Blue Ocean Strategy

Blue Ocean Strategy is a business framework developed by W. Chan Kim and Renée Mauborgne that emphasizes creating uncontested market space and making competition irrelevant by focusing on innovation and differentiation. Unlike traditional strategies that focus on competing within existing market boundaries (red oceans), Blue Ocean Strategy advocates for exploring new market spaces (blue oceans) where competition is limited or nonexistent. By innovating and offering unique value propositions, businesses can attract new customers and achieve sustainable growth.


  1. Red Oceans vs. Blue Oceans: Red oceans represent existing market spaces where competition is intense, and businesses compete for the same customers, often resulting in price wars and commoditization. In contrast, blue oceans denote new, untapped market spaces characterized by innovation, differentiation, and value creation. Blue Ocean Strategy encourages businesses to shift their focus from competing in overcrowded red oceans to exploring new market opportunities in blue oceans.
  2. Value Innovation: Value innovation lies at the heart of Blue Ocean Strategy. Instead of choosing between differentiation and low cost, businesses seek to create new value for customers while simultaneously reducing costs. By offering unique value propositions that address unmet customer needs or pain points, businesses can unlock new demand and attract non-customers.
  3. Six Paths Framework: The Six Paths Framework provides a systematic approach for identifying blue ocean opportunities by challenging industry assumptions and exploring alternative market spaces. These paths include looking across alternative industries, strategic groups, buyer groups, complementary product and service offerings, functional or emotional appeal, and time.
  4. Four Actions Framework: The Four Actions Framework guides businesses in creating blue ocean strategies by challenging industry norms and redefining key factors of competition. This framework involves identifying which factors should be eliminated, reduced, raised, or created to differentiate the business from competitors and unlock new value for customers.


Small business owners can apply Blue Ocean Strategy principles in the following ways:

  • Market Segmentation: Identify underserved or overlooked customer segments with unique needs or preferences that can be addressed through innovative solutions.
  • Value Proposition Design: Develop compelling value propositions that differentiate the business from competitors and create new demand among non-customers.
  • Product or Service Innovation: Innovate products or services to offer features, benefits, or experiences that set the business apart and provide superior value to customers.
  • Business Model Innovation: Explore new business models, distribution channels, or revenue streams that disrupt industry norms and create new market opportunities.
  • Marketing and Branding: Communicate the unique value proposition effectively through branding, messaging, and marketing strategies that resonate with target audiences and differentiate the business in the marketplace.


Blue Ocean Strategy offers small business owners a powerful framework for driving innovation, differentiation, and growth by creating uncontested market space. By shifting their focus from competing within existing market boundaries to exploring new market opportunities, businesses can unlock new sources of value, attract non-customers, and achieve sustainable success. Through value innovation, strategic thinking, and a commitment to challenging industry norms, small businesses can chart their course in blue oceans and redefine their industries’ competitive landscape.