Whether you are new in business or a seasoned entrepreneur, you will face a challenge with generating sales at some point.
Businesses spend millions of dollars fiercely looking for strategies that will ensure they stay ahead of their competitors.
But have you ever thought of making the market almost irrelevant because you are operating in an uncontested market place?
Not making sense right now?
Well it will soon enough...
Instead of struggling to survive in the bloody shark-infested “Red Oceans” of vicious competition, why not move to the “Blue Oceans” where there is little or no competition?
This idea is not about dividing markets but it’s about creating new frontiers of opportunity, growth, and jobs, where success is not about fighting for a bigger slice of an existing, often shrinking pie, but about creating a larger economic pie for all.
The bottom line here is that innovation is key.
A typical example of this concept is when the French Groupe SEB found success by leaving an intensely competitive market for conventional French fry makers. They created a French fry maker that operated without the hassle of heating large quantities of oil.
The Acti-Fry made healthier French fries with only one tablespoon of oil for two pounds of French fries.
This transformed the market for French fry makers.
Competing less and increasing profits involves market-creating innovation.
It opens up new possibilities that are not available to organizations operating within the existing cost-value structure.
It expands the universe as to what is possible, often enabling higher value at lower cost.
The key components to this strategy where you don’t have to compete as intensely include;
This is about expanding mental horizons and shifting understanding of where opportunity lies. Make the shift from doing 'what seems logical' to what is new and is not overly similar to what is currently out there.
This component involves using practical tools to systematically translate thoughts into commercially compelling new offerings.
To get this strategy right, business owners needs to exemplify a humanistic process which inspires people’s confidence to own and drive the process for effective execution.
Salesforce.com perfected this strategy.
They were able to change the customer-relationship management industry through providing services on a subscription basis through the cloud.
This innovative strategy made sure they focused on creating and capturing new markets, instead of fighting over existing customers.
Bottom line, they “think different.”
There is a five-step process for reproducing the strategy of competing less and increasing profits like salesforce.com. And these steps can be deployed in your business
The five steps are:
1. Choosing the right place to start and constructing the right team for the initiative.
2. Getting clear about the current state of play
3. Uncovering the hidden pain points that limit the current size of the industry and discovering an ocean of non-customers.
4. Systematically reconstructing market boundaries and developing alternative opportunities.
5. Selecting the right innovative move, conducting rapid market tests, finalizing, and launching the shift.
