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Blue Ocean Strategy – Group 12

-AJAY NORMAN (DM18202)-ANKUR KISLAYA (DM18206)

-MELISSA MARIAM ALEX (DM18233)-SAURABH ARORA (DM18246)-SHIVAM SHUKLA (DM18248)

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Red Ocean Strategy

Known market space

Industries boundary are well defined and accepted

Competitive rules of the game are known

Outperform rivals and grab a greater share of existing demand

Crowding: prospects for growth and profits are reduced

Commoditization and cut throat competition (Red ocean)

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Blue Ocean strategy

Untapped market space Opportunity for highly profitable growth Create from red ocean by expanding the existing industry boundaries Competition is irrelevant since rules of game are yet to be set

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Red vs Blue

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Can we ignore red ocean?

Red ocean will always matter

However, supply exceeding demand in most industries, competing for

a share of contracting market will not be enough

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Profit and Growth consequences

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Impact of creating Blue oceans

86% of these launches were “Line extensions”

Only 14% were aimed at creating new markets

These 14% resulted in 61% of profits

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Rising imperative for creating Blue ocean Trade barriers dismantled – Globally available products and prices.

No clear evidence of increasing demand.

Accelerated commoditization, price wars and shrinking margins.

Differentiating becomes harder in red ocean.

So now what? – Create demand and delve into other ocean.

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Reconstructionist view of strategy

Tools are available to survive in red oceans.

No benchmarking of competitors. Create value for buyers and company.

Market boundaries are reconstructed.

No differentiation costs in blue ocean.

Competition – an irrelevant factor.

Blue ocean – Costs reduce, Value for buyers increases.

Whole system alignment – utility, price, and costs.

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Strategy canvas - US Wine industry

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Four action framework

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Four actions framework – In Yellow tail

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Three characteristics of good strategy Focus on efforts and not on all factors od competition.

Diverge from other players – looking at alternatives

Tagline – Fun and simple wine.

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Reading the value curve

Litmus test to check if the company is in right track. No focus – high cost structure

No divergence – “me-too”

No tagline – innovation for innovation’s sake.

Value curve merging of one company with other – Red ocean signal.

Incoherent strategy – Zigzag curve.

Strategic considerations – High on one factor and ignore others.

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