In this article you will learn how to make your competition irrelevant and have sales and profit growth in excess of anything you thought was even possible. Blue ocean strategists have always existed but for most part their strategies have been largely unconscious. The difference between traditional circuses and cirque du soleil is that the. The fighting results in a red sea, because much of the energy is spent competing. Here, grabbing a bigger share of a finite market is seen as a zerosum game in which one companys gain is achieved at another companys loss. The blue ocean strategy has been used by companies like cirque du soleil to completely redefine the industries they entered by turning the conventional industry boundaries on its head. Red ocean versus blue ocean the strategy is specifically a marketing theory and thus, a marketing strategy. Based on the book blue ocean strategy, a red ocean is defined as a market where multiple competitors fight for the same customers.
How to create uncontested market space and make the competition irrelevant from the worlds largest community of rea. For that there is nothing better than something called the blue ocean strategy. Looking at entire industries in this way allows you to tell over time whether an innovation strategy or a competitive strategy is best. Innovation, new market space and creating demand are central characteristics. A company will have more success, fewer risks, and increased profits in a blue ocean market. Search for your own blue ocean, where you can take your time and almost name your price. Blue ocean strategies on february 12, 2020 blog, b2b strategy and messaging, virtual vp of marketing it can be difficult to succeed with the cutthroat competition in the business environment today. The chart above summarizes the distinct characteristics of competing in red oceans red ocean strategy versus creating a blue ocean blue ocean strategy.
Amazon continually looks to create and implement blue ocean strategies. Blue ocean strategy is a marketing theory and the title of a book published in 2004 that was. The mental models that undermine marketcreating strategies. This blog article is a overview of some of the key points of the book by w. In blue oceans, demand is created rather than fought over. Blue ocean strategy including examples and pdf download. Even though, recently, white ocean has emerged in world business strategy. Strategy, blue ocean, red ocean, competition, market share. Summary of the first four chapters of the international bestseller blue ocean strategy.
Another great example of a blue ocean product is the cirque du soleil, highlighted in the book blue ocean strategy. Red ocean and blue ocean strategies comparison table. The expanded edition of blue ocean strategy, is metaphorical, witty, and almost biblical in its commentary of the bloody waters of competitive red ocean market forces. Blue vs red ocean endicott masters in international admin. Like the blue ocean, it is vast, deep and powerful in terms of opportunity and profitable growth. Blue ocean strategy is where a company creates a completely new market space or market category. Home blue ocean strategy powerpoint template red ocean and blue ocean strategies comparison table red ocean and blue ocean strategies comparison table this slide provides the comparison between strategic factors of traditional competitive strategies red oceans markets and the new innovative and unexplored markets blue ocean. History and background a video game console is just a computer that is made only. And if you like having books to refer to it is a nice one to have. Red ocean strategy aligns the whole system of the company and its activities with its strategic choice of differentiation and low cost, on the other hand blue ocean strategy supports the entire system of the company and its related activities in recreation of. Just compare the experiences of apple and microsoft. We will introduce the aspects of red ocean strategies that most of the companies use around the world, and then we will compare the advantages and. A blue ocean strategy may come out of a red ocean strategy.
The authors conclude that the blueocean strategy or innovation approach is sustainable. Blue ocean strategy the maturity of an industry has brought a company swimming in a red ocean, which means price war strategy, according to a bestseller book titled blue ocean strategy that is written by w. Blue ocean vs red ocean strategies 6 major differences. Fundamental difference between red ocean strategy and blue. Blue ocean strategy is a book published in 2005 and written by w. Chan kim and renee mauborgne, the writers of the 2005 book blue ocean strategy. Companies that are already in existence may make a solid decision to come out of the usual way of doing things and go into uncharted grounds. However, the question is, what books are in the blue ocean.
They represent businesses that may not be around today, or werent around until they came on to the scene. A red ocean is a metaphor for a market full of competitors. There are two types of oceans in this world, according to authors w. How to create uncontested market space and make the competition irrelevant, a book by professors w. In red oceans, there is a competitiveadvantage worldview. The namesake blue ocean means untouched waters, or no competition whereas red ocean is a market in which competition is at each others throats, spilling blood therefore red ocean for sales from customers. Red ocean basis of competition is trying to get a bigger share in the same defined market. The researchers called this the red ocean, analogous to a shark infested ocean where the sharks are fighting each other for the same prey.
