1.
BLUE OCEAN STRATEGY OF APPLE
FROM iPod to iPad
Presented By
Manu
Balaji
Kowshik
Mayur

2.
BLUE OCEAN STRATEGY
This new thinking makes it possible for innovative
entrepreneurs to increase their chances for success and
the extent of potential success. It includes:
• Insights about the innovative positioning of new
ventures; and
• Tools to make it possible.
To help you:
• Modify your business model,
• Re-orient your product or service,
• Change the borders of your target market, and
• More effectively carry out your venture.

3.
CUSTOMER ORIENTATION
• A distinctive aspect of Blue Ocean Strategy is
that:
• instead of looking to serve existing prime
customers in the existing market place,
- it is largely concerned with modifying a
product or service offering, and
- establishing new market space by targeting
dissatisfied customers and non-customers,
the potential customers for the new venture.

4.
THE POTENTIAL IMPACT OF BLUE OCEAN
What interests us most about Blue Ocean is that it
gives you a path to find and implement a winning
formula for your business model:
• with improved understanding of the way that
markets work; along with
• methods of analysis, and tools for
strategy implementation

5.
• Its principal objective is to make it possible to reconfigure and
implement a new business model in order:
• to leave a highly-contested market (a “Red Ocean” with blood in the
water); and
• create new market space without effective competition (a “Blue
Ocean”).
• The Blue Ocean approach makes use of a process called “value
innovation” in which you:
• look at the elements of a product or service offering on which ventures
in the industry compete, and
• determine elements that can be:
– Eliminated,
– Reduced,
– Improved, and
– Added
THE KEY TO BLUE OCEAN STRATEGY

6.
RESEARCHING THE HISTORY OF
“BLUE OCEAN CREATION”
• Data: 150 blue ocean creations, more than 30 industries,
over 100 years (1880-2000)
• Hotel, cinema, retail, airline, energy, computer,
broadcasting, home construction, automobile, steel
manufacturing, chemicals, cosmetics, software, etc.
• Variables considered: industrial, organizational, strategic
Reference From : www.hbs.org

7.
Business Launch
Revenue Impact
Profit Impact
Red Oceans
Market-Competing Business Launches
Blue Oceans
Market-Creating Business Launches
Companies Have Achieved Substantially
Higher Returns from Investments in Blue Oceans
7

8.
Red Ocean Versus Blue Ocean Strategy
Create uncontested market space
Blue Ocean StrategyRed Ocean Strategy
Compete in existing market space
Beat the competition
Exploit existing demand
Make the value-cost trade-off
Make the competition irrelevant
Create and capture new demand
Break the value-cost trade-off
Align the whole system of a firm’s
activities with its strategic choice of
differentiation or low cost
Align the whole system of a firm’s
activities with its strategic choice of
differentiation and low cost

9.
Blue
Ocean
Strategy
Value Innovation:
The simultaneous pursuit of differentiation and low cost
Eliminate
Reduce
Raise
Create
Cost
Buyer Value
Value
Cost

10.
Four Actions Framework for Apple
EliminateEliminate RaiseRaise
ReduceReduce CreateCreate
Difficulty in text messaging-use
keyboard instead
•Carrying separate devices: phone,
MP3, PDA
•Requirement to always hook up to PC
•Difficult user interface-make touch
screen
• Device to download music directly
• Hold more songs
• Simple user interface, no user
manual required
• Sleek design
• User interface & improve navigation
• Hold more music
• Applications-games, money
management, news, etc.
• Wireless internet on phone

11.
The Six Conventional Boundaries of Competition
To
Creating
Across
From
Competing
Within
Industry
Strategic group
Buyer group
Scope of product or service
offering
Functional-emotional
orientation of an industry
Time
Six Paths to Blue Ocean Strategy

12.
6 PATHS: Allows Exploration Outside of
Traditional Boundaries
Path 6 - Time
What trends have a high probability of impacting your industry, are
irreversible, and evolving in a clear trajectory? How will these
trends impact your industry? Given this, how can you open up
unprecedented customer utility?
Apple Music, Cisco Systems, CNN,
HBO’s “Sex and the City”
Path 1 - Industry
What are the alternative industries to your industry?
Why do buyers trade across to them?
NTT DoCoMo, Federal Express, Southwest Airlines, NetJets
Path 2 – Strategic Group
What are the strategic groups in your industry?
Why do buyers trade up for the higher group, and why
do they trade down for the lower one?
Polo Ralph Lauren, Curves, Sony Walkman, Toyota Lexus
Path 3 - Buyer Group
What is the chain of buyers in your industry?
Which buyer group does your industry typically focus on?
If you shifted the buyer group of your industry,
how can you unlock new value?
Novo Nordisk, Bloomberg Terminals, Canon Copiers, Philips
Alto
Path 4 - Scope of product or service offering
What is the context in which your product or service is used?
What happens before, during, and after? Can you identify the pain
points? How can you eliminate these pain points through a
complementary product or service offering?
Borders and Barnes & Noble, Dyson Vacuum Cleaners, Kinépolis
Kiné-kids, Zenick Salick’s Cancer Centers
Path 5 - Functional-emotional orientation of an industry
Does your industry focus on functionality or emotional appeal? If
you compete on emotional appeal, what elements can you strip out
to make it functional? If you compete on functionality, what
elements can be added to make it more emotional?
Starbucks, QB House, Direct Line Group, Pfizer’s Viagra

13.
PMS MAP

14.
Formulation Risks
Execution Risks
Formulation Principles
Execution Principles
Minimizing Risks & Maximizing Opportunities
in Formulating and Executing Blue Ocean Strategy
Focus on the big picture, not
the numbers
Search Risk
Reach beyond existing demand
Get the strategic sequence right
Overcome key organizational
hurdles
Build execution into strategy
Reconstruct market boundaries
Planning Risk
Scale Risk
Business Model Risk
Organizational Risk
Management Risk

15.
Purple Ocean Strategy
• Purple Ocean Strategy Just as Blue Ocean
Strategy states that a Red ocean Strategy
(Competitive Strategy) does not guarantee
success for the firm
• Purple Ocean strategy also claims that Blue
Ocean Strategy cannot guarantee the business
success in the long run since the Blue Ocean
strategy will finally turn Red.

16.
Purple Ocean strategy
• The Purple Ocean strategy believes that in
today’s business world organizations require
both innovative ideas as well as a series of
strategies to compete with rivalry and remain
functional in the long term.
• Consequently, the name Purple Ocean strategy
was initially adopted following the secondary
colour generated by combining red and blue
colours.

17.
References
• www.hbs.org

18.
THANK YOU