Eassy
Chapter-5:
Reach Beyond Existing Demand
How do you maximize the size of the blue ocean you are creating? This chapter provides a guide to reaching beyond existing demand, encouraging companies to challenge the conventional strategy practices of focusing on existing customers and finer segmentation to accommodate buyer differences. Instead of concentrating on customers, companies need to look to noncustomers and build on powerful commonalities in what buyer’s value in order to unlock new markets.
Since the dawn of the industrial age, companies have engaged in head-to-head competition in search of sustained, profitable growth. They have fought for competitive advantage, battled over market share, and struggled for differentiation. Yet, these hallmarks of competitive strategy are not the way to create profitable growth in the future. In a book that challenges everything you thought you knew about the requirements for strategic success, W. Chan Kim and Renee Mauborgne argue that cutthroat competition results in nothing but a bloody red ocean of rivals fighting over a shrinking profit pool. Based on a study of 150 strategic moves spanning more than a hundred years and 30 industries, the authors argue that lasting success comes not from battling competitors, but from creating "blue oceans"--untapped new market spaces ripe for growth. Such strategic moves--which the authors call "value innovation"--create powerful leaps in value that often render rivals obsolete for more than a decade.
In this chapter, Professor W. Chan Kim introduces the way to maximize the size of the blue ocean. In order to achieve this result, you need to focus on the existing customer. Besides, you need to drive for finer segmentation to accommodate buyer differences. The managers should lead to finer segmentation and greater tailoring of offerings to better meet customer preferences. Those customers are non customers segment and they can create huge demand and sales volume to the business.
Reach Beyond Existing Demand
How do you maximize the size of the blue ocean you are creating? This chapter provides a guide to reaching beyond existing demand, encouraging companies to challenge the conventional strategy practices of focusing on existing customers and finer segmentation to accommodate buyer differences. Instead of concentrating on customers, companies need to look to noncustomers and build on powerful commonalities in what buyer’s value in order to unlock new markets.
Since the dawn of the industrial age, companies have engaged in head-to-head competition in search of sustained, profitable growth. They have fought for competitive advantage, battled over market share, and struggled for differentiation. Yet, these hallmarks of competitive strategy are not the way to create profitable growth in the future. In a book that challenges everything you thought you knew about the requirements for strategic success, W. Chan Kim and Renee Mauborgne argue that cutthroat competition results in nothing but a bloody red ocean of rivals fighting over a shrinking profit pool. Based on a study of 150 strategic moves spanning more than a hundred years and 30 industries, the authors argue that lasting success comes not from battling competitors, but from creating "blue oceans"--untapped new market spaces ripe for growth. Such strategic moves--which the authors call "value innovation"--create powerful leaps in value that often render rivals obsolete for more than a decade.
In this chapter, Professor W. Chan Kim introduces the way to maximize the size of the blue ocean. In order to achieve this result, you need to focus on the existing customer. Besides, you need to drive for finer segmentation to accommodate buyer differences. The managers should lead to finer segmentation and greater tailoring of offerings to better meet customer preferences. Those customers are non customers segment and they can create huge demand and sales volume to the business.