Blue Ocean Strategies
February 2, 2015
Strategy and Positiong Paper for StressLess: A Fitbit Product
What is innovation? By definition, it is a new method, or idea that revolutionizes the current standard. Innovation is paramount to success in a competitive market. A company can choose innovation in the current market, or use a red ocean strategy. This strategy is to take a current product or process and improve upon it. Another option businesses have is to endeavor for a blue ocean strategy: the strategy of creating a new market.
A blue ocean strategy takes the market to a new level. A new product, or a new business is invented in a blue ocean strategy. Blue ocean strategies ...view middle of the document...
According to the Harvard Business Review, 86% of new business is red ocean movement. That is an overwhelming percentage. Red ocean strategies are fed by a need to compete with other companies; proving their superiority and ability to manipulate a market to their advantage. (Kim, Mauborgne, 2004)
Airbnb is a blue ocean move. Airbnb has taken travel and home rental and turned it into a brand new market. Airbnb is a new, online business that puts potential vacation rental customers in contact with homeowners who wish to rent out their homes on a temporary basis. Previously, travelers would stay in hotels or hostels during travel, perhaps occasionally renting out a home for a long-term stay. People who wished to rent their homes out were obligated to enter into contracts with property management companies that charged high commissions to rent out their home. Airbnb changed that. ("Vacation Rentals, Homes, Apartments & Rooms for Rent - Airbnb", 2015)
Airbnb is an online website that allows both homeowners and travelers to share their plans and enter into business agreements. Airbnb uses their website to facilitate financial transactions and provide a safe space for both parties to conduct business. Airbnb carved out a market, and voraciously committed to maintaining the upper hand in said market. While other companies, such as Vacationrentals.com, have since attempted to enter the now red ocean of Airbnb’s original blue, the success and branding have gone to Airbnb. Airbnb has revolutionized the travel industry; it...