Red Ocean vs Blue Ocean Strategies by Iqra University (North Nazimabad Campus Students Subject STRATEGIC MARKETING MANAGEMENT Fall Semester 2017)

1. BLUE OCEAN STRATEGY
An Overview of Red v/s Blue
Subject: STRATEGIC MARKETING MANAGEMENT
Teacher Name: Miss Shahper Ahsan
Group Members:
1. Farrukh
2. Syed Qamar Abbas Rizvi 8244
3. Muti ur Rehman
4. Humaira Kiran 8665
5. Sehar Afshan 8580

2. So what is RED OCEAN ?
MARKET SPACE THAT SEVERAL
COMPANIES ALREADY EXPLORED
AND COMPETE IN
- COMPETES IN EXISTING
MARKET SPACE
- AIMS TO BEAT COMPETITION
- EXPLOITS EXISTING DEMAND

3. So what is BLUE OCEAN ?
DESCRIBES AN UNCONTESTED
MARKET SPACE FOR AN UNKNOWN
INDUSTRY OR INNOVATION
- CREATES UNCONTESTED MARKET
SPACE
- AIMS TO MAKE COMPETITION
IRRELEVANT
- CREATES & CAPTURES NEW
DEMANDS

4. THE WAY TO SUCCEED IS TO COME UP WITH
NEW VALUE INNOVATION FOCUSING ON
MAKING THE COMPETITION IRRELEVANT

5. VALUE INNOVATION

6. ANALYTIC TOOLS AND FRAMEWORK
3 STEPS:
1. STRATEGY CANVAS
2. FOUR ACTIONS FRAMEWORK
3. ELIMINATE-REDUCE-RAISE-
CREATE GRID

7. 1. STRATEGY CANVAS
 The STRATEGY CANVAS IS BOTH A DIAGNOSTIC AND FRAMEWORK
 FOR BUILDING A COMPELLING BLUE OCEAN STRATEGY.
 IT ALLOWS YOU TO UNDERSTAND THE COMPETITION.

8. 2. FOUR ACTIONS FRAMEWORK

9. VALUE INNOVATION: THE CORNESTONE OF BLUE OCEAN STRATEGY
 Value innovation is created in the region where a company’s actions favorably
affect both its cost structure and its value proposition to buyers.
 Cost savings are made by eliminating and reducing the factors an industry
competes on.
 Buyer value is lifted by raising and creating elements the industry has never
offered.
 Over time, cost are reduced further as scale economies kick in due to the high
sales volumes that superior value generates.

10. 3. ELIMINATE-REDUCE-RAISE-CREATE GRID

11. Impact of Creating
Blue Oceans

13. The setting: the US wine industry, in 2000...
The third largest aggregate consumption of wine worldwide
Highly competitive industry
Large share of California-based producers
Several imported wines from France, Italy, Spain, Chile, Australia and Argentina
Consolidation (8 companies produce more than 75% wine)
Stagnant demand
Battle for shelf space
Rising marketing & advertising costs
[yellow tail]

14. [yellow tail]

15. What were the results?

16. 2000, Casella Wines introduced [yellow tail] in the US
2001, about 112,000 cases were sold
2002, it became the fastest growing brand in the histories of both the Australian and the US wine industry; it was number one imported wine into the US (more than French and Italian wines)
2003, it became number one red wine in 750ml bottle sold in the US (more than the same Californian wines)
2005, about 7,500,000 cases sold

17. Other Examples