Blue Ocean Strategy

Blue Ocean Strategy is a strategic approach to business and product development that focuses on creating uncontested market space rather than competing in existing crowded markets. The framework encourages innovation that makes competition irrelevant. Red oceans represent known market space where companies compete for share through incremental improvements and price competition. Blue oceans represent untapped market opportunities created through value innovation, simultaneously pursuing differentiation and low cost by reconstructing market boundaries. Blue Ocean tools include Strategy Canvas mapping value curves, Four Actions Framework with Eliminate-Reduce-Raise-Create, Six Paths Framework for reconstructing boundaries, Three Tiers of Noncustomers analysis, and Sequence of Blue Ocean Strategy development. Product managers apply this framework by questioning industry assumptions, looking across alternative industries, exploring non-customer segments, and redefining the buyer value proposition. Classic examples include Cirque du Soleil redefining circus, Netflix redefining video rental, and Nintendo Wii redefining gaming. The approach emphasizes creating new demand rather than fighting for existing customers, making strategic moves rather than following competitors, and aligning the entire value chain behind differentiation. Success requires systematic exploration of alternatives, willingness to challenge conventions, and focus on value innovation.