Friday, December 08, 2006

Purple Cow, Blue Ocean Strategy

Strategic innovation can be achieved in these areas:

  1. Building new markets for the products / services (like eBay).
  2. Creating added value for the customer.
  3. Inventing new business models.
  4. Establishing new distribution methods (Dell).

In Blue Ocean Strategy, the authors discuss the typical strategy: "Yet in today ’s overcrowded industries, competing head-on results in nothing but a bloody "red ocean" of rivals fighting over a shrinking profit pool." This would be telecom and cable. Static markets like TV, cellular and phone are "bloody oceans". That's why the strategy has to be like eBay or Starbucks or Whole Foods, who created a new market segment. "The aim of Blue Ocean Strategy is not to out-perform the competition in the existing industry, but to create new market space or a blue ocean, thereby making the competition irrelevant."

In Purple Cow, Seth Godin talks about creating a remarkable service or product. As internet access and web hosting become "commodities", you have to find a way to be remarkable. Delaware.Net is working on this. Remember: "What is not different is not strategic."

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