Blue Ocean Strategy For Startups, Part 1

Business Strategy : Blue Ocean Strategy For Startups, Part 1 by Edward Donoghue

Blue Ocean Strategy allows innovative startups to identify uncontested market spaces and render their competition irrelevant.

The principle behind Blue Ocean Strategy is that all markets can be divided into red oceans and blue oceans.

Red oceans are characterized by consensus - a consensus as to who the customer is, who the vendors are, and what the product being sold is.

Consequently, in such a market, selling to the same customers, buying from the same suppliers, making the same thing, there is intense competition and thinner and thinner profit margins.

Seek Uncontested Market Space

Blue Ocean Strategy seeks to escape that. Blue Ocean Strategy seeks to direct ventures towards uncontested market space. Market niches where ventures are positioned so uniquely that competition is rendered irrelevant.

But how? How are these market niches to be recognized?

Value Innovation

To do that requires "Value Innovation." Value innovation is recognizing the values and desires behind the spending choices people make, and then restructuring enterprise resources to provide a superior alternative that is still consistent with those values.

For example, when the theatrical circus, Cirque Du Soleil, began the circus industry was moribund. Rather than just putting together another circus, the founders of Cirque Du Soleil tried to understand the overall value system of people who go out for the evening.

Why do they choose the theater or the movies, as opposed to the circus?

The founders of Cirque Du Soleil found that people viewed the circus as low-brow, juvenile, even crude. The traditional three rings of the circus were a distraction, even annoying.

Also, they were increasingly uncomfortable with the use of animals - more sensitive to the possible abuse behind the entertainment.

Eliminate Elements Which People Do Not Value

So in putting together Cirque Du Soleil, the founders eliminated the three rings, presented the entertainment within a more sophisticated theatrical narrative, and got rid of the animals.

By combining the most valued elements of the theater and the circus, and eliminating the negatives of both, the founders of Cirque Du Soleil were able to create a superior alternative. An alternative which neither circus nor theater can directly contend with.

This article is part of the echoTechJobs job seeker library which offers tips on resume writing, telephone interviewing, outsourcing, difficult bosses, changing careers, employment gaps, etc.

About the Author
Edward Donoghue is the principal of clickTechJobs, a cluster of skill specific job boards for IT people, which includes clickStartUpJobs.

Source: Blue Ocean Strategy articles at goarticles.com