REACHING BEYOND EXISTING DEMAND

Blue Ocean Strategy

Doug HentgesAustin Mapes

David MurdockCindal PetersonMolly Redden

MAXIMIZING BLUE OCEANS Reach beyond existing demand

Focus on existing customersDrive for finer segmentation to

accommodate buyer differences

MAXIMIZING BLUE OCEANS To maximize the size of their blue

oceans, Companies need to take a reverse courseLook to non-customers rather than focusing

on customersBuild on powerful commonalities in what

buyers value instead of focusing on customer differences

This allows companies to reach beyond existing demand to unlock a mass of new customers that did not exist before.

3 TIERS OF NON-CUSTOMERS 1st tier- “soon to be customers”

People closest to your marketMinimally purchase an industry’s offerings

out of necessity, but non-customers 2nd tier- “refusing customers”

People who voted against buying the company’s products

3rd tier- “unexplored customers”People who are the most distant from your

marketNon-customers who have never thought of

your market’s offerings as an option

3 TIERS OF NON-CUSTOMERS

Your Market 1st Tier 2nd Tier 3rd Tier

FIRST-TIER NONCUSTOMERS Soon-to-be noncustomers

Minimal use of market

Look for better opportunity

Wait for new demand from the market

PRET A MANGER British fast-food chain: looked for way to

find demand from first-tier noncustomersOffers restaurant quality sandwiches at very

fast speed

Sleek setting

Reasonable price

SECOND-TIER NONCUSTOMERS

Refusing noncustomers

JCDecaux

Creating value for everyone

THIRD-TIER NONCUSTOMERS Farthest away from an industry’s

existing customers Unexplored Customers Never thought of your market’s offerings

as an option

THIRD TIER EXAMPLES Teeth Whitening

Provided by dentists Branched out into areas not formally

marketed toCreated a new niche marketReached unforeseen customers

GO FOR THE BIGGEST CATCHMENT Focus on the tier with the biggest

catchment You may want to look across tiers Challenge existing strategic orientations Be aware of competitors

CONCLUSION There are 3 tiers of noncustomers

1st tier or “Soon to Be”: Do not buy out of necessity

2nd tier or “Refusing”: Do not buy industry offerings at all

3rd tier “Unexplored”: Never considered your industry offerings

You must profit from the blue ocean you are creating not just maximize the size