blue ocean strategy
DESCRIPTION
Blue Ocean Strategy of Mobilink PakistanTRANSCRIPT
How to create uncontested market space
and make the competition irrelevant
Two worlds …
Two worlds …Red Ocean Strategy Blue Ocean Strategy
Compete in existing market space.
Create uncontested market space.
Beat the competition. Make the competition irrelevant.
Exploit existing demand. Create and capture new demand.
Make the value-cost trade-off. Break the value-cost trade-off.
Align the whole system of a strategic firm's activities with its choice of differentiation or low cost.
Align the whole system of a firm's activities in pursuit of differentiation and low cost. VALUE INNOVATION
Value Innovation The cornerstone of Blue Ocean
Strategy
Value-cost trade-off (Conventional Believe)
Differentiation and Low cost simultaneously(Blue Ocean Strategy)
VIVI
VALUE
COST
Value-Innovation
The rising Imperative of Creating Blue Oceans
• Supply exceeds demand
• Globalization
• Increasing price wars
• Shrinking profit margins
• Brands are becoming more similar select
based on price
Mobilink
Features of CompetitionLow call ratesBundle offersInternational RoamingMobile Internet UsePromotional StrategiesEasy Paisa
New Features of Competition
Mobile BankingPurchase of Air Ticket, Railway TicketsBillingFund TransferSatellite Roaming
Features for competition
Mobile Banking(Balance Enqiry,Confirmation)
Fund Transfer from one Account or Bank to another Bank
Fund Transfer(Easy Paisa)
Buy E-Tickets(Railway, Air)
Satellite Roaming
Hotel Room Reservation
Least Offered Features Not Offered Features
BOS Logic: The Core Principles
1. Reconstruct Market Boundaries… overcome believes.
2. Reach beyondexisting Demand… go for uncontested space.
3. Get the strategic sequence right… value [innovation] first.
VIVI
COST
VALUE
BOS Logic: 1. Reconstruct market boundaries
Industry Focuses on rivals within its industry
Strategic Group Focuses on competitive position within strategic group
Buyer Group Focuses on better serving the buyer group
Scope of Product and Service
Offerings
Focuses on maximizing the value of product and service offerings within the bounds of its industry
Functional-emotional Orientation of an
Industry
Focuses on improving price-performance with the functional or emotional orientation of this industry
Time/Trends Focuses on adapting to external trends as they occur
Establishing Consortium/Joint Ventures with other industries like Baking, Hotel industry etc.
Instead of focusing on local users only, all classes of clients who are technology pioneer and value poineer.Frequent Movers to international markets.CEO & Top executives of MNCs who travel a lot.
Mobile BankingPurchase of Air Ticket, Railway TicketsBillingFund TransferSatellite Roaming
Prestigious group, Ego Sensitive, Reference Group
Trend Setters, Ist movers advantages,Eraly Adopters
Boundaries of Competition
Head-to-HeadCompetition
Creating New Market Space
Reach beyondexisting Demand… go for uncontested space.
BOS Logic: 2. Reach Beyond Existing Demand
Companies should challenge two conventional strategy practices: 1. Focus on existing customers.
2. Drive for finer segmentation to accommodate buyer differences.
Core Customer Noncostumer
Soon-to-be-NC Refusing Customer
BOS Logic: 2. Reach Beyond existing Demand
Three Tiers of Noncustomers
Your Market
First TierSMS, Low Call
Second Tier
Int. Roaming, MMS,Internet
Third Tier
Technology PioneerEarly Adopters
BOS Logic: 3. Get the Strategic Sequence rightBuyer utility
Is there exceptional buyer utility in your business idea?
Adoption
What are the adoption hurdles in actualizing your
business idea?Are you addressing them up
front?
PriceIs your price easily
accessible to the mass of buyers?
Cost
Can you attain your cost target to profit at your
strategic price?
A commercially viable Blue Ocean Strategy
YES
YES
YES
YES
No Rethink
No Rethink
No Rethink
No Rethink
What factors should be eliminated that the industry has taken for granted?
Eliminate
What factors should be reduced well below the industry standard?
Reduce
What factors should be created that the industry has never offered?
Create
What factors should be raised well beyond the industry standard?
Raise
Four Actions to create a Blue Ocean
BOS & Mobilink
Application Four Actions Framework
A New Value Curve
Reduce
Eliminate Create
RaiseThe concept/Attitude that “PTCL is not serving Pakistani market well, landlines are no more in usage, PTCL hiring is political based, PTCL has left the market for others, need to be eliminated.
All people/complete market who are price sensitive, focused on low offers & who fight on low price.
Mobile BankingPurchase of Air Ticket, Railway Tickets, Billing, Fund TransferSatellite Roaming
Offerings beyond SMS, MMS, and Local call rates, International Roaming, International calls
Strategy Canvas
High
Low
Call Rates SMS BundleMMS Bundle
Roaming
Internet
HotelSatellite Roaming
Factors the industry currently competes on
Ticketing