Blue Ocean Strategy

Profit margins are low, competitive rivalry is intense, and customer value is on a steady decline. If the unfortunate picture sounds familiar, it might be time for you to explore the blue ocean.

The Blue Ocean strategy took the business world by storm when it was first introduced in 2005. Since then, industry leaders and corporate giants have been investing in Blue Ocean courses in order to discover their own “uncontested market space” and to retain their market shares in today’s highly competitive economic landscape. After all, it is only common sense to move away from the vicious competition between the sharks of the Red Oceans, and instead inhabit the Blue Oceans where competition is little to none.

To help managers and executives create such innovative growth opportunities for themselves, our board of experts has designed Blue Ocean courses which will train you to develop your own unrivaled market space.

Blue Ocean Basics

A Blue Ocean training rests on the assumption that market structures and boundaries are not fixed. This means that the beliefs and actions of industry players can influence and rebuild the industry, and so, new industry spaces can also be found.

Traditional markets are called Red oceans: they are crowded with competition, face cutthroat ‘bloody’ rivalry (hence the name) thanks to commodification, and offer lower profit margins and stagnated growth. In contrast, blue oceans operate in a new, unrivaled market space where products create their own demand. The fundamental distinction between a blue ocean and a red ocean is the strategy followed: a red ocean will lead by either differentiation or low cost, while a blue ocean will straddle both differentiation and low cost. Thus, because of the differentiation, higher value for consumers is created, and through cost-leadership, lower costs for the company are ensured.

All of this is easier said in theory than applied in the industry, you say? Not really. Let’s look at a few examples of a Blue Ocean training in action.

How Blue is our Ocean?

The industry is packed with examples of market leaders employing the Blue Ocean Strategy. In fact, it would not be unfair to say that most, if not all, market turnovers owe their success to the Blue Ocean.

The raging success of iTunes as soon as it came out is no secret. Not only was it a success, it was ‘destructive success:’ old competition like CDs were made obsolete and kicked out of business! The credit goes to a blue ocean developed right. iTunes offered unprecedented value through legal downloads, convenient access, high quality audio, and interactive browsing. They also kept their production costs low by eliminating unnecessary middle-men under the ERRC Framework. Similarly, industry giants such as Ford, HP, Bloomberg, Amazon, and Marvel Studios have all made use of higher value at lower costs, and today, they have not only attained unbeatable positioning but also huge market shares.

And you can, too.

The Implications for You

When it comes to developing a Blue Ocean Strategy, the founders of the regimen identify five fundamental steps:

1.    Starting from the right place, with the right team of individuals.

2.    Obtaining a clear picture of the company’s internal and external environment.

3.    Identifying pain points and bottlenecks in the industry, and discovering a set of non-customers to aim to cater to.

4.    Systematically restructuring market limitations and developing unexplored opportunities.

5.    Choosing the appropriate strategy moving forward, conducting market tests, and launching the turnover.

It is these steps which form the basis of our Blue Ocean training, and through these you can make your firm command not only larger profit margins, but also superior consumer mind-share.