2. What is Strategy?
• Strategy is the course of action of decisions that are
long term performances and are usually unique in
nature.
• A plan of action designed to achieve a long-term or
overall aim.
• Strategy is the direction and scope of an
organization over the long-term
3. What is Blue Ocean Strategy?
• Blue ocean strategy generally refers to the creation
uncontested market space by a new company, that
makes competitors irrelevant and that creates new
consumer value often while decreasing cost.
• BOS is all about minimizing risks due to
competition threat and maximizing opportunities
by exploring new boundaries.
• Blue ocean strategy means, the market where
market boundaries and industry structure can be
reconstruct by the actions and beliefs of industry
players.
4. CHARACTERISTICS OF BLUE OCEAN
STRATEGY
• Non Existent Industries
• Undefined Market Space
• Undefined Industry Boundaries
• Unknown Competitive Rules
• Value Innovation
• Innovation & Creativity
• Create a Market
• Developing Future Demand
• Focus on Creating Future Customers
5. BLUE OCEAN STRATEGY
ADVANTAGES
• Sets standards
• High profit margin in a
new market
• A blue ocean strategic
move can create brand
equity that could last for
decades.
DISADVANTAGES
• Intermediate strategy
• Eventually becomes
red ocean
• If frameworks are not
properly executed, it
promote market
complacency.
6. WHAT IS RED OCEAN STRATEGY?
• Red Ocean Strategy is a head-to-head battle
where the players of a particular segment
compete with each other remaining in the same
market space i.e. within the boundaries of the
same industry on the principle of ‘competitive
advantage.
• Red oceans represent all the industries in
existence today as the known market space. In
the red oceans, industry boundaries are defined
and accepted, and the competitive rules of the
game are known.
7. CHARACTERISTICS OF RED OCEAN
STRATEGY
• Existing Industries
• Defined Industry Boundaries
• Defined Market Space
• Known Competitive Rules
• Low Profit Growth Opportunity
• Competitive Advantage
• Low Cost or Differentiation
• Beat the Competition
• Exploit Existing Demand
• Focus on existing customers
8. Red Ocean Strategy
ADVANTAGES
• The market is already
established.
• It is clear what
products and services
customers want.
DISADVANTAGES
• There is usually an
established market leader
who will be very hard to
beat.
• There are usually numerous
niche who are trying to carve
out market share in a subset
of the total market.
• Here competition is
assemble ferocious
aggressiveness.
9. DIFFERENCES BETWEEN RED OCEAN AND BLUE
OCEAN
BLUE OCEAN
• System Approach
In Blue Ocean strategy
system approach is towards
creativity and innovation
• Customer Focus
Blue ocean strategy focuses
on creation of new
customers.
• Profit Opportunity
Profit opportunity of using
Blue Ocean Strategy is
High.
RED OCEAN
• System Approach
In Red Ocean strategy
system approach is towards
low cost and differentiation.
• Customer Focus
Red Ocean strategy focuses
on existing stream of
customers.
• Profit Opportunity
Profit opportunity of using
Red Ocean Strategy is low.
10. CONTIN.
BLUE OCEAN
• Goal
Goal of this strategy plan is
to brake the value-cost-
trade-off.
• Competition
This strategy focuses on
creation of uncontested
market space.
• Example
Nintendo Wii, iTunes, Apple,
Microsoft, Ryanair etc.
RED OCEAN
• Goal
Goal of this strategy plan is
to make value-cost-trade-
off.
• Competition
This strategy focus on the
competition within the
existing market space.
• Example
PlayStation, FIFA, etc.
