The Blue vs Red Ocean - Infusion Group Ltd

Your solution to growth

The Blue & Red
Ocean

One of the cornerstones of long-term business success surrounds how businesses differentiate themselves from their opposition. Ok yes, this sounds easy, but in our experience, it is truly surprising just how few actually take time out to focus on this hugely important area.

You may have heard about adopting a Blue Ocean strategy but what does this really mean?

Essentially it is all about adopting a business strategy that seeks to make your competition become totally irrelevant. This is achieved through delivering a new product or service proposition that focuses on up-tapped new market spaces that are ripe for growth, whether it’s a new product into a new market or a current product into a new market.

So, let’s consider that Red Oceans represent existing markets where fierce competition exists, whereas Blue Oceans represent markets that do not yet exist or are immature and have plenty of scope for expansion.

Your typical market will have an ambundance of competition with a myriad of companies offering comparative products or services. It’s no surprise to hear that circa 90% of all new businesses fail across the UK within the first 3 years of trading. By entering into a highly competitive market it can be extremely difficult to become noticed and to win business the market leaders. When you operate within such a competitive market you are likely to get eaten by one of your more established competitors, hence the term Red Ocean. Within these markets, in order to survive, companies aim to beat their competition through delivering their products and/or services at the cheapest possible price or through offering a better value proposition.

In the 1990’s the mobile phone industry would have been seen as a Blue Ocean as they were new to the market and significant evolution and opportunity has occurred across this market ever since.

However, given the fierce competition that exists within this industry today you would now very much pitch this industry as a Red Ocean making success for new entrants extremely difficult.

To help bring this to life let’s take a look at a few real-life examples.

Charities
The concept of raising money for a given charity has been around for many years. However, Comic Relief created a Blue Ocean for itself within this hugely competitive market through the creation of their Red Nose Day. In 2019 alone Comic Relief managed to raised £64m just through utilising a different strategy that allows for mass participation.

Aviation
Ryannair were one of the first airlines to penetrate the previously impenetrable market of flying. By creating an airline that solely focused on low cost flying with everything else (e.g. baggage, food etc) becoming optional extras it was able to create a new untapped market which didn’t mean that they had to compete with the more established brands such as British Airways or Virgin Atlantic.

Gaming
The gaming industry continues to see record growth year on year which makes Blue Oceans less easy to identify. However, in 2006 Nintendo found their very own Blue Ocean through the launch of its new Wii console. This allowed non-gamers to access the market which previously they would never have considered.

Transportation
Uber and Deliveroo are another 2 prime examples of companies who have disrupted long standing industries through developing innovative solutions which have changed the landscape within Markets that people never thought possible.

Now that we understand a little more around Blue Oceans, it’s time to consider the pitfalls of not evolving with the times and having a sense of innovation at your core.

Blockbuster video was a giant within the movie rental market and was certainly the market leader for many years. Sadly, Blockbuster became complacent and didn’t evolve allowing new market entrants such as Netflix and Amazon to take over which led to the ultimate demise of Blockbuster. There are countless examples of where such complacency has led to market leading institutions failing e.g. Monarch Airlines, Thomas Cook, Mothercare, Woolworths to name just a few.

Blue Oceans can prove to be hugely successful and lucrative once found. The key here is to identify a new value proposition that will allow you to clearly differentiate yourselves and to create a space that will enable you to grow and thrive without competition.

We would ask you to consider – when was the last time you undertook a deep analysis of your market and posed yourselves the following questions;

1.     Which factors should be reduced well below the industry’s standard?
2.     Which factors should be created that the industry has never created?
3.     Which factors should be raised well above the industry standard?
4.     Which of the factors that the industry takes for granted should be eliminated?

The above questions should force you to consider perceived truths within your market and to help you identify how you may look to adjust your existing offering.

If we take our market of business growth and consulting as an example. There are over 700,000 business consulting firms globally so entering into this market is fraught with danger given the fierce competition that exists today.

However, at Infusion Group we fully recognise this challenge hence why we have a unique delivery model that seeks to form a long-term partnership with our clients rather than just take on a bespoke piece of work and then write up a complex report in exchange for an expensive fee.

We at Infusion actually help our clients with implementation and execution of business challenges as we find that SME clients in particular require this additional level of support. Often these businesses excel at delivering their own product or service but lack in the change/project management disciplines and implementation side of things. This is where Infusion Group come in.

If you want to find your Blue Ocean get in touch now at info@infusion-group.co.uk