...Blue Ocean Strategy Shawn Good MKT/421 August 18, 2014 Mark McClintock Blue Ocean Strategy If a company wants to be an overachiever, sometimes a company needs to venture out in untested waters to see what can happen with a product or service it will offer. Companies can find out if what they are offering will be successful or not, instead of being complacent in companies doing the same thing. There are two strategies to companies doing something new called blue ocean strategy. Or the strategy of doing the same thing over and over called red Ocean strategy. Blue Ocean Strategy Blue ocean strategy can be defined as “the unknown market space, untainted by competition” (Kim & Mauborgne, 2004). Blue oceans are started in two ways, one being a company starting a new industry that has yet to be tapped. The second way is when a company looks at how to improve or alter the product in the current industry. Blue ocean strategy is important to any company in any industry. Using blue ocean strategy will allow the company to remain viable and to keep their customer base energized by the product they offer. Blue ocean strategy allows the companies to look at the possibility of recreating themselves which could lead to new customers and improved profits. It allows companies to look at the big picture instead of having the blinders only to see directly in front of them instead of around them. Example of a Blue Ocean Product or Service A product example that falls...
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...thought of as an ocean. The ocean can be divided into two segments: the red ocean and the blue ocean. The red ocean is comprised of existing market segments and this space contains all things in existence today. The competition in this space is fierce. Conversely, the blue ocean represents all things not in existence today or the opportunity to reengineer an established industry. The framework for formulating a Blue Ocean Strategy is explained in the following paragraphs. The first principle is reconstructing market boundaries. When creating a Blue Ocean Strategy, an entrepreneur must look within an existing industry and think beyond the current boundaries. Reengineering an established practice within an industry or creating something new will enable an entrepreneur to create a new market segment or maybe even a new industry. The company should look across alternative industries, consumer groups, and at other products or services that may help complement their own. By utilizing this cross-cultural approach, opportunity is created for the growth and development of a new market. The second principle when initially creating a strategy is for an entrepreneur to focus on the big picture and not the details. If the big picture is understood, the details will be easier to put into place. Without a big picture focus, creativity and innovation could get lost in the details. Corporate strategy must include big picture thinking. Breaking into a blue ocean market requires...
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...Blue Ocean Strategy Blue Ocean Strategy The principle of a Blue Ocean Strategy is when a business reinvents itself within its given market to make them stand out as different from the rest of the competition. A company does this by an area within the market that is untouched or has low competition. According to Chan and Renee (2004) “Competing in overcrowded industries is no way to sustain high performance. The real opportunity is to create blue oceans of uncontested market space.” An example of a business that is currently doing this is Tesla Motors. Several car companies have released electric or hybrid cars, but they have all been unaffordable, and never stylish. The only company that has made them and actually focused on making them appeal to consumers is Tesla Motors. A red ocean move that Tesla could have taken would be to just enter the automotive market and build conventional vehicles. They could have made their vehicles so they are a hybrid, or just gas powered only. The biggest pros of this are that the technology is already there and it would be easy to make the cars affordable. Less money would have been spent in research and design and they could have been mass produced rather quickly. But, it is the cons of being in a red ocean that drive a business to enter the blue ocean. The cons of using a red ocean strategy are that the automotive market is heavily saturated. The companies that are already making conventional vehicles are very well established and has the...
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...The Blue Ocean strategy in marketing is a unique approach to building a customer base. Instead of trying to compete in an overcrowded marketplace with existing companies, a Blue Ocean strategy seeks to build an entirely new market area. With the rapid growth of technology and globalization, the importance of a Blue Ocean strategy has grown in recent years. The “Blue Ocean strategy” is a term that originated from the 2005 book, The Blue Ocean Strategy, by W. Chan Kim and Renee Mauborgne that describes the opportunities of vast, untapped market spaces, or "Blue Oceans," that can be developed by expanding market boundaries or launching new industries. The concept of "Blue Ocean strategy" was first acknowledged by the business world in 2005 when the correspondence was initially released. In essence, Blue Oceans are associated with high potential profits. Since it’s released it has been translated in 43 languages. The authors discuss the benefits for business owners to leave the Red Ocean, characterized by the bloody, shark-infested waters of competition, and enter the Blue Ocean, where there is no competition and limitless space to create something new. According to inserts found throughout the book, it is important to evaluate your business to determine whether you should rethink your market strategy and enter the "Blue Ocean." The most important feature of Blue Ocean strategy is that it disregards the basic principles of conventional strategy: that a trade-off exists between...
