🌊 Red Ocean Strategy

Compete in an existing market space.

✅ Characteristics:

  • Industry is well-defined and crowded
  • Competition is fierce (a “bloody ocean” 🩸)
  • Companies fight for market share
  • Success = outperforming rivals
  • Focus on existing demand
  • Differentiation OR low cost (rarely both)

🔍 Example:

Fast food chains like McDonald’s vs Burger King. They sell similar products, compete on price, and location — all in the same market space.

🌊 Blue Ocean Strategy

Create a new, uncontested market space.

✅ Characteristics:

  • Focus on innovation & value creation
  • Make the competition irrelevant
  • Capture new demand
  • Break the value-cost trade-off
  • Create AND capture new market space

🔍 Example:

Cirque du Soleil redefined the circus experience by blending circus with theater — no animals, higher prices, artistic value — creating a new market.

FeatureRed OceanBlue Ocean
Market SpaceExistingNew / Uncontested
CompetitionBeat the competitionMake competition irrelevant
DemandExploit existing demandCreate new demand
FocusEither cost OR differentiationCost AND differentiation (value innovation)
Strategy GoalGain bigger slice of marketCreate a new market
Risk LevelCompetitive pressureInnovation risk, but high reward

The chart has boats in the colored sea. The Blue Ocean Strategy concept presentation is a vector infographic element of marketing. The red has bloody mass competition and the blue is a niche market.The chart has boats in the colored sea. The Blue Ocean Strategy concept presentation is a vector infographic element of marketing. The red has bloody mass competition and the blue is a niche market.
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