Blue Ocean
What Exactly Is The Blue Ocean?
The term "blue ocean" was used in the entrepreneurship business in 2005 to characterise a new market with low rivalry or hurdles to entry. When a new or unknown sector or invention emerges, it creates a wide "empty ocean" of market possibilities and potential.
In their book Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant, INSEAD business school professors Chan Kim and Renee Mauborgne invented the phrase "blue ocean" (2005). Blue seas, according to the authors, are marketplaces with enormous profit potential.
TAKEAWAYS IMPORTANT
A blue ocean is a market sector that has yet to be explored or competed from a marketing viewpoint.
Blue ocean companies are known for being trailblazers in their fields.
Kim and Mauborgne wrote approximately 150 blue ocean initiatives that firms have implemented over the last 100 years in their book.
What Makes a Blue Ocean Work?
Companies battle for every possible market share in an established industry. Some businesses can't keep up with the competition because it's so fierce. This industry is characterised by a red ocean, which represents a saturated market that has been ravaged by competition.
Blue oceans, on the other hand, provide the polar opposite. Many businesses try to innovate or grow in the hopes of discovering an uncontested blue ocean market. Entrepreneurs are also interested in blue ocean markets.
Blue ocean marketplaces offer a number of qualities that attract innovators and entrepreneurs. There are no competitors in a blue ocean market. First-mover advantages, cost benefits in marketing with no rivalry, the power to establish pricing without competitive restraints, and the flexibility to extend its service in numerous directions are all advantages that a blue ocean market company leader possesses.
IMPORTANT :Business executives that can uncover blue ocean markets and develop novel goods and services have limitless prospects.
Blue Ocean Companies Examples
A blue ocean is unique to a particular epoch and location. Ford and Apple are two instances of blue ocean corporations that built their blue oceans by seeking high product differentiation at a cheap cost, hence raising competitive barriers. They were also emblematic of developing industries at the period, which were later replicated and typified by others.
Ford Motor Company was founded in 1903.
The Model T was introduced by Ford Motor Company in 1908 as a mass-market automobile. It only available in one colour and model, but it was dependable, long-lasting, and inexpensive.
The automotive industry was still in its infancy at the time, with just around 500 manufacturers creating custom-made automobiles that were more costly and less dependable. Ford developed a new manufacturing technology that allows it to mass-produce standardised automobiles at a fraction of the cost of its competitors.
The Model T's market share increased from 9% in 1908 to 61 percent in 1921, eclipsing the horse-drawn carriage as the primary form of transportation.
Apple Inc. is a company based in Cupertino
With its iTunes music download service, Apple Inc. discovered a blue ocean. In 2003, Apple established the first legal format for downloading music, while billions of audio files were being downloaded illegally each month.
It was simple to use and allowed consumers to purchase individual tracks at a fair price. Apple won over millions of pirated music listeners by providing higher-quality sound, as well as search and navigation tools. By introducing a new revenue stream from a new market while giving more accessible access to music, Apple created iTunes a win-win-win situation for music creators, music fans, and Apple.
