Red Ocean Traps highlights the negative effects of market saturation from "summary" of Blue Ocean Strategy with Harvard Business Review Classic Article “Red Ocean Traps” (2 Books) by W. Chan Kim,Renée A. Mauborgne
In a crowded marketplace where competition is fierce and differentiation is minimal, companies find themselves trapped in what we call the Red Ocean. The Red Ocean traps are a set of common traps that companies fall into when they operate in saturated markets. These traps hinder a company's ability to break away from the competition and create new market space. One of the traps is the commoditization trap, where companies focus solely on price competition and end up eroding their own value and profit margins. This trap leads to a downward spiral where companies are constantly undercutting each other, leaving no room for innovation or growth. Another trap is the bad profits trap, where companies prioritize short-term gains over long-term value creation. By cutting costs ...
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