Question

Define and give an example of a “blue ocean strategy” in a digital economy.

Answer 1

The Blue Ocean Strategy seeks to create a new environment for the industry and irrelevance competition. The Red Ocean plan, on the other hand, is all about rivalry. As the market is competitive, businesses are actively fighting for a higher proportion of restricted demand, a blue ocean eventually converts into red ocean.

The blue ocean strategy aims at differentiating the market and making it more competitive at a traditional market and generating additional demands at the same time. It is about creating and capturing undisputed market space , making uncontested market space.

One of the best example of blue ocean strategy in a digital economy is Netflix. Netflix creatively built a new market, avoided competing in the crowded ocean of film rental companies and rendered a new marketplace where no competition was present.

Netflix changed the industry by changing the way people rented movies, instead of focusing on the price or being a little bit better than other video rental providers. They first charged a monthly flat subscription fee, allowing people to keep the films as long as they wished. First they moved into the streaming business, next partnerships with Apple TV and Smart TV for apps that allow customers to register immediately and lately to create an intelligent algorithm based on suggestion.

Please don't forget to upvote the solution if it is helpful. Thank you.