To understand red ocean strategy let us begin by defining blue ocean strategy. Blue ocean strategy is a marketing theory and the title of a book published in 2004 that was written by w. Value innovation strategy competes in an uncontested market space. For example, competing factors in blue ocean strategy are similar to the definition of finite and infinite dimensions in funky business. There is a defined market, defined competitors and a typical way to run a business in any specific industry. Red ocean in blue oceans, demand is created rather than fought over. Blue ocean strategy suggests that an organization should create new demand in an uncontested market space, or a blue ocean, rather than compete headtohead with other suppliers in an existing industry that is called red ocean.
Based on a study of 150 strategic moves spanning more than 100 years. So far, blue ocean support relies on a data base of case studies that does not statistically analyze overall patterns. To sustain themselves in the marketplace, red ocean strategists focus on building advantages over the competition, usually by assessing what competitors do and striving to do it better. Recognized as one of the most iconic and impactful strategy books ever written, blue ocean strategy, now updated with fresh content from the authors, argues that cutthroat competition results in nothing but a bloody red ocean of rivals fighting over a shrinking profit pool. That is, you are swimming in a blue ocean, largely devoid of the competitors fighting in the commoditized red ocean space. The goal of a blue ocean strategy is for organizations to find and develop blue oceans uncontested, growing markets and avoid red oceans overdeveloped, saturated markets. A landmark work that upends traditional thinking about strategy, this bestselling business book charts a bold new path to winning the future.
Red ocean blue ocean bloody competition why competeto take a larger share when you dontin the market have to. Basis red ocean strategy blue ocean strategy industries red oceans represent the fiercely competitive arena where most companies compete blue oceans, denote all the industries not in existence today the unknown market space, untainted by competition. There is ample opportunity for growth that is both profitable and rapid. In this 5 minute blog, ill tell you what the difference is between a red ocean vs blue ocean and how you can survive a red ocean and swim into a more profitable and audible blue one.
A blue ocean, as used in the title of this book and strategy, is basically uncharted territory in the business world. For starters it should understand the six red ocean traps. Discussion blue ocean strategy versus red ocean strategy every blue ocean company would ultimately reach to the level of red ocean category as. With a focus of not just beating your competition but making them irrelevant, blue ocean strategy is all about thinking outside the box. Blue ocean strategy and why you should be using it. Once companies realize that blue ocean strategies have a different underlying. Beyond competing proven steps to inspire confidence. The red ocean was referred to as the existing market space, whereas the blue ocean was seen as the. Of course, the blueocean approach to this model would call. These systems started to gain popularity in the 1970s with consoles that played only pong. Red ocean looks at cost saving or differentiation while blue ocean focuses on doing both. Made by group d of the minor global trendwatching 2015. It asserts that for businesses to win in the future, they must stop competing.
In the decade since the publication of the first edition of our book, blue ocean strategy, weve had conversations with. Highly recommend this book to all the guys who want to make difference in their career. Competing in red oceans dominates the current field of strategy in theory and in practice, even as businesses need to create blue ocean strategy heightens. See comparison between red and blue ocean strategies here in one simple table. In the red oceans, industry boundaries are defined and accepted, and the competitive rules of the game are known. What is the difference between red ocean and blue ocean strategy.
They assert that these strategic moves create a leap in value for the company, its buyers, and its employees while unlocking new demand and making the competition irrelevant. Below is a list of 5 books that are currently slipping under our noses with very little competition. Blue ocean strategy is the most successful book on business. They defined todays markets as either being a blue ocean or a red ocean, with the latter being the one most companies operate in and the one we all understand best. Well, obviously its the books everyone has stopped talking about. Unlike the red ocean strategy, the conventional approach to business of beating.
How does blue ocean strategy differ from red ocean strategy. What is blue ocean strategy about blue ocean strategy. Competitive rules of the game are wellknown and predefined. Their book teaches readers how to create uncontested markets for. What is the difference between red ocean and blue ocean. Essay about blue ocean strategy 825 words bartleby. As market structure is changed by breaking the valuecost tradeoff, so are the rules of the game. This new market space is created by launching new offerings, with the aim being to make the competition irrelevant so that an organization can grow, uncontested, at least in the beginning. I wish i could say my own pursuit of enlightenment led me to chan kim and renee mauborgnes masterpiece on embracing and leveraging difference.
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