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Blue Ocean Strategy

Blue Ocean Strategy is a concept and a framework for business strategy development that was introduced by W. Chan Kim and Renée Mauborgne in their 2005 book “Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant.”

The idea behind Blue Ocean Strategy is that businesses should not try to compete with their rivals in the “red ocean” of existing market space, where competition is fierce and margins are low. Instead, they should aim to create new “blue oceans” of uncontested market space, where they can offer unique and innovative products or services that meet the needs of untapped or underserved customer segments.

To create a blue ocean, businesses must shift their focus from competition to innovation, and create value for customers in new and unexpected ways. The Blue Ocean Strategy framework involves a systematic approach to identifying and developing new market opportunities, using tools such as the “strategy canvas” to analyze and compare existing market offerings, and the “four actions framework” to identify ways to create new customer value.

Some potential benefits of using Blue Ocean Strategy include:

  • Creating new market opportunities and unlocking untapped customer segments
  • Reducing competition and improving profitability by creating uncontested market space
  • Driving innovation and creating unique value propositions that differentiate a business from its rivals
  • Improving customer satisfaction and loyalty by meeting unmet customer needs

Overall, Blue Ocean Strategy is a powerful framework for businesses that are looking to differentiate themselves from their competitors, create new market opportunities, and succeed in an increasingly crowded and competitive business landscape.


Here are a few examples of businesses that have used Blue Ocean Strategy to gain a competitive advantage:

Cirque du Soleil – Cirque du Soleil is a contemporary circus troupe that was founded in Canada in the 1980s. Rather than competing with traditional circuses that featured animals, acrobatics, and clowns, Cirque du Soleil created a new “blue ocean” of entertainment by combining circus arts with theater and live music. They focused on creating a sophisticated, artistic experience that appealed to adults and families, rather than relying on traditional circus tropes. As a result, they have been able to charge premium prices and establish a strong brand identity.

Nintendo Wii – When the Nintendo Wii was released in 2006, it disrupted the video game console market by creating a new type of gaming experience. Instead of relying on high-end graphics and complex gameplay, the Wii focused on creating a fun, accessible experience that appealed to a wider audience. The console’s innovative motion-sensing controller allowed players to physically interact with games, making it a hit with families and casual gamers. By creating a new “blue ocean” of gaming, Nintendo was able to outsell its more powerful competitors, the Xbox 360 and PlayStation 3.

Southwest Airlines – Southwest Airlines was founded in 1967 and entered a crowded and highly competitive market dominated by legacy carriers like American, Delta, and United. Rather than trying to compete head-to-head on features like in-flight meals and seating comfort, Southwest created a new “blue ocean” by focusing on low prices, customer service, and efficiency. They introduced a no-frills approach that allowed them to offer lower fares than their competitors, and they created a culture that emphasized friendly service and on-time performance. Today, Southwest is one of the largest and most successful airlines in the world.

Casper – Casper is a mattress company that was founded in 2014. Rather than competing with traditional mattress companies that offered a confusing array of options, Casper created a new “blue ocean” by simplifying the buying process and offering a single, high-quality mattress that could be purchased online. They also focused on making the buying experience enjoyable and stress-free, with free shipping, a 100-night risk-free trial, and easy returns. Today, Casper is one of the most successful online mattress companies, with a strong brand identity and a loyal customer base.

Tesla – Tesla is an electric car company that was founded in 2003. Rather than trying to compete with established car manufacturers on price, Tesla created a new “blue ocean” by focusing on innovation, design, and sustainability. They introduced high-end electric vehicles that were faster, more efficient, and more environmentally friendly than their gas-powered counterparts. They also created a network of charging stations that made it easy for drivers to charge their cars on long trips. Today, Tesla is one of the most valuable car companies in the world, with a market capitalization that rivals that of traditional automakers like Ford and General Motors.

Dollar Shave Club – Dollar Shave Club is a subscription-based razor company that was founded in 2011. Rather than competing with traditional razor companies that offered expensive, complex blades, Dollar Shave Club created a new “blue ocean” by offering a simple, affordable alternative. They introduced a subscription-based model that delivered high-quality razor blades to customers’ doorsteps every month, at a fraction of the cost of traditional blades. They also created a humorous, irreverent brand identity that resonated with customers. Today, Dollar Shave Club is one of the most successful subscription-based companies in the world, with a loyal customer base and a strong online presence.

These are just a few examples of how businesses have used Blue Ocean Strategy to create new market opportunities and gain a competitive advantage. By focusing on creating unique and innovative value propositions, these companies were able to differentiate themselves from their competitors and establish themselves as leaders in their respective industries.