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What Is Blue Ocean Strategy

Autor:   •  September 14, 2014  •  Essay  •  926 Words (4 Pages)  •  1,200 Views

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Blue Ocean Strategy

When looking at the business landscape it is apparent to see that each industry is laden with cutthroat competition as organizations duel back and forth to be the leader in their particular market. This type of strategy represents ‘red ocean strategy’ in which competition fuels the marketplace. There is however another type of strategy which represents growth and “gives rise to entirely new industries.”(Kim & Marborgne, 2004) Although red ocean strategy is the more prominent of the two strategies in the marketplace, blue ocean strategy has been around for years and has recently become a rising imperative for companies looking forward to the future. Let’s take a closer look at what blue ocean strategy is and why it is so important. We will also identify a product considered to be a blue ocean move as well as take a look at a red ocean move for the same product.

What is Blue Ocean Strategy

A relatively new term blue ocean strategy represents companies which achieve success by not battling competitors, but rather by creating ‘blue oceans’ of uncontested market space. “These strategic moves generate a leap of value for a company, employees, as well as others associated with the organization.”(Kim & Marborgne, 2004) Whereas red ocean strategy represents competition, blue ocean strategy aims to sidestep competition by discovering market space that has yet to be explored. With blue ocean strategy demand isn’t fought over but rather created instead as new industries are born full with ample growth opportunities.

Blue ocean strategy is important for businesses and the marketplace because “they are the engine for growth”, (Kim & Marborgne, 2004) and represent creation through innovation. It is important because it allows a business to sell their products with little or no competition from other firms within the same industry. This can be useful for a new business that has very little working capital for advertising and doesn’t want to sell their products in a saturated marketplace in which they are competing against other strong brands. Blue ocean strategy is important because it seeks out new business which wasn’t there before.

Nintendo

The video gaming console is a fierce industry with big name rivals like the Sony Playstation, and Microsoft Xbox battling each other to see who can make the best gaming console. The focus being on who can create a better system with more memory, better graphics, and a faster operating speed. With a strong focus by these two companies on the standard gaming console system Nintendo saw an opportunity to create something different and offer customers a gaming experience unlike the

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