There is a lot written about red oceans, blue oceans, and market creation.
I’ve read about the many different philosophies. The Blue Ocean Strategy folks are talking about creating open spaces for you and your organization.
But someone like Anthony Iannarino talks about never winning business from anything but a red ocean.
Is one right and one wrong?
Are both wrong?
Are both right?
I’d put this down as both of them are right in their own way.
To me the key to understanding and creating market opportunities has revolved around 3 concepts:
No matter what market you think you are entering or want to enter, the key is always going to be to understand yourself and the unique value you are trying to create.
Sometimes this means that you are going to be creating a new market from something that is just coming to the market: think about when a new platform or tool comes online and you are the first to be able to summarize and teach people how to use that new tool or technology.
At the start, that’s a blue ocean…over time it might become a red ocean.
But no matter what, it starts with your value proposition and understanding how and what you deliver that is valuable.
Figure out who really is buying and what they will really pay:
One of the challenges in our economy today is that we’ve driven ourselves nuts trying to sell our products and services without really selling them.
Here’s our “freemium” model…which sometimes works and sometimes doesn’t.
How about when services like Blue Apron or Uber come to market and they market new ways of engaging with old ideas or needs but they acquire customers at extremely high prices while also charging unsustainable prices for what they are offering.
This is a model for long-term success because we’ve seen it over and over again when you hook someone on a lower than realistic price, that doesn’t typically mean that the consumer is going to trade up the line to the more realistic price later…typically, they just turn somewhere else.
That’s why when thinking through the process of creating a market for you and your business, you have to consider who your buyer is, who your ideal buyer is, and what they will pay.
Once you have recognized these factors, you can make a decision about whether or not you should go forward with your business.
Because maybe the price someone is willing to pay isn’t profitable for you and not sustainable.
Creating a market where you are losing money on every sale and making it up on volume isn’t a really strong business model.
Be willing and able to get your message in front of the right people:
There is this really poor idea that floats around about “build a better mousetrap” and blah, blah, blah.
That doesn’t work.
If you build a better mousetrap and don’t tell anyone, you have a better mousetrap.
You have to be willing to market and sell what you are offering.
How do you do that?
Again, we’ve been talking about it throughout, but:
- Understand your unique value
- Understand who your real buyer is and what they are willing to pay
- Find them in the places they are likely to be reached and persuaded
You have to do this consistently or it doesn’t matter.
Is there a magic formula for your marketing mix?
No. There isn’t a magic formula, but what will happen is that as you become more comfortable getting in front of people and sharing your value, you’ll find things that work better than most.
Back to the original idea, do you need a red ocean to succeed or a blue ocean?
Depends…either might work depending on the situation. But what you really need is to understand your business, your buyer, and how you can put those two together.