What is Blue Ocean Strategy and Why it Matters for Your Business

What is a Blue Ocean Strategy?

A blue ocean strategy is a business strategy that makes the competition irrelevant. Conversely, red oceans are the markets where business compete for market share. Blue oceans are where a business is unique and has created a new market where it has no competitors.

5 Steps to Implementing the Blue Ocean Strategy for Your Own Business

1. Delete the word “me-too” and replace it with “new and different”

It is important to differentiate your company from the crowd. You should not just go for what everyone else is doing because it will make you look like you are just trying to copy them. Your product or service should be unique and offer a new perspective on current industry trends.

2. Create a strategy canvas

Consider the important dimensions of your product or service from your customers point of view. Then rate your company and your main competitors on each dimension. This creates a value curve for each player. For example:

Image source: https://www.blueoceanstrategy.com/tools/strategy-canvas/

3Think about how you can change your value curve.

Blue Ocean Strategy proposes that you use the Four Actions Framework to analyse how you might differentiate your product or service. The Four Actions are:

1. Raise — can any of your factors be raised well above the industry standard?

2. Eliminate — which features have been standard for your industry for so long that they are no longer a useful point of difference?

3. Reduce — which factors can be reduced well below the industry standard. These might be features which are common to the industry but are not considered important by the customer.

4. Create — which features can you introduce that have never been offered before. This is where your blue ocean market exists.

4. Decide which of the actions to implement

Blue Ocean Strategy introduces the Six Paths Framework to help with this. A blue ocean strategy will generate ideas to make the competition irrelevant by:

1. Looking across alternative industries

2. Looking across strategic groups within industry

3. Redefining the industry buyer group

4. Looking at complementary product and service offerings

5. Rethinking the functional-emotional orientation of its industry

6. Shaping external trends over time

5. Launch!

I can’t tell you much about launching at present, as I need to read the follow up book Blue Ocean Shift: Beyond Competing — Proven Steps to Inspire Confidence and Seize New Growth.

I can promise I’ll be reading this soon. I found Blue Ocean Strategy to be incredibly insightful and actionable. I’m looking forward to finding out how the authors have expanded on their ideas and will be reporting back before too long.

Originally published at www.happenconsulting.com.au