Blue Ocean Strategy

Concept:

Blue ocean is an analogy to describe the potential of the unknown market space, untainted by competition. In blue oceans, demand is created rather than fought over. There is growth that is both profitable and rapid. The competition is irrelevant because the rules of the game are waiting to be set. In contrast, Red oceans represent the known market space with a cutthroat competition similar to a bloody ocean (or “red oceans”).

Strategy Canvas:

To develop a Blue Ocean Strategy, the first step is to develop a Strategy Canvas. A Strategy Canvas starts with the identification of the key factors of competition in a market (price and features). Next, each industry player is scored on a scale of high to low for each factor. Once the current market has been mapped, additional features that can add value to buyers are added. Lastly, a path of differentiation is created by adding, enhancing, or reducing features in a product/service offering. A differentiated value curve indicates what a Blue Ocean Strategy would look like. The Strategy Canvas is further tested, refined, and implemented using additional tools and frameworks that are part of the Blue Ocean Strategy.

What can this strategy be used for?

1. Product/Service Differentiation

2. Price Discovery

3. Improved Positioning

4. Long Term Profitability

5. Drive Innovation and Technology Leadership

6. Develop Brand Equity Blue Ocean

Strategy is not only a great strategy tool for businesses looking to grow but also for Private Capital investors aiming at Value Creation in portfolio investments.