Blue Ocean Strategy: The highly competitive corporate environment imposes challenges that are increasingly difficult to overcome at a time when it is no longer enough to offer a higher quality or faster service — it is necessary to be innovative.
Within this vision, the book Blue Ocean Strategy, or Blue Ocean Strategy, presents a new paradigm that has revolutionized the way of doing business. What is the blue ocean strategy, how does it work, and how will diving into this sea help your company to stand out in the market? Check out!
What Is The Blue Ocean Theory?
The blue ocean theory was put forward by researchers W. Chan Kim and Renée Malborne in the book Blue Ocean Strategy. It is based on the observation that many companies insist on remaining in the same market or business model, which is already saturated and highly competitive. This bloody and red struggle to attract new consumers has resulted in insignificant results.
On the other hand, many companies have reinvented and restructured themselves to develop new business models. Within the concept of blue ocean strategy, many entrepreneurs sail into unknown seas, that is, new markets not served before. They thus flee an area of broad competition where earnings growth would be improbable.
How Does It Work?
Innovation, in this context, is not necessarily linked to creating a new market. Still, it is about “value innovation,” or Value Innovation, aiming to meet the specific needs of consumers within a new segment. Large corporations often need to identify these needs, allowing you to offer a service/product of unique value.
To understand this value, remember that every entrepreneur is also, in essence, a consumer, and, as consumers, we like to be presented with services that meet our requirements and needs. When we find a unique service, which has been tailor-made, we attribute real value to it, which does not exist in the services offered by other companies.
How To Put It Into Practice?
To put the blue ocean strategy into practice, it is necessary to seek a niche or market segment that has yet to be explored. This can mean stepping out of your comfort zone and researching new consumers and potential features.
Therefore, it is necessary to evaluate some aspects, such as the number of consumers, their needs and desires, types of products and their characteristics, the geographical area and logistics of service, and the competitive advantage amid competition.
This information can be obtained and built from collaborative communities, known as crowdsourcing. Through these platforms, companies can test their products and services, using collective knowledge to gather information and opinions from people worldwide. Some of these platforms support Innovation Programs, developing ideas, and finding solutions for corporate projects.
What Benefits Can The Blue Ocean Strategy Bring To Your Company?
Within this competitive landscape between companies, defining blue ocean strategies can bring countless benefits to your company. These advantages are interconnected so that one use results from or is a consequence of another. Let’s consider the main ones.
Fill A Market Gap
There are still many uncharted seas, untapped markets, and segments — and there always will be. This is because the needs and desires of consumers change, and new ones are created over time. When the company is aware of these factors, it manages to fill this gap and innovate its products, services, or business model.
Strengthen The Brand And Makes It A Reference
When the company offers a differentiated product/service that meets users’ needs, it builds customer loyalty. Precisely because it is something new in the market, the organization manages to become a reference in what it offers and has its brand established, recognized, and strengthened.
It Makes The Competition Irrelevant
While in the red ocean, companies are concerned with competition because they need to compete in a market that already exists, in the blue ocean strategy, the focus is on irrelevant competition when the consumer perceives that only your product meets his needs in the way he needs. . In this view, your company overlaps with the competition in the sense that only you offer the service/product they want.
Increase Profits With Low Cost
This is one of the divergent points between the red ocean and the blue ocean. In the traditional model, companies work with the relationship between cost and value, while the blue ocean strategy aims to create more weight at the lowest price. This is because, in the blue ocean, the consumer is willing and comfortable to pay for the product due to the high value attributed and its usefulness.
Keeps The Company With The “Feet On The Ground”
Since the beginning of the construction of the new business model, the strategy has been based on detailed research, continuously remodeling the project according to the needs and demands of consumers. This process provides the company with critical feedback, which contributes — and a lot — to reducing potential risks.
Undoubtedly, the blue ocean strategy is a fundamental instrument for the longevity of companies, allowing them to leave a competitive environment, emerge in a new segment, and attract new customers with services/products of real value.