Hello, I'd like to share with you a book I read recently - Blue Ocean Strategy - a business strategy book that may be applicable to any of you starting or owning a business. The concept of the book is expressed in several examples, and the culmination is this: how can you create uncontested markets (new markets) instead of competing in the current ones?
The authors illustrate the concept by using a metaphor - blue oceans and red oceans. In blue oceans, demand is created rather than fought over - a new product or service is invented, creating a new marketspace. Think of MP3 players or instant movie downloads, for example. There is a large opportunity for growth that is both profitable and rapid, since value is not charted based on competition.
In red oceans companies compete by grabbing for a greater share of limited demand. This is greatly illustrated by commodity markets, such as gas and other utilities. As the market space gets more crowded, prospects for profits and growth decline. All products turn into commodities, and increasing competition turns the water "bloody.", so to speak
There are two ways, delinated by the authors, to create blue oceans. One is to launch completely new industries, as eBay did with auctions online. However, much more common for a blue ocean to be created from inside a red ocean when a company expands the boundaries of an existing industry or market. This can be done by redefining your product, or service. Possibly adding new features, creating more value, or differentiating from the competition.
The authors have several (actually, more than 100) examples of ways this can happen. I believe that some of the most exciting and profitable ways can be online. The ability to create new advertising channels through PPC, add new web services to your website (or, create one if you don't have one), and use IT to cut costs and improve productivity can help.
To me, one of the most exciting things about protocol 80 is our ability to help you do this. We have assisted many businesses in e-commerce, web sites, IT, and advertising. Looking at these services as a provider for an expansion of your business, instead of just a cost, and therefore how best you can use them, is a great way to start.
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