Red ocean strategies represent approaches to protecting and stealing market share from competitors. To successfully operate in a red ocean, it is important for companies to conduct competitor analysis to allow them to stay updated on what their competitors are doing and what they are planning to do. The red ocean represents the existing market space where there is always a constant intensity of rivalry to fight for market share. Furthermore, the paper will discuss the differences between the SWOT analysis and the four actions framework.Ĭompeting in existing market space versus Creating new market space In this paper I will discuss the differences between conventional red ocean strategies which are influenced by Porter and Kim and Mauborgne’s blue ocean strategy. Kim and Mauborgne present to us in their book a fresh approach to make the competition irrelevant. Traditional approaches to competitive strategies are highly influenced by Michael E. The analogy of a blue ocean can be associated with profitability and growth being “vast”, “deep” and “powerful”. The Authors uses the blue ocean analogy to describe the uncontested market space with no competitors and the opportunity to explore. In blue oceans, competition is not relevant because the rules or barriers to the market space is not set yet and is often waiting to be set. In contrast, blue oceans is the unknown market space where it is unaffected by competition and demand is created rather than fought for. Kim and Mauborgne explains in an interview that when market spaces become crowded with competitors, companies try out perform each other and profits and growth is greatly reduced due to cutthroat style competition which turns the red ocean bloody. The red ocean contains a massive conflict between companies where they are constantly trying to outperform each other to achieve a greater share or demand. Red ocean is the market space where industry boundaries are defined and known. One of the reasons why the authors have used the colours red and blue is to describe the market. Chan Kim and Renee Mauborgne is a strategy that challenges companies to distance itself away from fierce competition by establishing uncontested market space that makes existing competition irrelevant.
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