A “blue ocean” is a new market with few competitors and few things that could get in the way of new ideas. In 2005, businesspeople came up with this idea. This article talks about the six principles and 4 methods of the blue ocean strategy. It also talks about the importance and characteristics of the “blue ocean” strategy.
How to Make a Blue Ocean
Companies in a well-known field compete for a smaller share of the market. Sometimes, there is so much competition that some businesses just can’t stay in business. A “red ocean,” which is a metaphor for a market that is very competitive and full, is used to describe this sector.
On the other hand, blue oceans offer a chance. Many companies try out new products or expand into new markets in the hopes of finding a “blue ocean” where they can be the best in their field. A lot of new businesses look for opportunities in markets that are “blue oceans.”
The blue oceanic markets are appealing to creative people and business owners for a variety of reasons.
“Blue ocean” markets are ones that no one else can get into. A business that owns a “blue oceanic” has a lot of advantages over its competitors. It can get a head start on the market, spend less on marketing, set its own prices, and add new products to its line.
Blue Ocean Strategy
The blue strategy is to go for both uniqueness and low prices at the same time to carve out new market space and boost demand. To do this, you need to carve out and take over a part of the market where none of your competitors are. It is based on the idea that the boundaries of markets and the structure of industries are not set in stone. Instead, they can change based on what people think and do in those markets.
The term “blue ocean” refers to the main idea of the book Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant. The other authors of the book, W. Chan Kim and Renee Mauborgne, wrote it together. When a brand-new industry or groundbreaking product hits the market, it opens up an “empty ocean” of possibilities and choices.
Instructions on How to Make a Blue Ocean
The following is how to use a “blue” plan to your advantage.
- Set a launch date for your new products and hire people who can help you build a strong company culture and a brand that people will recognize.
- Look at what your team does well and what it could do better, and think of ways to improve it.
- Try to put yourself in your customers’ shoes and figure out what problems they might be having.
- Fill this need with products and services that your competitors can’t.
- Make a detailed plan for the change and try out your new services and the methods you’ll use to implement them.
Advantages of the Blue Ocean Strategy
The following are some of the good things about the blue strategy.
#1. You Don’t Go Into Markets That Are Already Full
If you want your small business to do well, you’ll have to beat out big companies and other market leaders. With the blue approach, on the other hand, you could make a product that is both unique and priced competitively. This would give your business a market. The big players in your field won’t bother to compete with you.
#2. The Possibility of Growth Is Brought Up
When you use the strategy, you try to give your customers new value while still giving them what they want, which is a unique product or service. Just the fact that more people are buying a product or service can increase interest in it through word of mouth.
#3. Customers Will Feel Like You Understand What They Want
Value and cost are both important to the blue strategy. There will always be new products and services at fair prices. If you take this approach, it makes it easier for your target market to buy from you.
Cons With the Blue Ocean Strategy
The following some things that don’t work well with the blue method are:
#1. It Could Involve Attempting to Accomplish Too Many Things at Once
Supporters of the blue strategy say that any company can make a market for a new, low-cost product or service that has few or no competitors. It’s not always a walk in the park to be very creative. Even if you have a great idea, you might not be able to carry it out for practical reasons.
#2. This Might Be Too Risky to Try
You might have come up with a completely new product and figured out how to sell it without making a fortune. Maybe you’re at this fork in the road because other small businesses are interested in what you’re selling.
#3. Maybe It’s Just for Now
Since innovators often make others want to do the same thing, a once-promising “blue ocean” could turn into a “red ocean” that is full of competitors. Your company may think that a blue strategy is perfect for them right now, but that may not be the case in the future.
What Are the 4 Strategies of Blue Ocean Strategy?
Now is the time for businesses to start working on their “blue” plans. So, they can make a business plan that will last and make sure that their blue ocean-creating business will make money. Here is a list of the things;
- Buyer value.
- Price.
- Cost.
- Adoption.
Characteristics of Blue Ocean Strategy
The blue ocean strategy has the following characteristics:
- One of the characteristics of the blue ocean strategy is to set up a monopoly in a market that already exists.
- Get rid of the other people. This is one of the major importance or characteristics of the blue ocean strategy.
- Getting and keeping the attention of new customers.
- Don’t sacrifice quality to save money. This is also one of the characteristics of the blue ocean strategy.
- To stand out and keep costs low, a company’s whole system must work well together.
Importance of Blue Ocean Strategy
The following are the importance of a blue ocean strategy.
#1. It’s Based on Facts From the Real World
The Blue is the result of a 10-year study of more than 150 strategic actions from 30 industries and 100 years.
