finding blue oceans - lippman connects · finding blue oceans in the exhibition and convention...

Finding Blue Oceans Finding Blue Oceans ggin the Exhibition and Convention Industryin the Exhibition and Convention Industry

Dr. Roch ParayreDr. Roch ParayreDecision Strategies InternationalDecision Strategies InternationalDecision Strategies InternationalDecision Strategies International

Blue Ocean Strategy –Searching for Uncontested Market SpaceBlue Ocean Strategy –Searching for Uncontested Market SpaceSearching for Uncontested Market SpaceSearching for Uncontested Market Space

Industry A

Industry B Industry CIndustry B Industry C

Copyright © 2010 Blue Ocean Strategy Network

What Do These Companies Have In Common?What Do These Companies Have In Common?What Do These Companies Have In Common?What Do These Companies Have In Common?

•• SwatchSwatch

•• Formula One Hotel Chain (Formula One Hotel Chain (FormuleFormule 1, Accor)1, Accor)

•• Home DepotHome Depot

•• Bloomberg Financial NewsBloomberg Financial News

•• Ralph LaurenRalph Laurenpp

•• Starbucks CoffeeStarbucks Coffee

•• Southwest AirlinesSouthwest AirlinesSouthwest AirlinesSouthwest Airlines

•• Nintendo Nintendo WiiWii


The Basic Premise Behind Blue Ocean StrategyThe Basic Premise Behind Blue Ocean Strategy

Blue Ocean Strategy is about:

The Basic Premise Behind Blue Ocean StrategyThe Basic Premise Behind Blue Ocean Strategy

Blue Ocean Strategy is about:Pushing for a quantum leap in buyer valueg q p y

While:

Pushing for a sharp drop in thePushing for a sharp drop in the industry’s cost structure.


The Blue Ocean Strategy ConceptThe Blue Ocean Strategy ConceptThe Blue Ocean Strategy ConceptThe Blue Ocean Strategy ConceptThe Simultaneous Pursuit of Radically Superior Value and Low Cost

What elements should be eliminated that our industry takes for granted?

Cost savings from eliminating & reducingCosts

Cost advantages from

What elements should be reduced well below the industry standard?

Bl Cost advantages from high volume

What elements should be raised well above the industry standard?

BlueOcean

Strategy

Superior value by raising & creatingWhat elements should

be created that the industry has never

ff d?Buyer value

offered?


Substantially Higher Returns from Investments in Blue OceansSubstantially Higher Returns from Investments in Blue OceansInvestments in Blue OceansInvestments in Blue Oceans

Business Launch

Revenue Impact

Profit Impact

Red OceansMarket-Competing Business Launches

Blue OceansMarket-Creating Business Launches


Beyond Products –Ten Focal Areas for InnovationBeyond Products –Ten Focal Areas for Innovation

2 Networking

1. Business modelhow your enterprise makes money

6 Product system

5. Product/Service performancewhat you sell and how it performs

Ten Focal Areas for InnovationTen Focal Areas for Innovation

2. Networkingwhat external partnerships you establish

6. Product systemhow you add value beyond standalone products

7. Servicehow you service your customers and citizens

Business model

FinanceNetworking Core

process

ProcessEnabling process

3 Enabling process

Channel

DeliveryBrand Customer

experienceProduct performance

OfferingProduct system

Service

3. Enabling processhow you support your core processes and workers

4 Core process

8. Channelwhat channels you use to interact with your customers

9. Brandwhat your brand signifies or promises t t4. Core process

fundamental processes that add value to your offerings (e.g., manufacturing)

10. Customer experiencehow you create an overall experience for customers

to your customers

Source: 1/28/09 Web Lecture by Derrick Palmer of Intervista. “A framework for strategic innovation”

Big “S” StrategyBig “S” StrategyBig S StrategyBig S Strategy

[ tilit[ tilit i ]i ] V l I tiV l I ti[utility [utility –– price] price] –– Value InnovationValue InnovationMarketing strategy

