Renewal: The Dynamic Process
Chapter 10 addresses how long blue oceans last and when to create new ones.
Barriers to Imitation:
Barrier TypeHow It WorksExampleAlignmentAll three propositions working together is hard to replicateComic Relief's ecosystemCognitive/OrganizationalNew strategy doesn't make sense to competitors; requires major changesCNN's 24/7 news mocked as "Chicken Noodle News"BrandImitating contradicts current business modelBody Shop's no-beauty-promises approachEconomic/LegalNatural monopoly, scale economies, network effects, patentsKinepolis megaplex in Brussels (market supports only one)
When to Renew: Monitor your value curve. When it converges with competitors’, it’s time to create another blue ocean.
Pioneer-Migrator-Settler Map:
PIONEERS (Value Innovations)
↓ Over time, as imitation begins
MIGRATORS (Improved Value)
↓ Eventually become
SETTLERS (Me-too businesses)Healthy portfolio: Balance pioneers (future growth) with migrators and settlers (current cash flow).
Apple’s Renewal Journey:
1998: iMac (pioneer) → simplified Mac product line 2001: iPod (pioneer) → as iMac becomes migrator 2003: iTunes Store → strengthens iPod ocean 2007: iPhone (pioneer) → as iPod becomes migrator 2010: iPad (pioneer) → as iPhone becomes migrator
Each blue ocean gave Apple years of dominance before needing renewal.
Critique: The renewal discussion is valuable but treats blue ocean creation as repeatable on demand. The reality? Most companies struggle to create even one blue ocean in their lifetime. Apple is exceptional, not typical. The book needs more realistic expectations and guidance for companies that aren’t Apple.
The Red Ocean Traps: What Not to Do
The expanded edition’s final chapter addresses ten misconceptions that keep companies stuck in red oceans:
Ten Red Ocean Traps:
- Customer-oriented trap: Focusing on existing customers rather than noncustomers
- Beyond core trap: Believing you must venture outside your industry
- Technology trap: Confusing technology innovation with value innovation
- First-mover trap: Thinking you must be first to market
- Differentiation trap: Seeing blue ocean as synonymous with differentiation strategy
- Low-cost trap: Confusing blue ocean with cost leadership
- Innovation trap: Equating any innovation with value innovation
- Marketing/niche trap: Treating blue ocean as marketing theory or niche strategy
- Competition trap: Thinking competition is always good or always bad
- Disruption trap: Believing blue ocean equals creative destruction
Most Important Trap to Avoid: The differentiation trap. Blue ocean is NOT about choosing differentiation over low cost. It’s about pursuing BOTH simultaneously through value innovation.
Weakest Trap Discussion: The “beyond core” trap. While the authors claim most blue oceans come from within existing industries, their own examples show a mix. Cirque du Soleil certainly reconstructed circus and theater boundaries. The guidance on when to look within versus beyond remains murky.