Download - Blue Ocean Strategy Rbn V1
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
Blue Ocean Strategy Blue Ocean Strategy
ImplementationImplementation
Presented by:
Reyland B. Nepomuceno, MBA
General Manager – International Business Division
Netpia Phils, Inc.
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
The Path to Blue OceanThe Path to Blue Ocean
• “Imagination will often carry us to worlds that never were. But without it we
go nowhere.”
- Carl Sagan
• “All men who have achieved great things have been great dreamers.”
-Orison Swett Marden
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
What is Blue Ocean Strategy?What is Blue Ocean Strategy?
• Creating New Markets
• Shift in Paradigm
• Value Innovation: The cornerstone of BOS
• Hybrid of Differentiation and Low-Cost Strategy
• Traditional Marketing Focuses on serving “Customers”
• BOS focuses on serving “Non-Customers”
• Defense against thinning profit margins in Red Ocean
• Red Ocean = Marketing is War!
• Blue Ocean = Reinventing the Market
Create Uncontested Market SpaceCompete in Existing Market
Make Competition IrrelevantBeat the Competition
Create and Capture New DemandExploit Existing Demand
Differentiation and Low-Cost StrategyDifferentiation or Low-Cost Strategy
Break the Value-Cost Trade OffValue-Cost Trade Off
Blue OceanBlue OceanRed OceanRed Ocean
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
Value InnovationValue Innovation
• Value Innovation is created in the region where a company’s actions entail:
– Cost Savings: elimination and reduction of factors where industry
competes on
– Buyer Value: raised through creation of elements the industry has never
offered
ValueInnovation
Costs
Buyer Value
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
Blue Ocean FrameworksBlue Ocean Frameworks
• 6 Principles of Blue Ocean Strategy
• Strategy Canvass
• 4 Actions Framework
• PMS Map
• 3 Tiers of Non-Customers
• Blue Ocean Strategy Sequence
• Buyer Experience Cycle
• Price Corridor of the Mass
• Blue Ocean Index
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
6 Principles of Blue Ocean Strategy6 Principles of Blue Ocean Strategy
• Formulation Principles
– Reconstruct Market Boundaries
• Look Across Alternative Industries (different form but same purpose)
• Look Across Strategic Groups w/in Industries (pursue similar strategy)
• Look Across Chain of Buyers (not just the end-user but the influencer)
• Look Across Complementary Products & Service Offerings
• Look Across Functional or Emotional Appeal to Buyer
• Look Across Time (Proactive not Reactive)
– Focus on the Big Picture, Not the Numbers
– Reach Beyond Existing Demand
– Get the Strategic Sequence Right
• Evaluation Principles
– Overcome Key Organizational Hurdles
– Build Execution into Strategy
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
Strategy CanvassStrategy Canvass
• Diagnostic and an Action Framework
• Reveals where the Competition is Investing
• Dissects the factors where the Industry currently competes in Product, Service and Delivery
• Reveals “Gaps” in the current market offerings
• Looking to “Alternative Industries” for Differentiation Focus
Price Meals Lounge Seating
Classes
Friendly
ServiceSpeed Frequent
Departures
Ave. Airline
Car Transport
Cebu Pacific
X-Factor
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
4 Actions Framework4 Actions Framework
• Customers may be “Over-served in Areas which are not critical” and “Underserved” in areas that matter to a specific market
• Core of the Blue Ocean = Enables the Fusion of Differentiation and Low-Cost Strategy
• ELIMINATE – Factors that Industry Takes for Granted
• REDUCE – Factors that should be reduced below industry Standard
• RAISE – Value Factors above industry standard
• CREATE – New Factors that Industry has not offered
CREATERAISE
REDUCEELIMINATE
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
4 Actions Framework: 4 Actions Framework: SisigSisig Hooray!Hooray!
-Time of Availability
(Any time of the day)
-Place of Availability
-Taste
-Convenience
(Disposable Styro)
CREATERAISE
-wait time (They actually raised the bar
as it is served quicker)
-cost = plastic spoon
and fork
-price = P50
-Above the Line
Advertising
(They use Blogs)
-Beer that is usually
partnered w/Sisig
-Bar Music / Entertainment
-comfortable seats
-Sizzling Plate
REDUCEELIMINATE
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
PMS MapPMS Map
• Defines a Roadmap to your Target Market
Pioneer, Pioneer, MigratorMigrator and Settersand Setters
“The SoulNever ThinksWithout anImage”-Aristotle
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
3 Tiers of Non3 Tiers of Non--Customers (Targeting)Customers (Targeting)
Tier 3: Non-Customers
That have never thought of your market’s offerings as an option
(Their Needs have been Assumed to Belong to other Markets)
Tier 2: Non-Customers
That refuse to buy your Industry’s Offerings
(Either they find it Unacceptable or Beyond Their Means)
Tier 1: Mainly Buy
Industry offering Out of necessity
“Soon-to-be” Non-Customers
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
Blue Ocean Strategy SequenceBlue Ocean Strategy Sequence
Exceptional Buyer Utility?
A Commercially Viable Blue Ocean
Affordable to Masses?
Buyer Utility
Price
Can you Attain Cost Target to ProfitAt Strategic Price?
Cost
Adoption Hurdles Being Addressed?
Adoption
YES
YES
YES
YES
No, Rethink
No, Rethink
No, Rethink
No, Rethink
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
Buyer Experience CycleBuyer Experience Cycle
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
Price Corridor of the MassPrice Corridor of the Mass
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
Blue Ocean Idea Index (BOI Index)Blue Ocean Idea Index (BOI Index)
NintendoWii
SonyPS3
MicrosoftXbox-360
-
-
-
-
+
-
-,+
-
+
+
+
+
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
Case Study: CrocsCase Study: Crocs
• Innovation in the shoe industry
• unique lightweight clogs that
combine comfort and fashion and
low price point.
