Blue Ocean Strategy: Guide to Enter Competitive Markets

 Introduction

Ever wondered how Aman Gupta’s Boat was able to crack the code of electronics industry?

To carve out a space for themselves in a highly competitive market is not only a tedious task but also a lesson for other brands who are willing to enter cluttered market spaces and aspire to make it big. To know how it can be implemented understanding of the following two concepts is essential- Red Ocean and Blue Ocean Strategy.

Red Ocean Strategy

 Red itself symbolizes cut-throat competition. Here, existing industry practices are pursued to defeat the competition. In the red oceans, industry boundaries are well-defined and accepted, and the competitive rules of the game are known to all. Red ocean strategy is when companies try to outperform their rivals to grab a greater share of existing demand implying profit for one is loss for the other. As the market space gets crowded, prospects for profits and growth are reduced. Products become commodities which means the differentiation remains almost nil, and cutthroat competition turns the red ocean bloody, hence the name.

Blue Ocean Strategy

When we talk about blue oceans, we refer to the unattended areas in the given industry by the competitors and capitalize on it to position the brand as distinctive and customer oriented. Blue ocean strategy is the simultaneous pursuit of differentiation and lower costs to create new market space and generate new demand which Boat was able to pull off effectively. It is about creating and capturing uncontested market space thereby reducing the competition to dust. It is based on the view that market boundaries and industry set parameters are not a given and can be reconstructed by the new entrants to leverage their brands.

Take the example of PaperBoat. The beverage industry was dominated by Coca Cola and Pepsi and to compete against these giants would imply that stakes are certainly going to be quite high!

What worked for the founders is that they saw nobody in the market was catering to the traditional beverages consumed by Indians in different parts of the world like Kanji, Aamras, AamPanna and many more. This area was being ignored by all the players and that’s how they were able to create a BLUE OCEAN for themselves! And oh, not to forget the nostalgic tint to the communication strategy that they added which was enough to melt the hearts of the children, their parents and grandparents alike.

References

1. https://bit.ly/3Iey9Zk
2. https://bit.ly/3HQybFn
3. https://bit.ly/3RT6nVh
4. https://bit.ly/3YmDT8R