That’s the question Jonathon Zetterholm from Asheville, NC recently asked on twitter. And, I thought it was such a good question, it merited an answer that went beyond the confines of 140 characters.
It’s the concept of Red Ocean versus Blue Ocean.
It’s easier to go into an existing market, where you know there is demand for the best solution, then work to stake your claim. To carve up the existing pie differently and to be good enough to take your slice by pulling it out of the hands of others. Because, one of the biggest hurdles has been cleared, proof of demand.
You know a market exists, you’ve just got to figure out how to own it. That’s called a Red Ocean strategy, because, well, there’s blood in the water when you do that, it’s a zero sum game. You win by competing, so someone else loses. It’s the way most business is done.
The other approach is to take a much bigger leap of faith and create something that’s completely unproven, but if it works, will not just give you a slice of the current pie, it will either expand the existing pie or create an entirely new one. This is called Blue OCean strategy, you’re literally creating an entire new ocean to swim in. Competition becomes a non-issue, at least in the near term, because you’re playing on a field that you discovered or created and everyone else is still wandering around the old one.
Psychologically, it’s a tough thing to do. To get people to buy into something that’s far less proven than “we can do what they’re doing but better.” And, the educational burden that comes along with creating a Blue Ocean can be huge, both internally and with your potential market. But…BUT…if you pull it off, you will very likely own your market for a long time to come and have the opportunity to solve and delight (and generate revenue) on an entirely different level.
If you really want to dive into this, check out the fabulous book – Blue Ocean Strategy
What do you guys think?
Have you experienced any or all of these approaches?
What’s your chosen approach?
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