Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant

Blue Ocean Strategy was first published in 2005, at a time when the forces of globalization increasingly broke down traditional market barriers and promoted breakneck competition. Industries that had previously operated within national frontiers now had to contend with international players who could remain relevant by offering similar products at a cheaper production cost. Outsourcing production to overseas factories became an increasingly popular method to keep costs down, but this also opened the opportunity for competitors to imitate their practices. Most importantly, oceans everywhere were turning red from bloody competition, saturated markets, and stagnant demand.

At the time, the dominating market strategy theory assumed the inevitability of market competition and focused its efforts on teaching businesses how to remain afloat, even as products become increasingly undifferentiated and profit margins continue shrinking. The Porter model, for example, stipulates that companies in these situations could only pursue either differentiation or low costs. On one hand, if they sought to create a product that is a significant departure from their competitors, then the extra costs they incur for research and development would offset that advantage. This is because bloody competition forces out subpar products and leaves only the best standing, so any attempt at adding value is assumed to be costly.