Are You In Red Or Blue Oceans?
Blue ocean strategy is the pursuit of differentiation and low cost to open up new markets and create new interest. It is developing and capturing blue oceans of uncontested market space, thereby focusing on noncustomers. It is based on the view of industry dynamics and how industries can be reconstructed by the activities and ideas of industry players.
Red oceans are competitive marketplaces. In red oceans, industry boundaries are set and sustained, and the competition is known.
Organisations try to beat their rivals to grab a greater share of existing interest. As the market space gets squeezed, profits and growth are reduced, with products becoming commodities, leading to ‘bloody’ competition.
Blue oceans signify all the industries not in existence today – the undiscovered market space, untainted by competition. In blue oceans, demand is created rather than fought over. There is sufficient opportunity for growth that is both profitable and achievable within a determined horizon.
In blue oceans, competition is immaterial because the rules of the game are yet to be established. A blue ocean describes the deeper potential found in the unexplored market space. A blue ocean is immense, deep, and powerful in terms of profitable growth.