Competition is a killer, says best-selling business author Renée Mauborgne.
That’s why companies must stop jousting with competitors and look for innovative ways to identify and exploit uncharted markets.
It’s an approach Mauborgne outlines in her book “Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant.” It was co-written with W. Chan Kim, a former business professor at the University of Michigan.
Mauborgne explained the nuances of her theory to about 250 business, nonprofit and government leaders this week in Denver as part of the monthly Executive Forum.
Too often, Mauborgne said, companies battle over existing markets, what she calls “red oceans,” instead of investing in undeveloped markets, or “blue oceans.”
She identified several “blue ocean” industries that barely existed 30 years ago, including mutual funds, biotechnology, discount retail and express mail delivery.
“The essence of the blue- ocean strategy is how to create and capture an uncontested marketplace where your competition doesn’t matter,” said Mauborgne, an American-born business professor based in Fontainebleu, France.
Mau borgne offered several examples to highlight the concept.
Cirque du Soleil: Instead of directly competing with Ringling Bros. and Barnum & Bailey, the Canadian company redefined the circus industry. It created a new market and a new audience by blending theater, opera and elements of a traditional circus.
Southwest Airlines: The company reinvented the short- haul airline industry by eliminating meals, lounges and seating-class choices, while delivering what consumers really wanted: frequent and flexible departures at low prices.
Other “blue oceans” include markets for the Sony Walkman, Apple’s iPod and Australian winemaker Yellow Tail, which appealed to novice wine drinkers by offering a simple product at a reasonable price.
Staff writer Will Shanley can be reached at 303-820-1260 or wshanley@denverpost.com.
