Blue Ocean Strategy: Get Out the “Crowd” Desember 20, 2009Posted by aditkus in Daily Life.
Blue Ocean is one of the strategies in contemporary marketing, which emphasizes in differentiation or value added on product or service. The inventors of Blue Ocean strategy, Professor Kim and his colleague Professor Mourbogne spent 15 years for their research which is written in a book with the same title “The Blue Ocean Strategy”. The philosophy of this strategy is “Making a market without competitors and competition is not relevant any more”. To illustrate their point of view, they divide business strategies into 2 kinds: Red Ocean and Blue Ocean. A company that competes in Red Ocean (crowded market) has many competitors and the competition becomes a bloody condition-which it took the term of Red Ocean. The smart way to avoid this condition is jumping into blue ocean-make your own market space without competitors and make competition not relevant anymore and at the end it will benefit company. Blue Ocean is a way to win the competition elegantly. That is why we should be creative to be able to generate new market which carry and give value added to customer. It can be said that blue Ocean strategy is a way of thinking that shove us to be creative, create value added and be able to make new things.
May be there are some questions, such as what are the differences between the common marketing theory that also recommend “diffentiation” with blue ocean strategy? Blue Ocean strategy gives certain kind of frame work and analysis tools to formulate and assist the implementation of this strategy such as: how to reconstruct market boundary, focus on macro point of view, exceed the demand or claim, make technical strategy, solve organizational obstacles, and integrate execution on strategy. In my opinion, to apply this strategy we need to emphasize in differentiation or value added by positioning, making value innovation, increasing consumer or market sensitiveness behavior, and making your own market and rules.
At the first point we should able to identify ourselves. We should know where we stand up, a company should know and understand its position and which industry its involve in. After that, creativity and imagination start to work. Here there are only two alternatives that we can offer to customer , which depend on their needs. We should know ourselves from other people who are not our customer or forgotten as our customer whereas they are our potential market. These kinds of people are source of potential insight for turning up into Blue Ocean because they can observe us more objectively.
If we observe the latest business competition, companies which are able to lead the market are the company that always has value innovation. These companies do not just rely on “me too” (copy paste) product or service from other companies but they have value added and difference in the same manufacturing industry. Giving value innovation through many ways such as: adding new features or benefit on present product or service, biding on lower price for the same benefit with the product that already in market, giving superior comfortable service, or giving good experience value. For example Nokia, this company frequently launch their new product with various variant plus innovative new feature and their product are also user friendly (value added). Another example is Microsoft; this company is very famous for their products namely Intel Pentium processor and Windows. This company sells their innovation to people and until now there are no significant competitors that can replace Microsoft as a market leader.
We can also give value innovation to customer by developing present product or service. For example in past time we only depend on floopydisk as storage device but after that cd become a new idol and become market standard on storage file. Right now cd starts to be abandoned by market because there are new device called flask disk which is more functional and portable. Another way to become different and then swimming alone with victory in Blue Ocean is by applying pricing-strategy. By making production process efficient, automatically you can bid supply lower than competitors.
“Costumer is king” is one of the terminology in modern marketing, which has big role as vital part toward existence of business in a company. A company should focus in value innovation by searching new values that can be beneficial to customer and make them re-buy. Right now it is not relevant any more to use “push product” strategy in a company which means forcing their product to market. All companies have shifted into “pull product”. In “pull product” strategy a company produces product or service depend on market need. To apply this strategy a company will need sensitiveness behavior to catch the opportunity, which will also drive a company to create Customer Relationship Management (CRM) that can help to manage their consumer and customer. Beside CRM, there are many theories which focus to help company to run their business emerge such as Intelligence marketing and Knowledge marketing.
One thing that should have more attention is that companies usually do not know and do not realize their position whether it is in Red Ocean or in Blue Ocean. Most of the companies do not know where they are. Actually, they are convincing themselves to be in Blue Ocean position since the company was established. Because of these three ways above have tight relationship with the latest one, after we can do both of them right now is time to create your own market and rules.
If the three ways mentioned previously have already been implemented, then your product or service automatically will have market space that no one came as your competitors. Right now you can focus on the emergence of demand and movement to stay away from competition and strengthen the ability to maximize the opportunity and minimize the risk which is proposed in blue ocean strategy. Now Imagine that you already have your own market, it is easy to make regulation that is beneficial to you without inflicting a financial loss to your consumer and you can preserve consumer loyalty.
To be able to survive in competition, companies nowadays should be creative to generate new market by carrying and giving value added to customer. The Blue Ocean strategy gives certain kind frame work and analysis tools to formulate and assist the implementation of this strategy. In conclusion, blue ocean strategy is how you can think out of the box that can compose your product or service different. Then you make a market without competitors and competition is not relevant any more. By making innovation, increasing consumer or market sensitiveness behavior as impact you will have your own market and consumer and create your own rules.