The Concept of the Red Ocean and Blue Ocean Marketing Strategy: the Business Paradigm - Research Paper Example

Moreover, it is important to understand the key theories underpinning blue ocean strategy, which has been spearheaded by the works of Chan Kim & Mauborgne (2005). The incoming of the second media age and multiple digital platforms have created new societal trends and business opportunities through the multimedia business model. Additionally, this new internet business model has distinctly altered the way that companies view strategy, with a distinct shift from product-focused strategy to customer relationship management (CRM), which is “underpinned by information systems convergence and the development of supporting software, which in turn promises to significantly improve the implementation of Relationship Marketing principles” (Ryals & Knox, 2001).

To this end, Chan Kim & Mauborgne argued that blue ocean strategy is vital in the contemporary business paradigm by not competing in the existing market space and create an uncontested market space. Furthermore, the essence of the blue ocean strategy is that focus on competition is incorrect and it is necessary to create a new demand and that as such, the company’s systemic approach should be underpinned by differentiation and low cost (Chan Kim & Mauborgne, 2005). Indeed, Chan-Kim & Mauborgne comment that “of course, competition matters.

But by focusing on competition… have ignored far more lucrative aspects of strategy: One is to find and develop markets where there is little or no competition – blue oceans and to protect blue oceans” (Chan Kim & Mauborgne, 2005).