[price – cost] – Cost InnovationOperational strategy

[strategy implementation] – Organizational InnovationHR strategygy

Blue Ocean Strategy requires alignment between all three


Red Ocean Versus Blue Ocean StrategyRed Ocean Versus Blue Ocean Strategy

Bl O St tR d O St t

Red Ocean Versus Blue Ocean StrategyRed Ocean Versus Blue Ocean Strategy

Create uncontested market space

Blue Ocean StrategyRed Ocean Strategy

Compete in existing market space pg

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


Cirque du Soleil: Rebirth of the CircusCirque du Soleil: Rebirth of the CircusCirque du Soleil: Rebirth of the CircusCirque du Soleil: Rebirth of the Circus


Annual Revenues:Feld Entertainment vs. Cirque du SoleilAnnual Revenues:Feld Entertainment vs. Cirque du SoleilFeld Entertainment vs. Cirque du SoleilFeld Entertainment vs. Cirque du Soleil

700Cirque du SoleilFeld Entertainment

500

600

300

400

100

200

01995 1996 1997 1998 1999 2000 2001 2002 2003 2004


Value Curve for Cirque du SoleilValue Curve for Cirque du SoleilValue Curve for Cirque du SoleilValue Curve for Cirque du Soleil


Value Curve for Opera or TheaterValue Curve for Opera or TheaterValue Curve for Opera or TheaterValue Curve for Opera or Theater


Learning from the Cirque du Soleil ExperienceLearning from the Cirque du Soleil Experiencefrom the Cirque du Soleil Experiencefrom the Cirque du Soleil Experience

•• Management is often too focused Management is often too focused on Industry Perceptions and on Industry Perceptions and C titi th th thC titi th th thCompetition, rather than on the Competition, rather than on the exploration of customer [utility] exploration of customer [utility] value.value.

•• Escaping this logic is mostly Escaping this logic is mostly against the rules of core businessagainst the rules of core businessagainst the rules of core business against the rules of core business and competence.and competence.

•• Insisting on the conventional Insisting on the conventional beliefs handicaps the design of beliefs handicaps the design of compelling value(s).compelling value(s). ?


Today’s ChallengesToday’s Challengesoday s C a e gesoday s C a e ges•• Consolidation of customersConsolidation of customers

•• EconomyEconomy

•• Cost of show services (inc transportation)Cost of show services (inc transportation)Cost of show services (inc. transportation)Cost of show services (inc. transportation)

•• Travel and rooming costsTravel and rooming costs

•• Time commitment or staff requiredTime commitment or staff required

•• Young “wired” workersYoung “wired” workersgg

Potential Value ElementsPotential Value Elementsote t a a ue e e tsote t a a ue e e tsPotential Value Elements: Exhibitor AttendeeSee existing suppliers/customers x xSee new suppliers/customers x xSee full product lines xSee full product lines xCompare products side by side xTalk to somebody like me/not a competitor x x"Be seen" - networking x xEducation & offsite events xFun: party/location xp yMetrics/ROI xCost structure xEasy: vendor packages xAbility to control/influence show xLives: repackage material xTime commitment x xTime commitment x xPartners/co-located events (annual meetings) x xExtras: RFID tracking xExtras: VIP lounges or processes xShowcase industry for wall street or white house x xPromotion for show xShow's track record (with your target audience) xKnow who is coming x xMarket leading show x xWhat the show supports (goes back into association/industry) x xHelp with maximizing show (increase ROI) x xOpportunities for lead retrieval xOpportunities for lead retrieval xSponsorship opportunities xFresh content or format x xAbility to connect buyer/seller pre& post show x x

Alternatives & Options for Exhibitors and AttendeesAlternatives & Options for Exhibitors and Attendeesfor Exhibitors and Attendeesfor Exhibitors and Attendees

•• Do nothingDo nothing

•• Traditional marketingTraditional marketing

•• Online advertising/social mediaOnline advertising/social media

•• Visit customersVisit customers

•• Regional showsRegional showsRegional showsRegional shows

•• Corporate eventsCorporate events

•• International eventsInternational events

•• Virtual showsVirtual shows

•• Competitive showsCompetitive shows

Value Curves for AlternativesValue Curves for Alternativesa ue Cu es o te at esa ue Cu es o te at es

