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Blue Ocean Strategy ... Examples
5/14/2006 at 1:29 PM ET
Blue Ocean Strategy
is a book by harvard university press that states that instead of fighting for space in the already crowded sectors/ buisnesses, one must invent new domains/ categories, so that profits are maintained with minimum overheads.
I am doing some research on BOS.. It would be great if you experts here can give me examples of different companies who have used this strategy effectively?
5/14/2006 at 2:01 PM
Let me give you some examples.
A) PARAS PHARMA has grown over the years by creating a new category of products altogether.
5. Itch Guard
6. Dermi Cool etc
And all these products are doing so well and its share in the FMCG sector is substantial.
Frankly speaking, Paras is one of my favorites in FMCG sphere in India. They have created a space for themselves.
B) CavinKare used this in 1984 for the first time when he launched Sachets in India. The first launch was Chik Sachets for as low as 50 paisa. And they got a big market by targeting the bottom of Pyramid.
C) There was an article in Economic Times - "
LG Mobiles to dive into 'Blue Ocean', plan to take on rivals
I will post more examples if i get more.
5/14/2006 at 2:39 PM
D) Ford introduced the assembly line, which replaced skilled craftsmen with ordinary unskilled laborers, who worked one small task faster and more efficiently, cutting the time to make a Model T from twenty-one days to four days and cutting labor hours by 60 percent
E) Deccan Airlines: They introduced - Everyday Low Prices concept in Indian Airlines. The ticket were as low as $10. So they entered a space with no competition in airlines at that point of time. Now its like a red ocean.
So companies have to keep innovating to come up with undisputed new areas.
F) Kingfisher Airlines: They have used the whole experience as their USP. They have created a blue ocean within a red one. Kingfisher redefined the travel experience for business and first-class travelers. This is also what Virgin used. According to Virgin, it’s not just getting from one airport to another, but the experience you have from when you leave your home to when you arrive. So it includes ground transportation, and options like taking a shower on arrival instead of going to a hotel.
G) Skin Care in India: When FMCG companies in India saw that the personal - skin care market is getting saturated and there are many players competing, they entered in service industry. Marico started Kaya Skin Clinic. Here the margins are more and players are less. But in future we will slowly more FMCG players entering into this space to make it Red Ocean.
So these days, one need to think strategically and have innovative acumen. This will help all the players to grow without much of competition - just look out for unfulfilled needs or create new needs.
5/15/2006 at 11:07 AM
IKEA would be an example in America. Before IKEA the retailers of furniture were either priced high with lots of customer service. These retailers were Thomasville, Rooms To Go, Haverty's, etc..... The other furniture retailers were Wal-Mart, K-Mart, Office Depot.
IKEA offered reasonably priced furniture with a good selection and labove average quality accompanied with little customer service. If you draw a retail diagram of price and selection and give four segments, you will see that the High Price and High Selection segment was full as well as the low price and little selection segment. IKEA became the lone retailer of low priced high selection furniture.
5/16/2006 at 6:09 AM
1) Nirma: With their launch of cheap washing powder, they captured a market that HLL ignored and even sneered at. They grew large enough to actually steal market share from HLL's Surf.
2) Himalaya Drugs: They created an entirely new market of consumers who prefer medically proven herbal medicine. Following their lead, all FMCG majors came out with their own little herbal range!
3) Aravind Eye Hospital: Perfected the art of eye care to such a level that their doctors perform phenomenally high number of operations keeping their costs/patient low! Catered to people that just could never afford private hospitals.
5/17/2006 at 7:57 AM
Thanks for asking this question. As you know the Blue Ocean Strategy (BOS) is “all about capturing uncontested market space thereby making compeition irrelevant”.
As you received such wonderful answers till date and lying to solve the mistry. I would like to share my views about Blue Ocean Strategy.
“Acquir New Market by using New strategy”
There are so many companies around the world are using this strategy to place there position in new market. I have few examples and they are the part of Blue Ocean strategy.
1. Cirque du Soleil : An entertainment company founded in 1984 by Guy Laliberté and Daniel Gauthier. It has been described as the modern circus, and focuses upon a storyline as well as amazing performances.
1.1 After doing the resrach in the Entertainment industry Cirque du Soleil came with new concepts. Cirque du Soleil start using the human as performers and does not make use of animals.
They start using new concept of combine elements of street performances, circus, opera, ballet, and rock music. Cirque shows do not use pre-recorded music; all music is played live.
1.2 Cirque introduced the use of bungie cords to aerial acts and created a modified tumbling trampoline called a Power Track, both of which have since been adopted by other circuses.
2. Gmail: Gmail is a free webmail and POP e-mail service provided by Google. It is having competition from hotmail.com, yahoo.com,outlook express, apple mail and AIM Mail service provider.
2.1 Realesed on 1st April 2004 and become famous from every corner of world. After 2 years of succes still using his Beta Policy for sign up. The purpose of the invitation system is to reduce the amount of abuse.
2.2 It is also possible to sign up if one have a mobile phone from Australia, Indonesia, Malaysia, Singapore, Thailand, Turkey, New Zealand, Philippines or the United States via SMS Signup.
2.3 Google Calender, Auto save enhancement, Option Dots, Keyboard short cut and several other future makes gmail one of the faviourate accessing account for day to day life.
3. Wii 7th generation video game console, announced on April 27, 2006: The system is unique in that the console's controller, can detect its position and orientation in three-dimensional space.
3.1 Backward Competability, virtual consol, wiiconeect 24, Parental control makes them more attractive in business.
3.2 Nintendo has stated that the Wii will be cheaper than the PS3 and Xbox 360, with the basic Xbox 360 at $299 USD and the basic PS3 at $499.
3.3 Wii have a stand-by mode entitled WiiConnect24, in which it is connected to the Internet and can receive messages and updates while not consuming much power.
3.4 There advantages Over Xbox and PS3 brough Big market success.
4. EasyJet is a low cost airline officially known as easyJet Airline Company Limited, based at London Luton Airport.
4.1 EasyJet and its Republic of Ireland-based rival Ryanair are by far the largest low cost airlines in Europe, and the rivalry between them.
4.2 The two companies have slightly different strategies. easyJet flies mainly to leading airports while Ryanair uses far more secondary airports to reduce costs.
As you know the markets that are very competitive and you have to cut your prices a lot are called red oceans and the new markets or poorly competitive unestructured markets are called blue oceans. Above examples are giving the idea of New Market with New Product Strategy.
But if you use Ansoffs Matrix to any business it will be far more better to judge the market for long term relationship. By choosing blue oceans above companies had made their product and service to stand over the other products because they have no competition in your league or call less competition.
I hope this will help!
5/18/2006 at 8:42 AM
Great inputs from all the experts !!
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