• Crocs branded shoes have broad
appeal because they are a funalternative to traditional sandals
and casual shoes and come in a
wide range of funky bright colors.
• Customer Value: ergonomic
comfort, lightweight, anti-skid,
waterproof, and anti-microbial.
-Fun (emotional)
-New Type of
Fashionable,
Functional Casual
Footwear
-Comfort (Lightweight
and loose fitting)
-Ease of Use
-Durability
-Safety (Skid resistant)
-Purchase
Accessibility
CREATERAISE
-Labor Manufacturing
Costs
-Material Costs
-Advertising Costs
-Shoe Box and
packaging
REDUCEELIMINATE
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
Case Study: BlackberryCase Study: Blackberry
• Blackberry was a breakthrough in
mobile communication
• Was ideal for Corporate People
“On-the-Go” and must be reached
anywhere (airports, etc.)
• Rapid Response Time to Emails
• Eliminated need for Laptop and wifi
connection to check email /
Browse / Chat-Security
-”Push Technology”
-Redundancy of Email
/ Synchronization
-QWERT Keyboard
-Real Time Chat
Capability
-Battery Life
-Durability (Bulletproof
Material)
-Reliability
-Speed of
send/receive email
-Browsing Capability
-integration of voice,
PDA, Tools, Email
CREATERAISE
-implementation time
-training time
-support time
-response time to
emails (Global)
-Need for computer to
check email
-Need for wifi to
connect
-remote client software
instalation
REDUCEELIMINATE
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
Case Study: Case Study: InfinitInfinit
• Infinit is a RTD, non-carbonated
cocktail with 5% Alcohol
• Comes in 6 flavors using GSMI’sGran Matador Brandy, Tondena Rum 8 Years,
Antonov Vodka, GSM Blue, Don Enrique, St. George
Premium Whisky
• Shifted Customers from 4 F’s:
Farmers,Fishermen,Foremen,Factor
y Workers to 20-30 age Club Goers
• Battle Cries: “Bilog ang Mundo”
“Tapangan Mo Pa!”, “Blue Ocean”-Variety of Flavors
-Fun and Emotional
Appeal
-Reinvented Itself
-New Markets
-”Refreshing” drink
-sleek bottle shape
(same as SML &
Strong Ice)
-Alcohol
-Availability
(Bars, Groceries,
Convenience Stores)
CREATERAISE
-Price vs. Imported
RTD Alcopops (Vodka
Ice, Vodka Cruiser)
=Only P30 in bars
-Advertising Cost
(mostly Point of
Purchase Collaterals)
-Hassle of Mixing
-Strong Alcohol Taste
(Masked by Fruit)
-4 F’s image
REDUCEELIMINATE
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
Case Study: NETPIACase Study: NETPIA
• NETPIA tapped a new market,
enabling higher internet access to
a wider strata
• Eliminated the Digital Divide
between English / Non-English
Speaking Countries
• Created 3rd Generation Internet
(being implemented now in
various countries)
-A new demand for
Multi-Lingual
-Multi-Lingual Key
Word Address System
-3rd Generation
Internet
-A new venue for E-
Commerce (Look-up
Services)
-Accessibility to the
internet
-Protection of
Trademark and IP
-Ease of Use
-Comfort
-Nationalism
CREATERAISE
-Hassle of complicated
Domain addresses
-Pricing for registration
-Digital Divide
-Need to Learn
English
REDUCEELIMINATE
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
IP Address
Ex) http://211.106.67.202
English Domain Name
ASCII.ASCII format
Ex) http://www.netpia.com
Internationalized Domain Name (IDN)
IDN.ASCII format
Ex) www. .com
1st Generation
2nd Generation
2.5 Generation
3rd Generation
Next Generation
Internet address
Simplicity
Convenience
2.7 GenerationInternationalized TLD -2009
IDN.IDN format
Ex) www. .
Native Language Internet Name
Ex) (((( , DEFGHIس , , , , トヨタトヨタトヨタトヨタ))))
Evolution of the Internet NameEvolution of the Internet Name
Author: R.Nepomuceno Blue Ocean Strategy_RBN_v1
What if the World Could Communicate Better?...What if the World Could Communicate Better?...
What if you could use simple Keywords in yourWhat if you could use simple Keywords in yourWhat if you could use simple Keywords in yourWhat if you could use simple Keywords in yourWhat if you could use simple Keywords in yourWhat if you could use simple Keywords in yourWhat if you could use simple Keywords in yourWhat if you could use simple Keywords in yourNative Language?...Native Language?...Native Language?...Native Language?...Native Language?...Native Language?...Native Language?...Native Language?...
This FUTURE is possible NOW withThis FUTURE is possible NOW withThis FUTURE is possible NOW withThis FUTURE is possible NOW withThis FUTURE is possible NOW withThis FUTURE is possible NOW withThis FUTURE is possible NOW withThis FUTURE is possible NOW with NetpiaNetpiaNetpiaNetpiaNetpiaNetpiaNetpiaNetpia
Simplicity is Key to 3Simplicity is Key to 3Simplicity is Key to 3Simplicity is Key to 3Simplicity is Key to 3Simplicity is Key to 3Simplicity is Key to 3Simplicity is Key to 3rdrdrdrdrdrdrdrd Generation InternetGeneration InternetGeneration InternetGeneration InternetGeneration InternetGeneration InternetGeneration InternetGeneration Internet……