Introduction to Six Paths AnalysisIntroduction to Six Paths Analysist oduct o to S at s a ys st oduct o to S at s a ys s

AcrossF ti lFunctional or

EmotionalAppeal

AAcross AcrossChain of Buyers

AcrossSubstituteIndustries Past

DemandSupply

AcrossComplementary

Offerings

AcrossStrategicG

Future

DemandSupply

AcrossTime

& Trends

OfferingsGroups


& Trends

Where Did The Value Curve for Quicken Come From?Where Did The Value Curve for Quicken Come From?Quicken Come From?Quicken Come From?High

ng L

evel

Personal Financial Software

tive

Offe

rin

Low

Rel

at Intuit’s Quicken

Price Easeof Use

OptionalFeatures

Speedof Handling

Accuracyof Handling

The Pencil

Key elements of product, service, and delivery


Where Did the Value Curve of Formule 1 Come From?Where Did the Value Curve of Formule 1 Come From?Formule 1 Come From?Formule 1 Come From?

erin

g Le

vel

2 Star

elat

ive

Offe

1 Star

Re

F 1



Where Did the Bloomberg Value Curve Come From?Where Did the Bloomberg Value Curve Come From?Curve Come From?Curve Come From?

vel

erin

g Le

v

Bloomberg’s

ativ

e O

ffe Value Curve

Rel

a

Key elements of product service and delivery

Coverage ofNews

Terminal Ease-of-use

Coverage of Price Quotes

Price On-line Analytics

Lifestyle Information

Historical Price Data



Where Did the Barnes & Noble Value Curve Come From?Where Did the Barnes & Noble Value Curve Come From?Value Curve Come From?Value Curve Come From?

ng L

evel

ve O

fferin

Barnes and

Rel

ativ


Price Knowledgeable Staff

Selection of Books

Store Hours Café and Lounge Area

Noble

Store Ambience


Where Did the Value Curve For the Original Body Shop Come From?Where Did the Value Curve For the Original Body Shop Come From?

lOriginal Body Shop Come From?Original Body Shop Come From?

ring

Leve

ltiv

e O

ffer

Rel

at



Where Did the Value Curve ForSouthwest Airlines Come From?Where Did the Value Curve ForSouthwest Airlines Come From?Southwest Airlines Come From?Southwest Airlines Come From?

High

l

Traditional airline, e.g. United

erin

g Le

vel

elat

ive

Offe

Low

Re Southwest

Airlines

Ability to choose class

of service

Quality of food

Ability to cover long distances

Picks up and delivers

passengers close to their

point of origin or

destination

Guaranteed reservations and

seats

Quality of in-flight

service, Fun

Quality of frequent

flier programs

Luggage handling

Reliability,On-time arrivals

Price


Key Elements of Product, Service and Delivery

Pursuing Blue Ocean Strategy: The Six Paths FrameworkPursuing Blue Ocean Strategy: The Six Paths FrameworkThe Six Paths FrameworkThe Six Paths Framework

AcrossFunctional or

The strategic Six Paths Framework provides a structured process for finding new value curves.

EmotionalAppeal

AcrossChain of

AcrossSubstituteIndustries

ReduceBuyersIndustries

New Value CreateEliminate

AcrossAcross

Value Curve

CreateEliminate

AcrossTime

AcrossComplementary

OfferingsStrategicGroups

Raise


Time & Trends

Who Can You Learn From?Who Can You Learn From?o Ca ou ea oo Ca ou ea oBusiness Type Elements to Emulate

TV M sic or Mo ie B siness Prod ce once distrib te all earTV, Music, or Movie Business Produce once, distribute all year

Concierge or Personal Shopper Connect in the right way

Retail Present well and encourageimpulse purchase

Digital & Online Marketers Grab marketing spend from print

Show Industry in Asia & Europe Turn key solutions for exhibitors

Casino Whales

Value Elements from TV & MoviesValue Elements from TV & Moviesa ue e e ts o & o esa ue e e ts o & o esProduce Once, Distribute ForeverProduce Once, Distribute Forever•• Multiple formats (live, DVD, Multiple formats (live, DVD, huluhulu, on demand, re, on demand, re--runs, etc.)runs, etc.)

