When launching a new business, there appears to be trade-offs that limit what you can offer. You can offer basic goods at low-cost or specialized goods at high-cost. You can sell many cheap products/ services or you can sell few quantities of more expensive products. There are few companies that can completely set themselves apart from their competition and offer an amount of differentiation consumers want while at the same time keeping costs low. These companies are using Blue Ocean strategies in order to compete with a seemingly unmoving status-quo.
Uber’s unique business structure persuaded many drivers to provide service on the platform, increasing the supply of drivers that customers can potentially get a ride from and lowering ride costs compared to traditional taxicab services. Now, driving services do not only include taxis and limos but as well as companies such as Uber & Lyft. Blue Ocean strategies can lead to entire markets and industries shifting. The old leaders, taxi companies, were too rooted into their traditional business structure that they could not see a legitimate way for themselves to adopt a Blue Ocean strategy. It shows a strong implication that newer companies have a chance at becoming marketing leaders in a relatively short amount of time!
AirBnB was also once a new company competing with established market leaders. By offering the specialization that virtually anyone can rent out their space, whether its a room, or an entire house to complete strangers, AirBnB was able to compete with hotels, motels, bed & breakfasts on their own terms.
More recently, Tesla is a company taking a blue-ocean strategy in its industry. In response, the industry as a whole is adding more specialized electric vehicles at relatively lower costs. Additionally, other big name companies are following Tesla’s lead and accepting Bitcoin for payments.
Small businesses are capable to compete with established leaders but they will need to understand how they can adopt more Blue Ocean strategies. “What can we do that no one else can?” “Where can we go that no one else will?
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