Sublime

change from “Do everything” or “Do what we do well” to “Do what matters to the customer” and “Do what you are best at.” Outsource the rest, or find business partners to provide it with you.

They began with that strategy from day one: All successful low-price companies focused on low prices and high volumes from the very beginning. In many cases, they created radically new business model

First, you want to understand your customers' overall WTP for your product—the price range they would consider reasonable (if, in fact, they would pay anything at all). Then you have to ask yourself whether that price range would work for your company. It may not if you can't deliver a market-acceptable product at a price that makes you a profit.

The third test of strategy may well be the hardest. Making trade-offs means accepting limits—saying no to some customers, for example, so that you can better serve others. Trade-offs arise when choices are incompatible. Because a successful strategy will attract imitators, choices that are difficult to copy are essential.

Competition-based red ocean strategy assumes that an industry’s structural conditions are given and that firms are forced to compete within them, an assumption based on what the academics call the structuralist view, or environmental determinism.

Cirque du Soleil, Southwest Airlines, Curves, Under Armour, Tesla, and the Nintendo Wii are all clear blue ocean plays. They were new, wildly different from anything else in their industry, and as a result grew rapidly. They were just so inherently exciting and fresh. They broke new ground and then owned it, in some cases for decades before the

It is conventionally believed that companies can either create greater value to customers at a higher cost or create reasonable value at a lower cost. Here strategy is seen as making a choice between differentiation and low cost.21 In contrast, those that seek to create blue oceans pursue differentiation and low cost simultaneously.

Blue oceans, in contrast, are defined by untapped market space, demand creation, and the opportunity for highly profitable growth. Although some blue oceans are created well beyond existing industry boundaries, most are created from within red oceans by expanding existing industry boundaries, as Cirque du Soleil did. In blue oceans, competition is

Successful companies differentiate themselves by adding real value for their customers. Helping customers see the real value you bring marks the difference between high and low profits. The question is “What is real value from the customer's perspective?”