•• Comfortable & familiar format (know what will happen when you Comfortable & familiar format (know what will happen when you turn the TV on)turn the TV on)turn the TV on)turn the TV on)

•• Always on (can usually find “your show”)Always on (can usually find “your show”)

•• Emotional attachment to content (“my show”)Emotional attachment to content (“my show”)

•• License content/characters (product endorsements, spinLicense content/characters (product endorsements, spin--offs, offs, etc.)etc.)etc.)etc.)

•• Engage me: Books, mugs, fan sites, eventsEngage me: Books, mugs, fan sites, events

•• Social media strategy (House MD quiz onSocial media strategy (House MD quiz on FacebookFacebook))•• Social media strategy (House MD quiz on Social media strategy (House MD quiz on FacebookFacebook))

Value Elements from ConciergeValue Elements from Conciergea ue e e ts o Co c e gea ue e e ts o Co c e geConnecting in the Right WayConnecting in the Right Way

•• “Free” (comes with standard hotel amenities)“Free” (comes with standard hotel amenities)

•• Easy to find (right by the door)Easy to find (right by the door)Easy to find (right by the door)Easy to find (right by the door)

•• Can pull strings/gain accessCan pull strings/gain access

•• Makes me feel importantMakes me feel important

•• Make it easy/makes it happenMake it easy/makes it happeny ppy pp

•• Knows inside scoop (education)Knows inside scoop (education)

Value Elements from RetailValue Elements from Retaila ue e e ts o etaa ue e e ts o etaPresent Well and Encourage Impulse PurchasePresent Well and Encourage Impulse Purchase

•• Fresh and inviting (clean, bright, etc.)Fresh and inviting (clean, bright, etc.)

•• Can find what I needCan find what I needCan find what I needCan find what I need

•• Promotions & salesPromotions & sales

•• Salespeople (or someone to help me)Salespeople (or someone to help me)

•• Layout (“destination departments” make you Layout (“destination departments” make you y ( p yy ( p ywalk though other categories first)walk though other categories first)

Value Elements from Digital MediaValue Elements from Digital Mediaa ue e e ts o g ta ed aa ue e e ts o g ta ed aGrabbed Marketing Spend from PrintGrabbed Marketing Spend from Print

•• Customizable/PersonalizationCustomizable/Personalization

•• Fresh & changes oftenFresh & changes oftenFresh & changes oftenFresh & changes often

•• On demand (can access wherever/whenever)On demand (can access wherever/whenever)

•• Easy to shareEasy to share

•• Interactive (comment on blog, etc.)Interactive (comment on blog, etc.)( g, )( g, )

•• Less costly infrastructure (no printing press, Less costly infrastructure (no printing press, no paper no distribution network nono paper no distribution network nono paper, no distribution network, no no paper, no distribution network, no transportation costs, etc.)transportation costs, etc.)

Value Elements from NetflixValue Elements from Netflixa ue e e ts o eta ue e e ts o etSophisticated Content DeliverySophisticated Content Delivery

•• Suggestion engineSuggestion engine

•• On demand content (download movies)On demand content (download movies)On demand content (download movies)On demand content (download movies)

•• Physical content (Physical content (dvddvd in mail)in mail)

•• Easy (comes with prepaid envelope to return)Easy (comes with prepaid envelope to return)

•• Reviews (hear from “people like me”)Reviews (hear from “people like me”)( p p )( p p )

Example:Redrawing the Value CurveExample:Redrawing the Value Curveed a g t e a ue Cu eed a g t e a ue Cu e

This could be an online hub that combines the best content and elements from all industry shows, and makes available to attendees based on their preferences.

For Additional Information For Additional Information please get in touch with my colleagueplease get in touch with my colleague

Jacqueline ClaudiaJacqueline ClaudiaDecision Strategies InternationalDecision Strategies InternationalDecision Strategies InternationalDecision Strategies International

267267--972972--27152715l di @thi kd il di @thi kd [email protected]@thinkdsi.comwww.thinkdsi.comwww.thinkdsi.com

finding blue oceans - lippman connects · finding blue oceans in the exhibition and convention...

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