There is this hierarchy of genres in literature. From most to least prestige and renown, it goes:
Prose - Poetry - Drama - Essay - Graphic Literature (graphic novels, graphic poetry...)
When most people use the word "literature" on a prototypical level, excluding the other literary genres (at the subordinate level of vertical polysemy), they are always referring to prose, the dominant genre since the Victorian era. The other genres have been underrated ever since.
But the boundaries are not clear-cut. A story can be told in any of these five ways, actually. A nice style exercise would be to retell a short, familiar story (Red Riding Hood, Goldilocks, the Princess and the Pea...) in all five genres, Five Obstructions style.
Then there are the works that are liminal. Is Beowulf, or the Homeric epics, prose or poetry? Originally it was narrative poetry, bridging this gap, but most translations are literal, prosified. Closer to prose.
Are Lemony narrators' digressions prose or essay? There's another case of genre liminality. Don Quixote's speech of academic vs. military life, for instance... is Cervantes, through his hidalgo, giving us a snippet of essay in the middle of the prose or is it just a soliloquy in the prose world?
When we've got Hamlet, or Iago, giving us a soliloquy on human nature (whether on page, stage, or screen)... is it drama or essay (or poetry, if it's in pentameter)?
Is The Invention of Hugo Cabret a prose or a graphic novel?
Genres in literature will intersect and have fuzzy boundaries, in these cases. It's these points where boundaries blur that make literature have part of its allure for me.