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The Blue Ocean Strategy
The Business Universe Consists of Two Kinds of Markets Red Oceans Blue Oceans
Blue Ocean Strategy Red Ocean Strategy Compete In Existing Markets Create Uncontested Market Space • • Beat the Competition Make the Competition Irrelevant • • Exploit Existing Demand • Create and Capture New Demand •
Blue Oceans Are Not A New Phenomenon Which of Today’s Industries Were Unknown A Hundred Years Ago?
Automobiles Pharmaceuticals Management Consulting Music Recording Aviation Petrochemicals
Which of Today’s Industries Were Unknown Forty Years Ago? Discount Retailing Mutual Funds Express Package Delivery Cellular Phones Coffee Bars Biotechnology
The Paradox: Red Oceans Still Prevail Despite the indisputable success of blue oceans, however, most companies continue to compete in red oceans.
Red Ocean Initiatives Don’t Pay By focusing on incremental innovations, companies are failing to act in their best interests.
Why Do Companies Still Focus on Red Oceans? Because That’s How They’ve Operated for Years and Years.
Traditional Strategy Blue Ocean Strategy
A Shift in Mindset It’s not always about technology innovation. Incumbents aren’t necessarily at a disadvantage.
Blue oceans create high barriers to imitation. Such as: • Economic Barriers • Organizational Barriers • Cognitive Barriers
Chart a strategic course past traditional industry boundaries in search of the unknown markets of the future.
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