SMM20503 NEW ERA MANAGEMENT

INDIVIDUAL ASSIGNMENT

REPORT: BLUE OCEAN STRATEGY (Yellow Tail)

PREPARED FOR:

ENCIK MASKOR BAJURI

PREPARED BY:

NO NAME MATRIC NO GROUP CONTACT NUM

1 211420161 A 011-11401681
NURUL FARIHAH NABILA BINTI
NAZRI

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INTRODUCTION

Blue Ocean Strategy, created by W. Chan Kim and Renée Mauborgne, is a new way

of thinking, a new strategic mindset, and a daring new route to winning the future. It's

analytical and energising for everyone. It is about establishing new markets rather than

competing in pre-existing ones. It's all about value innovation, differentiating yourself by

increasing value for buyers while keeping expenses down. It is all about creating new

demand and rendering the competitors obsolete. Blue ocean represents all of the sectors that

do not exist now - the untapped and uncontaminated market area. It is broad, deep, and strong

- in terms of potential and lucrative growth - just like the 'blue' ocean.

Yellow Tail is an Australian brand developed in 2001 by the Casella family of Sicily,

who emigrated to New South Wales in 1957. In 1965, the family purchased vines, then in

1969, they purchased a winery. The family chose to develop a new brand, "Yellow Tail,"

with an original brand concept in 2001. Because the family vineyards did not have the same

reputation as those in Europe, the family could not claim to be targeting the same market of

wine aficionados. As a result, Casella opted not to compete with French or Italian wines on

quality, product complexity, or vineyard renown. Instead, they marketed their brand as

approachable and enjoyable, and they targeted a new sort of wine buyer.

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METHOD HAS BEEN USED

The blue ocean method promotes tinkering with your products in order to propel them

into their own market with cheap pricing and no competition. Kim and Mauborgne stated in

their academic work how Yellow Tail employed a "Blue Ocean Strategy," which consists of

avoiding an overcrowded market (a red ocean where all the sharks are battling each other)

and diving into a blue ocean where there is no opponent. The waters in question are

marketplaces, and demand is produced rather than fought over in blue oceans. So, how did

Yellow Tail begin swimming in the Blue Ocean? According to The Wine Economist, this is

due to the fact that it is a new form of product inside the wine business, rather than merely

wine. By utilising the four steps structure of the Blue Ocean Strategy, the organisation was

able to identify and respond to the demands of a unique and new market in the United States.

First and foremost, they determined to minimise which elements should be lowered

considerably below industry standards? Wine complexity, wine range, and vineyard

reputation are the three variables. Second, they chose to develop whatever factors should be

developed that the sector has never provided? The factors include easy drinking, variety, and

fun and adventure. Third, they resolved to elevate. Which criteria should be elevated well

beyond industry standards? Price versus budget wines and shop engagement are the

considerations. Last but not least, they made the decision to delete. Which of the variables on

which the industry has traditionally competed should be eliminated? Enological terms and

differences, ageing characteristics, and above-the-line marketing are the variables.

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POSITIVE AND NEGATIVE IMPACT USING BLUE OCEAN STRATEGY.

The positive impact using blue ocean strategy are, you stay away from oversaturated

markets. Your tiny firm must compete with multibillion-dollar multinationals and other large

players in your industry. However, if you use the blue ocean technique, your product will be

unique while still meeting client wants at a reasonable price. There will be no competition

from the powerful great names in your sector. Aside from that, it presents possibility for

growth. Going the blue ocean way entails balancing product or service innovation with cost

and usefulness in order to create new value for your consumers. Word-of-mouth advertising

may build demand as more people buy what you sell. Aside from that, you'll interact with

them on their level. Blue ocean thinking considers both value and affordability. You'll

constantly release new products at prices that your target market can afford. This method

minimises your audience's hurdles to purchasing what you have to offer.

For the negative impact are, it might be overly ambitious. The reasoning underlying

the blue ocean approach argues that any company may create a low-cost, no-competition

product or service. In truth, being this inventive is not always simple. Even if you have a

fantastic concept, real-world limits may prevent it from becoming a reality. Aside from that,

it may be too hazardous. Perhaps you've discovered a technique to create a fully unique

product without charging exorbitant prices. Perhaps you've arrived at this fork in the road

because individuals in your small company specialty would buy from you. But what if they

are the only folks who are interested in your products? If this is the case, the blue ocean

method may overburden you. Finally, it might be transient. Because innovations breed

imitators, a blue ocean can readily turn into a red ocean over time. Even though a blue ocean

approach seems excellent for your company right now, it may not be feasible in the long run.

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 CONCLUSION

Yellow Tail has figured out how to position itself in an underserved market sector by

producing value and distinguishing itself from well-established competitors. This is an

excellent example of a unique strategy that considers the demands of the consumer. Yellow

Tail became a market leader in the wine industry by establishing new business prospects; it

did not steal the market, but rather established a new one. The brand's success can be

attributed to a good use of promotional tool and product innovation, as well as other factors,

such as the fact that it remained a family affair, the company formed an alliance with a US

local wine supplier, and insisted on high-standard irrigation strategies in their vineyards.

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 REFERENCES

Chan Kim et.al (2004-2022), Blue Ocean, Red Ocean vs Blue Ocean Strategy.

https://www.blueoceanstrategy.com/tools/red-ocean-vs-blue-ocean-strategy/

Chan Kim et.al (2004-2022), Blue Ocean, 7 Powerful Blue Ocean Strategy Examples
That Left the Competition Behind.

https://www.blueoceanstrategy.com/blog/7-powerful-blue-ocean-strategy-examples/

Marion (2021), Yellow Tail: Clever Brand Positioning Within the American Wine
Industry.

https://www.thebrandingjournal.com/2014/05/yellow-tail-clever-product-positioning-
within-american-wine-industry

Max Freedman (2022), Blue Ocean Strategy: Creating Your Own Market. Instead of
viciously competing with other companies, find a way to work in a marketplace free of
competitors.

https://www.businessnewsdaily.com/5647-blue-ocean-strategy.html

Ukessays.com. The Essay Writing Experts (2021), Describe and Outline Types of
Management Approaches.

https://www.ukessays.com/essays/management/types-of-management-approaches-
management-essay.php

Yonderconsulting.com, 3 examples of blue ocean strategy

https://yonderconsulting.com/3-examples-blue-ocean-strategy/