Research on category emergence has primarily focused on actors within a single category, neglecting how inter-category dynamics influence societal-level category trajectories and persistence. In this study, we explore the distinctive processes of category nesting and co-evolution by conducting historical, processual analyses of the “New Chinese Domestic Products” category (Xin guohuo). Our findings identify a dualism dynamic of the simultaneous embedding of new practices and the framing of meaning codes between the focal societal-level category and partially oppositional incumbent category. These interactions transform ideological counterpoints into nested entities that co-evolve toward a shared structure of converged ideals. Our process model highlights the critical roles of new category members and incumbents in shaping category goals and ideals through iterative strategy work across related categories. We also uncover the risks of collaboration, including decoupling activities hidden under shared labels, which threaten category coherence. These findings offer new insights into societal-level category emergence, inter-category dynamics, and the pivotal role of incumbents in constructing and stabilizing emerging categories.