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...Visi Pramudia http://visipramudia.wordpress.com/ BLUE OCEAN STRATEGY Authors: W. Chan Kim – Renee Mauborgne How to Create Uncontested Market Space and Make the Competition Irrelevant Visi Pramudia http://visipramudia.wordpress.com/ I. THE STRATEGY Visi Pramudia http://visipramudia.wordpress.com/ New Market Space known market space RED OCEAN Represent all the industries in existence today BLUE OCEAN Denote all the industries not in existence today space Circus Industry Traditional Circus: • Target Market : Children • Dependent to : Star performance, animal shows • High fun & humor • High Thrills & dangers unknown market Cirque du Soleil: • Target Market : Adults • Not Dependent to Star performance & animal shows • Reduce fun & humor • Reduce Thrills & dangers • Unique Venue • Theme & Theater Low Cost, High Price High Cost, Low Price Visi Pramudia http://visipramudia.wordpress.com/ The Cornerstone of Blue Ocean Strategy • Value innovation is created in the region where a company’s actions favorably affect both its cost structure and its value proportion to buyers • Cost savings are made by eliminating and reducing the factors an industry competes on • Buyer values is lifted by raising & creating elements the industry has never offered • Over time, costs are reduced further as scale economies kick in due to the high sales volumes that superior value generates The Simultaneous Pursuit of Differentiation and Low Cost Visi...
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...Blue Ocean Strategy MKT 421 Blue Ocean Strategy Description of Blue Ocean Strategy and its Significance According to Cham Kim and Renee Mauborgne (2004), the Blue Ocean strategy involves the description of how the organization should try and proceed to find some way to work in the marketplace that is not bloodied by the competition and also that is free of competitors. The strategy is against working in conditions such as Red Ocean, where businesses are fighting each other for some share of the marketplace. In essence, businesses are most often looking for ways that can better contend with their competitors, and that is the Blue Ocean strategy. According to the book, Blue Ocean Strategy, the leading companies succeed not by battling with competitors, but by systematically developing “Blue Oceans” of uncontested market space ripe for the growth. Such a strategy of Blue Oceans entails the simultaneous pursuit of differentiation and also low cost, including the theory behind it not to outperform the competition in the on-hand industry, but to develop new market space or rather the “Blue Ocean”, in which case it makes the competition irrelevant. As such, the Blue Ocean strategy illustrates the opportunities of vast and untapped market spaces (Kim & Mauborgne, 2004). The Blue Ocean strategy is quite important. This is because it allows some business to sell its products with no or little competition from other firms. It is also significant...
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...02/05/2013 Article: Harvard, Blue ocean strategy “Competing in high overcrowded industries is no way to sustain high performance. The real opportunity is to create blue oceans of uncontested market place.” This quote that is on the top of the first page just about sums up the article, but I will go further in depth in what the article says. What is the best way to drive profitable growth in an industry? Or company? According to the article it is to enter into the market place that is not existent today that has no or little competitors. This is known as blue ocean. Red ocean on the other hand is the already existent market place that has a high number of competitors; all of the boundaries are already defined and accepted. The article refers to red ocean as a war because competitors battle against one another for market share and ultimately are trying to put the other out of business. The competition can be bloody and downright cut throat. The article encourages business to make a switch from the red ocean strategy to blue ocean strategy. Cirque Soleil is a prime example given that used blue ocean strategy. The circus idea was not new, but actually an unpopular event at the time that Cirque Soleil became a main hit. Cirque Soleil broke from a red ocean into a blue ocean (where most blue oceans are created) by breaking through the traditional boundary of separating circus and theatre. The other way that a company can become blue ocean is to give rise to completely...
