Blue Ocean Marketing Strategy

MARKETING – To me marketing is something I grew up with. A library of books on marketing and a parent to inspire me, I have always been interested in this subject and what it can offer me as a profession.

HOW COMPANIES HAVE APPLIED BOS IN DIFFERENT INDUSTRIES – SUCCESS STORIES

The difference between being a failure and a winner in the corporate marketplace could be a blue ocean strategy. What is a blue ocean strategy? Rather than beating the competition, a blue ocean strategy works by making the competition irrelevant, according to Renee Mauborgne, co-author of the best-selling book, Blue Ocean Strategy.

Ms Mauborgne, who was in India recently for The Premier Business Leadership Series organised by business intelligence and analytics firm,

Wii's launch helped Nintendo grow sales 90%.With the Wii, what Nintendo did was ask itself how many customers used high-definition TV compatibility, a feature that was pushing up the cost of the console. The answer was hardly any. So it decided to do away with this feature, keep the price of the Wii low and also target non-core gamers with the product. Thus using a blue ocean strategy, it created a new market for itself instead of fighting for share in the market space dominated by Sony's PlayStation and Microsoft's Xbox.

Blue Ocean focuses on how to link innovation to commercial value. While traditional strategy, or red ocean strategy, exploits existing demand, blue ocean strategy creates and captures new demand in the same manner that Nintendo did with the launch of the Wii. What Nintendo did was create an uncontested market space and make the competition irrelevant. Also in a red ocean, competing companies usually have to choose between differentiating themselves at the expense of pushing up costs, or stay low-cost and undifferentiated from

Most BOS success stories in the past have been through trial and error. BOS is not a new concept but one which has always been in existence and worked on over the years. BOS as a process is not intuitive which is why a formal framework was required for repeated use of the strategy. Prof Kim and Mauborgne, for the first time, formally introduced “value innovation” as a concept in 1997. They did not invent the concept, they discovered it. Just like Newton discovered the Law of gravity. Law of gravity was always in existence and it was only with the observation of a falling apple did Newton discover it for us. Similarly, a systematic way of thinking blue was discovered by giving a fresh approach to strategy. People have always learned, applied, talked, and discussed about competitive strategy (Red Ocean). Red Ocean is a part of our business and thought processes and is therefore the only concept we look at while formulating strategies. Blue Ocean does not require a complete change in one’s perspective towards business. Just a one degree shift in our perspectives will present a whole new gamut of opportunities. In other words, it is a way of adapting our existing thought processes and that is precisely why BOS is called “systematic creativity”. The concept of Blue Ocean is not new, but the theoretical framework is!

Blue Ocean Strategy coexists alongside Red Ocean Strategy (Competitive Strategy). Every blue ocean move