10

RED OCEAN TRAPS

and how you should avoid them.

A guide to those pursuing

Blue Ocean strategies for
business or product growth

© Harvard Business School Publishing Corporation

TRAP #01
It’s customer-led and
customer-oriented.

When you are increasingly

focused on making your existing
customers happier, you miss out on
opportunities to create new demands.

Focus on these 3 non-customers …

the 1) soon-to-be, 2) refusing and 3)
unexplored customers.

Non-customers, not customers, hold

the greatest insight into an industry’s
pain-points and points of intimidation
that limit the size and boundary of the
industry.
TRAP #02
Go beyond your core
business.

Much like the pursuit of happiness,

the pursuit of excellence can start from
within. Venturing outside of your core
strengths come with a risk factor and
can elevate you to success as well.

But very few manage to get there.

And a majority, often fail.

Keep an eye-out for knowledge, skills

and competencies that overlap.

Build on these to supplement and

complement your core strengths. Look
at Marvel, Netflix, Zerodha and Zoho.
TRAP #03
It’s about
New Technologies.

As long as your products and

services are simple, easy-to-use,
fun and productive … buyers will
fall in love with them.

When you are highly reliant on

technology, emphasize on its value.
Your customer experience should not
demand technology-savviness.

Value innovation, not technology

innovation, is what opens up
commercially compelling new markets
and gives you a competitive edge.
TRAP #04
You should be the
first-to-market.

You don’t have to be

the first to market. You
have to get it right the first time
by linking innovation to value.

If you are focused on being first-to-

market, you prioritize speed over
value. While speed will help you get
there soon, value is what will help
you stay and succeed.

In the race to get ahead of the rest,

do not compromise on your
customer value proposition.
TRAP #05
It’s the same as your
Differentiation Strategy.

In a competitive strategy, you

achieve Differentiation by providing
premium value and commanding
higher price.

Differentiation hence is a value-cost-

trade-off. Blue Ocean is about breaking
this trade-off, and focusing on value
innovation that makes the competition
irrelevant.

It’s about both value and cost, not

either/or.
TRAP #06
Create a low-cost strategy
with low-pricing.

Price your product or service

not against your competition, but
against substitutes and alternatives who
are taking away your non-customers.

It’s not about low-pricing. It’s about

strategic pricing.

Don’t focus on what to eliminate or

reduce to bring down the price.

Focus instead on what to create and

reuse to differentiate and stand out.
TRAP #07
It’s the same as your
Innovation Strategy.

As Motorola learned through

Iridium, a breakthrough in technology
(innovation) is not necessarily a
breakthrough in value that can attract
mass buyers.

If you are innovating, you need a

strategy that can align your people
towards a shared vision of value
creation and profit maximization.

Again, Value Innovation is the key to a

successfully blue ocean strategy.
TRAP #08
It’s a Marketing and
Niche Strategy.

While Marketing places

greater emphasis on niche customer
segments, you should focus on key
commonalities across diverse
segments to capture large demand.

Marketing strategies may be time-

bound and restricted to geographies.
While doing so, do not loose sight on
the holistic approach to create a
sustainable high-performance
strategy with value, profit and people
propositions.
TRAP #09
Your belief that the
Competition is Bad.

Your competition can be

good too. They help you
up-the-ante and push yourself to
out-perform. At times, you may
out-perform yourself and discover
new strengths.

Focus instead to go beyond competition

by opening new market spaces and
making the competition insignificant.

Redefine your industry boundaries,

renew growth strategies and create
new demand.
TRAP #10
It’s the same as Creative
Destruction or Disruption.

Digital Photography displaced

the Photographic Film.

Disruption, hence, resonates with

Schumpeter’s concept of creative
destruction, where the old is destroyed /
replaced by the new.

Focus on Non-Destruction or
Reconstruction. Redefine the problem.

Create new demand or an offering that

often complements rather than displaces
existing products and services.
Disclaimer
This document is adapted from the expanded edition
of the International Best Seller - Blue Ocean Strategy,
written by W Chan Kim and Renee Mauborgne; and
published by Harvard Business Review Press.

Buy the Book here :

https://store.hbr.org/product/blue-ocean-strategy-
expanded-edition-how-to-create-uncontested-
market-space-and-make-the-competition-
irrelevant/13892

© Harvard Business School Publishing Corporation

Icons from The Noun Project | Md Saiful Alam Saif, Ian Savage Design,
Vectors Point, Adrien Coquet, S Madsen, Gregor Cresnar, Angelo
Troiano, IGraphics, Gung Yoga

Compiled by Pradeep Kallayil for

the community of Business and
Product Leaders and Strategists
who pursue the path to creating
moats and strive for growth.

https://in.linkedin.com/in/kallayil