#2. It Makes the Most of What Could Be and Lessens What Could Go Wrong
The importance of the blue ocean strategy is that it teaches you how to figure out how marketable your ideas are and how to make them better so you can get the most out of them with the least amount of trouble.
#3. It Creates an Entirely New Market Segment That Isn’t Likely to Have Any Competitors
The goal of a “blue” strategy isn’t to be the best in your field. It wants to get rid of competitors by redrawing the boundaries of markets that already exist.
#4. It gives you ways to be in charge, like models and guides
The blue strategy gives you the tools and frameworks you need to move from the competitive red ocean to the uncontested blue ocean.
#5. This Plan Is Meant to Stand Out and Save Money at the Same Time
The importance of the blue ocean strategy is based on the idea that you should try to be unique while also saving money.
#6. It Shows How to Come to an Agreement That Works for Everyone
In a successful business, value, profit, and people are all tied together, and the blue strategy shows how to bring them all into harmony.
What Are the Six Principles of Blue Ocean Strategy?
The six principles of the blue ocean strategy are based on the following below:
#1. Shift Market Borders
Using one of these blue ocean strategy principles as a guide, business leaders can reduce their exposure to search risk by carefully carving out uncontested niches in a wide range of market sectors.
#2. Look at the Big Picture, Not the Little Parts.
Clearly shows how to set up a company’s strategic planning process to come up with good ideas that go beyond just improving what’s already there. The current strategic planning process is often criticized for being a number-crunching exercise that keeps organizations stuck in making small improvements.
#3. Try to Meet More Than What Is Needed Right Now
If managers want to create the newest demand, they need to rethink the common practice of looking for more detailed segmentation to better meet the needs of their current customers.
#4. Make Sure You Plan Your Strategic Moves Well
By following one of these blue ocean strategy principles, businesses can be sure that they will not only help their target market in a big way but also give themselves a solid base for future growth. It reduces business model risk by helping companies make money from the blue plan they’ve created in a way that’s sustainable.
#5. Overcome Major Problems Within the Company
The principles of tipping point leadership show managers how to get their teams to work together to get past the big problems that are stopping a blue ocean strategy rollout from going well.
#6. Make the Process of Doing the Approach Work Together
If employees are involved in making a blue strategy from the beginning, they are more likely to act on it and use it in a sustainable way.
What Is an Example of the Blue Ocean?
Cirque du Soleil, a Canadian entertainment company, is often used as the most well-known example of the “blue ocean” idea.
What Are the Three Pillars of a Successful Blue Ocean Strategy?
Chan Kim and Renée Mauborgne say that for a company to move from red oceans to blue oceans, it needs three important things: a blue ocean perspective, market creation tools and methods, and a humanistic approach.
What Are the 5 Ps of Strategy?
There are as follow below;
- Plan.
- Ploy.
- Pattern.
- Position.
- Perspective.
What Is an Example of a Blue Ocean Strategy Company?
The “blue” idea can be seen in action in the success of Amazon. Jeff Bezos, who started the company, wanted Amazon to be the biggest online bookstore, and that is what it is now. The success of the company was helped by how easy and well-thought-out the online experience was.
What Is One of the Basic Aims of a “Blue Ocean” Strategy?
The goal of the blue ocean strategy is for businesses to find “blue oceans” (open, growing markets) and take advantage of them while staying away from “red oceans” (overdeveloped, saturated markets). In a “blue” market, a business will have more chances to make money, less risk, and a higher return on its investment.
Who Started the “Blue Ocean” Strategy?
Chan Kim and Renee Mauborgne used the term “blue ocean strategy” for the first time in their book of the same name. Most blue ocean companies are the first ones to start in their fields. Compare this to “red oceans,” where there is a lot of competition and the market is full.
Conclusion
A “blue ocean” is an untapped market or a business that doesn’t have any competitors. Many blue companies that do well are market leaders. “Red oceans,” on the other hand, have a lot of competition and a lot of buyers.
BLUE OCEAN FAQs
What exactly are the blue and red oceans?
Instead of trying to take market share from the leaders who are already there, a “blue” approach tries to make new markets from scratch. A “red ocean” is a well-known market with many competitors, while a “blue ocean” is a new market with few or no competitors.
What's so important about blue ocean?
The blue strategy works by attracting many customers and making it more expensive for competitors. Blue vs. Red Ocean Strategies Red ocean strategies are crucial to success, but they are not adequate.
Is Apple a blue or red ocean company?
One of the largest corporate turnarounds in history got its start with this slogan, which is still effective today. The blue perspective is summed up in Apple’s “think different” tagline, as you can see.
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