Creating new demand is a central component of blue ocean thinking from "summary" of Blue Ocean Strategy with Harvard Business Review Classic Article “Red Ocean Traps” (2 Books) by W. Chan Kim,Renée A. Mauborgne
The essence of blue ocean thinking lies in creating new demand rather than competing within established markets. This fundamental concept diverges from traditional strategies that focus on outperforming rivals in existing industries, known as red ocean thinking. By shifting the focus to creating new demand, companies can break away from the cutthroat competition that characterizes red oceans. Creating new demand involves identifying and capturing untapped market space, which allows companies to make competition irrelevant. This approach enables businesses to explore opportunities beyond the confines of existing industry boundaries and find new ways to deliver value to customers. Rather than fighting for a share of the existing market, companies practicing blue ocean thinking aim to expand the market by offering innovative products or services that appeal to non-customers or create entirely new customer segments. In blue oceans, companies can set their prices based on the value they provide rather than engaging in price wars with competitors. By creating new demand, businesses can unlock opportunities for profitable growth without being constrained by the limitations of existing markets. This strategy allows companies to differentiate themselves from competitors and establish a unique market position that is difficult for rivals to replicate. The process of creating new demand requires companies to challenge industry assumptions and rethink the way they compete. By focusing on innovation and value creation, businesses can open up new avenues for growth and establish a sustainable competitive advantage. This approach not only allows companies to escape the confines of red ocean competition but also paves the way for long-term success and profitability.- Creating new demand is at the heart of blue ocean thinking, enabling companies to chart a course towards uncontested market space and sustainable growth. By shifting the focus from competing in existing markets to creating new markets, businesses can break free from the constraints of red ocean thinking and unlock opportunities for innovation, differentiation, and value creation. This strategic shift empowers companies to explore new possibilities, redefine industry boundaries, and secure a competitive advantage that is both unique and enduring.
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