A few days back while chatting with friends, I came across a concept “Blue Ocean Strategy” and was quite surprised and amazed by it. The Blue Ocean Strategy (BOS) asks you to create uncontested market space, thereby making competition irrelevant. It involves creating and capturing the new demand, breaking the value-cost tradeoff and aligning all the company’s activities towards differentiation and low cost. As I read more about it, the concept seemed very innovative, challenging and motivating.

In marketing there are generally two strategies viz. Red Ocean Strategy and the Blue Ocean Strategy. These are abbreviated as RO-BO. The Red Ocean Strategy will tell you to compete in existing markets and beat competition. It will require you to exploit the existing demand, make a value-cost tradeoff and align a company’s activities with its strategic choice of differentiation or low cost.

BOS has been used in many sectors including information technology and today there are several IT companies in the market which owe their success to Blue Ocean Strategy. Earlier when one thought about gaming consoles, only two names came to mind – Microsoft XBOX and Sony PLAYSTATION. When XBOX 360 and PLAYSTATION 3 were ruling the existing market (Red Ocean Strategy) another gaming console company NINTENDO used the Blue Ocean Strategy and launched their own gaming console NINTENDO WII with unique motion-sensitive motion control stick (the stick integrates the movements of a player directly into the video game) and built-in Wi-Fi at comparatively cheaper price than its competitors, XBOX and PS3. However, NINTENDO WII lacked features such as CD or DVD support, or built in hard disk, and surround sound.

Similarly, NAPSTER using Blue Ocean Strategy, started online music file sharing service way back in 1999, the first of its kind. In 2003, Apple launched iTunes online music store which was a good step towards stopping music piracy. Between the year 2003-2008, Apple teamed up with major music and motion picture companies to sell their music albums and even individual songs at a fair price while providing 30 seconds of free listening. By 25^th December, 2007 they had sold 20 million songs.

YOUTUBE too was launched in mid-February 2005 based on the same Blue Ocean Strategy, wherein adobe flash technology is used to display a wide variety of user generated video content.

Being an IT enthusiast I really feel like saying thanks to Blue Ocean Strategy which led to the creation of these never seen before products and services.Let’s just hope to see more of such new inventions and innovations in the times to come.