Blue Ocean & Red Ocean Strategies in business PDF

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Description of lecture notes blue and red ocean startegies in business....

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Blue Ocean & Red Ocean Strategy Red Ocean Strategy: • • • •

Red oceans are all the industries in existence today – the known market space. Cut-throat competition in existing industries turns the ocean bloody red. Hence the term ‘red ocean’. Red ocean strategy is all about competition. As the market space gets more crowded, companies compete fiercely for a greater share of limited demand. Competing in red oceans is a zero-sum game. A market-competing strategy divides existing wealth between rival companies. As competition increases, prospects for profit and growth decline.

Blue Ocean Strategy: • • • •

Blue oceans are all the industries not in existence today – the unknown market space. Unexplored and untainted by competition, ‘blue oceans’ are vast, deep and powerful in terms of opportunity and growth. Blue ocean strategy creates new demand. Companies develop uncontested market space rather than fight over a shrinking profit pool. Creating blue oceans is non-zero-sum. There is ample opportunity for growth that is both profitable and rapid.

Source: https://www.blueoceanstrategy.com/what-is-blue-ocean-strategy/ What Strategy to follow in a Red Ocean? • • • •

Good Suppliers: Suppliers that are Competitive and Reliable. Fight every New Player: Buy or Beat your New Competitors. Diversified Product Mix: So the Market can be Tackled in different ways. Taking Care of Clients: They have many Alternatives in the Market.

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Competition: Study the Competitors carefully, and Beat them.

Example of Red Ocean Strategies: 1. Mobile screen market: Samsung leading the way with Super AMOLED displays. 2. Rise of iphone: Apple became an overnight leader in smartphones with introduction of the iphone.

What Strategy to follow in a Blue Ocean? • • • • •

Flexible Suppliers: Suppliers that can Adapt to Changes. Study the New Players: Be aware of their Products and Market Approaches. Focus on your Product: Substitute Products are not yet a Threat. Comfortable Relationship with Clients: For you. Don’t push yourself too hard. Competition: Grow Faster than them to become the Market Leader.

Examples of Blue Ocean strategy: 1. Windows – Microsoft came out of the way by introducing an “operating system” in a computer. 2. Tesla – Created a new market for electric vehicles....