How Can Organizations Achieve High Profitable Growth?
By Brendan Murphy
Companies across the country are struggling to cope with the tough times of the economic recession and market decline. Traditional marketing strategies are being put into question. Companies are battling head-to-head with competitors for the same fierce markets.
Why are companies not achieving maximum performance and continuing to focus on market segmentation?
According to Chan Kim and Renee Mauborgne companies in search of the same overcrowded industries competing head-on results in nothing but a bloody “Red Ocean” of rivals fighting over a shrinking profit pool.
Marketing trends of late have focused on differentiation of product and low cost. But, have struggled to do so simultaneously. Companies have created differentiation in their products but at a higher cost. When they have focused on low cost in hopes of creating higher profit they have sacrificed the quality of their products.
The success of W. Chan Kim and Renee Mauborgne’s book, Blue Ocean Strategy¸ has challenged everything marketing specialists thought they knew about strategic marketing success. The book has been translated into 42 languages and has launched a worldwide business strategy revolution.
Blue Ocean Strategy focuses on making the competition irrelevant by creating new market spaces through simultaneous achievement of differentiation and low cost. The strategy finds the common ground of new uncontested waters avoiding the “red ocean” of competition to maximize profitable growth. The book is based on a study of 150 strategic moves spanning more than a hundred years and thirty industries.
Now more than ever marketing directors are evaluating their marketing strategies. When trying to understand blue ocean strategy and how it can apply to your business, it is essential to ask how blue is your marketing strategy?
Is your company able to recognize the limitations of your existing approach to strategy and generate new strategic growth? How can your company drive costs down while simultaneously drive value up? These are the questions you may need to ask if your competition is affecting your business.
The purpose of Blue Ocean Strategy is to make the competition irrelevant through a systematic approach. High profitable growth can be the result of moving from segmentation to desegmentation creating new demand in uncontested market spaces.
Kim and Mauborgne’s theories have been effectively used worldwide. For example, Nintendo Wii has experienced great success with the Blue Ocean Strategy. Nintendo Wii has not only been able to engage the part of the market that does play games, but also the people who’ve never played before and now love it.
Blue Ocean Strategy highlights six principles that every company can use to formulate and execute blue ocean marketing strategies. The new methodologies by Kim and Mauborgne truly upend traditional marketing strategies and set the foundation for the future of business. "
So during these tough times do not ask how your business can compete with competitors. Ask how blue is my strategy?
Brendan Murphy is the Marketing Manager for Strategize Blue (www.strategizeblue.com), a Blue Ocean Strategy Training and Consulting company based in San Diego. He works under Dr. Zunaira Munir, the internationally exclaimed expert and keynote speaker on Blue Ocean Strategy.
