Cirque du Soleil redefined the market it wanted to enter and tapped into a previously neglected customer base: adult theatre-goers. By combining elements of the theatre and the circus, Cirque du Soleil was able to increase performances and prices, while at the same time cutting a majority of the costs by getting rid of animal acts. It had created its own blue ocean - an uncontested, new market space.
Blue Ocean Strategy Ebook Pdf 12
In many industries these days, supply exceeds demand. And as a result, most companies concentrate on the red waters of competition. Outbidding competitors, dividing up market shares, and focusing on an ever-shrinking target customer market are common business practices. To successfully lead a business, however, you must leave your competition behind. You need to create a blue ocean, which is an entirely new market, full of untapped buyer potential.
Now that you know what the market looks like, you need the Four Actions Framework to create your blue ocean: eliminate, reduce, raise, and create. First, look at ways in which you can reduce costs by asking the following two questions:
Finding the blue ocean can be difficult. How, in face of the endless possibilities, can you define the one business model to reconstruct the market boundaries? Luckily, there are a few basic approaches that you can follow, and these are applicable across all industries.
The chain of buyers also offers options for the creation of blue oceans. There are purchasers, users, and influencers. A specific industry usually converges around one of these buyer groups. Pharmaceuticals are targeted at influencers (the doctors), while the clothing industry focuses on the user.
To maximize the size of your blue ocean - meaning your future customer base - you must stop looking at existing customers and focusing on their differences. Instead, look at the people who are not your customers yet, and focus on what most buyers value about your product or service. There are three tiers of noncustomers: the first tier is closest to your market, or, people on the edge of the industry who only purchase goods out of necessity.
To create your blue ocean, you first need to know the industry in which you are operating. Who are your competitors? Who are your customers? Once you have drawn up a strategy canvas, you can look at paths to redefine the industry by looking at alternative industries, external trends, or complementary products.
Another question is regarding the relationship between blue ocean strategy and low-cost strategy. Is blue ocean strategy basically a low-cost strategy, i.e., is it about capturing the low end of a market with a low enough price? (www.blueoceanstrategy.com). The answer is No; blue ocean strategy pursues differentiation and low cost simultaneously by reconstructing market boundaries. A blue ocean strategic move captures the mass of target buyers not through low-cost pricing, but through strategic pricing. The key here is not to pursue pricing against the competition within an industry but to pursue pricing against substitutes and alternatives that are currently capturing the non-customers of your industry.
Blue Ocean Shift is the essential follow-up to Blue Ocean Strategy, the classic 3.6 million copy global best seller by world-renowned professors W. Chan Kim and Renee Mauborgne. Drawing on more than a decade of new work, Kim and Mauborgne show you how to move beyond competing, inspire your people's confidence, and seize new growth, guiding you step by step through how to take your organization from a red ocean crowded with competition to a blue ocean of uncontested market space.
In an audiobook that challenges everything you thought you knew, W. Chan Kim and Renee Mauborgne assert that tomorrow's leading companies will succeed, not by battling their rivals for market share in the bloody "red ocean" of a shrinking profit pool, but by creating "blue oceans" of untapped new market spaces ripe for growth.
In this perennial best seller, embraced by organizations and industries worldwide, globally preeminent management thinkers W. Chan Kim and Renee Mauborgne challenge everything you thought you knew about the requirements for strategic success. 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.
How Ted Dacko, the CEO of Ann Arbor-based HealthMedia, set out to apply the blue ocean approach and tools to the company, which at the time had a mere $6 million in sales. The result: HealthMedia created the new market space of digital health coaching, and in two short years was sold to Johnson & Johnson for $185 million.
At its core, there is value innovation, for which uncontested markets are created, where competition is made irrelevant. And the cost-value trade-off is broken. Thus, companies following a blue ocean strategy offer much more value at a lower cost for the end customers.
The new market forming within a blue ocean has exponential growth potential, and it is ready to grab to those players able to see it. Those creating this new market will be able to tap into a new demand, which will have them enjoy higher margins and lower competition.
A blue ocean strategy enables the creation of new markets, buy moving beyond the boundaries of existing red ocean markets to create uncontested markets. A key concept of this blue ocean strategy is value innovation.
Bottom-up selling strategies are the norm in the consumer market. Take Facebook, Twitter, or Evernote: Each created a product that can be adopted in minutes. Unlike the top-down selling strategy, where it may take months or years to close a sale (and another year to understand how to use the product), bottom-up selling strategies demand quick adoption and simplicity.
Bottom-up selling is the norm in the consumer market. Take Facebook, Twitter, or Evernote: each created a product that can be adopted in minutes. Unlike the top-down selling strategy, where it might take months or years to close a sale (and another year to understand how to use the product), bottom-up selling strategies demand quick adoption and simplicity.
A must-read book for SaaS founders, especially if you have a self-serve SaaS. Wes has provided a blueprint for creating a complete product-led growth strategy. The book includes both top-level strategic frameworks and tactics like onboarding, product adoption and churn reduction example email sequences.
First, you need a new blue ocean perspective that expands the horizon of your thinking; second, you need humanness along the way to motivate people into helping you make the shift of perspective; and third, you have to have the market-creating tools to transform that perspective into an attractive product.
For instance, consider the UK charity, Comic Relief. The charity industry is a prime example of a red ocean: there are 600 cancer charities in London alone. Nonetheless, Comic Relief instituted a blue ocean shift by fundamentally reconceptualizing the industry.
Third, blue ocean strategists endeavor to produce a new demand and Comic Relief did just that. Rather than pitching wealthy donors, the organization made charity attractive to everybody, no matter how tiny their contributions would be.
And finally, humanness in the blue ocean process requires a fair process. In this case, a fair process abides by three principles: engagement, explanation and clear expectations. The first, engagement, means bringing all the stakeholders into the decision-making process. The second, explanation, requires giving a clear breakdown of decisions and ideas that are rejected. And the third, clear expectations, implies openly stating what people will experience and what their responsibilities will entail.
The second tool to launching a blue ocean approach is called the strategy canvas, a method designed to generate an overview of your current business strategy and the competitive drivers of your industry. To do so, the strategy canvas maps the competitive factors in your industry and how much value buyers derive from each of them.
In this way, the strategy canvas is a powerful tool that highlights the need for a blue ocean shift. It will put your whole team on the same page and reveal potential ways that your organization can break away from industry conventions.
To do so, hold a blue ocean fair and invite the cream of the crop, bringing together a number of leaders from departments across your company. You should at a minimum invite the head of your primary unit as well as her top team, the heads of marketing, manufacturing, HR, finance, IT and logistics. You can even invite customers, partners and suppliers if you like.
At the event itself, begin with an overview of your industry, including all its red oceans, and an explanation of why you need a blue ocean shift. Once that has been made clear, make a presentation on the different blue ocean options you have to choose from.
Companies traditionally work in a red ocean environment, where businesses compete to grab a bigger piece of the pie. The red ocean strategy aims to make your product survive in a market full of competitors. To beat the competition, companies try to differentiate their product from others. It could be through a unique product feature, a niche target audience, excellent customer service or competitive pricing. 2ff7e9595c
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