The Blue Ocean marketing concept was created by W.Chan Kim and Renee Mauborgne. They are professors at a private university called INSEAD. They published their ideas in the book, Blue Ocean Strategy, in the year 2004.
Their ideas have become a massive hit transforming into an industry of its own. Numerous books have been published and websites have listed courses based on the theory.
Before taking in a mountain of information, it’s best to start with the basics. What are the drawbacks and the success stories?
Let’s investigate if the Blue Ocean Strategy would be appropriate for your business!
The concept of Blue Ocean marketing is a fundamental reset of how you approach a business and the marketing associated with it. The strategy encourages entrepreneurs to seek out uncontested markets and discover the unmet demand in them. This approach does not necessitate learning new skills or seeking out new resources. Instead, it requires using your current expertise and resources to meet the current and also potentially non-existent consumer demand.
The idea is not to compete with your competition but to explore untapped markets where the demand isn’t identified and fulfilled. The highlight is that consumers themselves may not realise that they want something. Demand is now being created with your unique product. Such a strategy requires creativity and extensive planning.
The Red Ocean Strategy is the polar opposite of the Blue Ocean Strategy. Major corporations and industries compete using these methods. This method entails the process of carving a niche for the company among competitors. The strategy exists to make a brand new product survive and profit in a competitive market. The end goal of this approach is to outlive the competition.
There are certain straightforward differences between these two strategies. Under the red ocean strategy, to stay competitive the focus is maintained on gaining an edge, generally by analysing what the competitors do and aiming to do better than them. The aim is to divide the market the competition has, where the growth is usually limited.
As per the Blue Ocean strategy, the focus is on creating a new demand, rather than focusing on the supply of a product. The strategy is in shifting the focus from the competition to focusing on creating a brand new market for themselves. The highlight of employing this strategy is in acknowledging the idea that there is nothing as attractive or unattractive. Since the perception of what is attractive or not is influenced by companies.
The course and process of a blue ocean strategy in a company require moving yourself, the team, and the entire business from competitive markets to brand new segments of the market, which are controlled by your team.
For an effective transition from a red ocean to a blue ocean market, three vital components are required:
- A roadmap with market-creating tools
- A clear perspective of the end goal
- Being able to boost the confidence of team members at every level
One of the best examples of the application of the blue ocean strategy is the introduction of Apple’s iPhone. Before 2007, none of us thought of having a handheld device that could be as powerful and fast as a personal computer. The concept of a touch screen was remote. Steve Jobs and Apple used the resources at their disposal to create a brand new market for themselves.
Blue Ocean Strategy has not only propelled several businesses to the top, but it has also enabled businesses to carve out their niche. It has improved all our lives with advancements we may not have realised we needed and can’t live without it anymore.