differs as much as possible from that which is encoded by horizontally related labels, that is, it has maximal distinctiveness. These findings persist after controlling for other possible determinants of mediators' categorization decisions, including producers' claims to labels, products' typicality, and mediators' expertise. Funding: M. Piazzai received funding from the Community of Madrid [EPUC3M12, VPRICIT] and the Spanish Ministry of Science and Innovation [RYC2021-032325-I]. M. Liu received funding from Durham University Business School. Supplemental Material: The e-companion is available at https://doi.org/10.1287/orsc.2021.15751 .

We investigate the effectiveness of two types of impression management tactics implemented around negative attributes: egocentric (claiming the absence or low presence of a negative attribute in a focal organization) and alter-centric tactics (claiming the greater presence of a negative attribute in an organization's competitor). We claim that the effectiveness of each tactic depends on the risk of audiences' skepticism, which stems from the incongruence between the information conveyed in the tactic and audiences' default expectations about the presence of the attribute among members of a given market segment. Audiences expect a conspicuous presence of the attribute, we propose, the more stakeholders contest a market segment for that very attribute. Thus, we advance that egocentric (alter-centric) tactics are less likely to be effective for contested (uncontested) attributes because the information conveyed in such tactics clashes with audiences' default expectations, triggering skepticism. We find support for our predictions looking at the impact of nutrient content claims on product sales in the U.S. food retail industry between 2006 and 2015.Funding: H. Pinto de Sousa acknowledges the support, in the form of a research scholarship, granted by the Portuguese Foundation for Science and Technology (Fundação para a Ciência e Tecnologia), under the European Social Fund and the Human Capital Operational Program (Programa Operacional Capital Humano) funding program [Grant SFRH/BD/128536/2017].Supplemental Material: The online appendix is available at https://doi.org/10.1287/orsc.2022.1612 .