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...ANALYSIS The article in Harvard Business Review, Blue Ocean Strategy written by W. Chan Kim and Renee Mauborgne, gives an insight to how Cirque du Soleil has implemented a Blue Ocean Strategy when creating its business. This article provides examples for examining alternative purposes and approaches of Blue Ocean Strategies. It appraises the benefits that a Blue Ocean Strategy brings a company by expanding its growth and profit in a much faster speed. It achieves these benefits by creating new market space and making competition irrelevant. The analysis of Blue Ocean Strategy focuses on creating new markets and industries. Its methodology is to compare the Red Ocean Strategy with the Blue Ocean Strategy. The comparison gives detail to the most important difference between the two strategies, which is the market they target. While a Red Ocean Strategy is referring to an industry that is already well established in the market place and pretty much has attained its peak in popularity. In this Red Ocean Strategy if you were to come in as a new business it would be to compete at the same level and perhaps just trying to outperform your competitor in order to take a share of the demand already in existence for that industry. But, when talking about the Blue Ocean Strategy, the ideology gives a 360 degree shift. In a Blue Ocean Strategy the demand is created by introducing something completely new. You produce a new business which has not been introduced before and therefore,...
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...Blue Ocean Strategy In the article, two types of business space defined. First one is red ocean and other is blue. Red oceans are the markets and businesses we know. Rules of the existing markets are well defined. When all the variables are known and equally effect the players in the market, all players think somewhat the same thing and generate close strategies like in the game theory /prisoners dilemma. Generally, their options are in between differentiation and low cost. Either way companies fac e ruthless competition, slightly differentiated offerings with minimal costs. This environment is the hardest to survive while the demand for known markets are not increasing. On the other hand there some companies that are not suffering by the ultimate competition even they are not in a monopoly. They explored and defined new markets that only they can fit in with the blue ocean strategy. In this case, famous Cirque du Soleil achieved Demand for circus was decreasing and this company has to do something as others in the market. Instead of lowering the costs or differentiating themselves with traditional ways they differentiated the market from a classical circus to a something offers an artistic value. They took some shows out which were costly but not demanded anymore and added some values to the circus that could attract even older people and generate higher profit. They are more than a circus right now more close to theater or other performing arts. The idea behind...
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...Blue Ocean Strategy Shovanda Davis MKT/421 July 13, 2015 Nnamdi Osakwe Blue Ocean Strategy Introduction This week we will discuss Blue Ocean Strategy in detail. We will provide a description of blue ocean strategy and its importance. We will also discuss a product or service that might be considered a blue ocean move and why. We will also talk about an alternative red ocean move for the same product or service along with the pros and cons of that strategy. Description of blue ocean strategy and its importance Blue Ocean Strategy is a term that describes how companies customarily work in "red ocean" conditions, where businesses viciously fight against each other for a share of the marketplace. Instead, according to the blue ocean strategy, organizations should find a way to work in a marketplace that is free of competitors (Arline 2015). Blue Ocean Strategy is where leading companies will prosper not by fighting competitors, but by creating "blue oceans" of recognized market space ready for growth (Arline 2015). Blue Ocean Strategy is important because it is easier for many companies to produce more of their product because of technology advances. It is also important to companies to enter the blue ocean to find new opportunities. Blue Ocean Strategy makes the competition irrelevant. Product or service that might be considered a blue ocean move and why There are several products and services that might be considered Blue Ocean. Cirque du Soleil is an example...
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...Blue Ocean Strategy Danny Speed MKT/421 23 June 2014 Stephen Grothe Blue Ocean Strategy There are many different strategies in the market today that assist a company with getting ahead of the competition. Blue and red ocean strategies are important in this regard. A company can utilize the objectives outlined in these strategies to exceed their own expectations, as well as those of their competitors. One way to differentiate between the two strategies is that using blue ocean strategy, the ocean is nice, calm and blue; while, when using red ocean strategy, the ocean is rough and red with the blood from fierce competition. Blue ocean strategy has been around for hundreds of years, even if people didn’t realize it at the time. During the industrial revolution, nearly every product coming out was new and innovative for that period of time. Essentially, every product coming out was following blue ocean strategy. Blue oceans occur when the product being introduced to the market have no direct competition; which, is a much easier way for a new company to enter the market. When entering a red ocean strategy, a new company will have a good amount of trouble competing with already established companies and products. It is very easy for blue oceans to turn red once other companies see the profitability of a certain product and try and join that particular market. The goal in a blue market is for a company to create a product and customer following that will make any...
