Everyone can suggest you for a startup entrepreneur or an upcoming business person is that you need to know your market. Some might mention various strategies. Blue Ocean Strategy for a successful business is one 0f them. Usually, when we enter the business world, the market is always set and full of competition. Thus, it is a constant fierce battle to reach on top that just gets tougher and tougher with time.
You will have to use various strategies for your business to flourish. The blue ocean strategy for businesses is one such strategy. This strategy demands you to create your market rather than debuting into one. We will have to first understand what the blue ocean and red ocean are. To understand the blue and red ocean strategy, this article will help you get introduced to them and help you achieve success.
Professor W. Chan Kim and Professor Renée Mauborgne published a book in 2004 that brought a revolution in the world of business and changed the way of how people viewed the market.
This book was not a normal book that taught businessmen the ways to reach on top by leaving their competitors behind. This book was divided into three parts and taught people a strategy where instead of entering a red ocean, the authors encouraged them to enter a blue ocean.
Here, the ocean refers to the market where the businesses take place. The red ocean denotes the market that already exists in the present. It includes all the industries and businesses that are thriving in the business world.
There is always a fierce competition between the businesses in a market that already exists. It is not less than a battlefield. Everyone wants to reach on top. Hence, the cut-throat competition exists. This existing competition turns the ocean red, thus, the name red ocean.
Blue ocean, on the other hand, refers to the unexplored market where the potential of development is still not unleashed. It includes the industries that are still not in existence today and remains as the unknown market space.
Blue oceans are the unexplored market space. Here the competition is very less and doesn’t almost exist. The blue ocean is untainted by competitions. They are deep, vast and full of opportunities that are yet to be explored.
The author incorporated these ideas of the Red ocean and the blue ocean and hence, introduced us to a new marketing theory called Red ocean strategy and blue ocean strategy.
This strategy is all about the competition that exists in the current market. In the red ocean the more businesses that competitors, the fiercer the competition gets. The market space is very crowded here. There is no way you will be reaching on top here if your business does not have anything to better provide. Red ocean strategy is all about beating your competition and getting on top by getting the largest share of the limited demand.
Competing in a red ocean will only end up in two ways. Once you get on top, others you remain below. Here this marketing strategy divides the existing wealth to all the companies that are there. The more the competition increases, the lesser are the prospects for the profit and loss.
Blue Ocean Strategy is about creating a new market space where both you and your competitor can co-exist without a cut-throat competition. It’s about exploring the business opportunities where no one else had dwelled before. Here the companies focus on developing tools that will increase the prospect of the market rather than fighting for the small pool of profit.
This strategy will help people find the blue oceans where the rate of success is high and the risk of failures is less. It will open a new gate for better possibilities where everyone can thrive together. It will create and capture the unexplored market space and construct the boundaries of the market.
iTunes: With the launch of iTunes Apple opened a whole new era of digital music. It brought an end to the illegal music sharing trend and changed the course of music from CDs to digital form.
Ralph Lauren: Ralph Lauren the U.S. based designer created a blue ocean of “high fashion with no fashion”. He understood the factors that determined buyers’ decisions and traded up and down from one strategic group to another.
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