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...Blue Ocean Strategy Melissa Keck June 5, 2014 MKT421 Dr. Linda Murawski Blue Ocean Strategy Competing in overcrowded industries such as technology is no way to sustain high performance. The real opportunity is to create blue oceans of uncontested market space. The Apple Ipad and Kindle Fire would be considered Blue Ocean products as oppose to Red Ocean products. Apple achieved a worthy invention by designing the Ipad, which led to the creation of a new market space. Apple intrigued consumers with the limits of the space by educating customers on its comprehensible use. Amazon introducing the Kindle Fire shortly after the Ipad which targeted non-Ipad users and defined its own name by developing the Kindle Fire as a media savvy device with prominent features enabled by Amazon’s massive media platform. Both of these similar but distinctive products made the competition irrelevant. According to Kim and Mouborgne (2004), “Blue Ocean strategy is simply creating an uncontested market space and defining its boundaries rather than competing in the confines of an existing industry”. As the space for products get more and more crowded, projections for profits and growth are condensed. Blue oceans represent all the industries not in existence today in the unidentified market space, untainted by competition (Kim and Mouborgne, 2004). In blue oceans, demand is created rather than fought over. There is sufficient opportunity for growth that is both profitable and prompt. Companies...
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...Blue Ocean Strategy Paper KT/421 What is Blue Ocean Strategy and its importance Blue Ocean strategy is a strategic form of marketing which ideal model is to be different in a new market place. Blue Ocean strategy goal is to create a new way of marketing instead of common forms of marketing such as competiveness. Another one of Blue Ocean strategy goal is to set the pace with unique products with profit gain in new markets. Blue Ocean believes in leaving the ways of Red Ocean which is characterized by unmorally hills of competitions. Blue Ocean strategy is imperative because most prospects in Red Ocean established market places are consistently reducing. Today’s technology has drastically improved industrial production which is now allowing suppliers to produce product at a massive amount in a short amount of time. Blue Ocean is also important in the American Market. In the American Market brands are becoming more and more similar. Therefore, customers are no longer basing their purchase decisions on brands but more so on prices. Product or Service that night be considered a Blue Ocean Strategy An acceptable example of a Blue Ocean Action is Apple’s iTunes. In 2003 Apple confused into the agenda music amplitude as a provider and benefactor of agreeable – and signaled the end of the antecedent innovation, the CD. Apple created iTunes as online account area customers could download legal, top superior songs for a actual reasonable price. ...
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...Blue Ocean Strategy Paper In today’s global economy, many companies are competing each and every day for the same customers. On the other hand, the elite companies are sailing in uncontested waters by being innovative and creative in obtaining profit and growth. Research spanning over 100 years in thirty industries was conducted, and the result was astonishing. The conclusion of the research was that companies need to stop competing head-on in existing industry space because they should make competition irrelevant. How do you make competition irrelevant? What product or service can fall in this innovative strategy? What is the alternative to this strategy and what are the pros and cons? First of all, how to make competition irrelevant? Blue Ocean created by W. Chan. Kim and Renee Mauborgn is Strategy based on 100 years long study of more than 150 strategic moves, spanning more than 30 industries. It pursues differential and low cost. Blue ocean strategy is based on the simultaneous pursuit of differentiation and low cost. It creates uncontested market space because it doesn’t aim at competing nor does it aim at outperforming the competition; rather it aims at making the competition irrelevant by reconstructing the industry standards and boundaries. Blue ocean strategy uses tools and framework to break away from the competition. By doing so, it creates new market space. Blue ocean strategy starts by assessing the current state of play in an industry to exploring the new market...
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...Blue Ocean Strategy Paper University of Phoenix Marketing MKT/421 Michael Wells June 10, 2014 Blue Ocean Strategy Paper Blue Ocean Strategy is a business strategy for businesses to overcome ones competition in a unique way that will separate themselves from the competition. According to Kim, W., & Mauborgne, R., “The blue ocean include the potential industries that do not exist at present and all the untapped market spaces and demand demographics that will take shape as and when such created from scratch” (2004). The blue ocean can be brought up two different ways, one by being completely new to the industry and there is nothing quite like it in comparison. The other would be created within the red ocean by copying some of it functionality but not all. The blue ocean is the reason why there is so much competition. Everyone is looking for the next best thing. Innovations and plans coming into reality and being the only product of its kind out there. The marketing business thrives on new products how it can be introduced to the public and if its cost worthy. Companies can succeed more if they think out of the box for the next best thing that has not been introduced before and will blow the consumer mind and will make everyone want one. When this occurs it place the company in the spotlight and it makes consumers aware of the new product as well as other products the company offers. Curves franchise began in 1995. There were a lot of health clubs out...
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