Chapter 6: Blue Ocean Strategy (Price (Know from the start what price will…
Chapter 6: Blue Ocean Strategy
Build a robust business model to ensure that you make a healthy profit on your blue ocean idea
revenue of the company
Buyer utility and price
Creates a leap in value for itself in the for of profit
Unless technology makes buyers life better in anyway it will not attract masses
Buyers experience cycle
How Long it take to find? is the place of purchase attractive and accessible? How secure is the transaction environment? How rapidly can you make it?
How long does it takes? How difficult is to unpack?Do buyers have to arrange delivery system themselves?
Requires assistant? Is it easy to store? How affective are the functions? Is it overdone?
Do you need anything else to make it work? if so how costly, how much time, how much pain and how easy?
Does it need it? Is it easy to maintain and actualize? How costly?
Does it creates waste? How easy is to dispose the product? Are they legal requirements? How costly?
Fun and image
Know from the start what price will attract the mass
Volume generate higher returns
To a buyer the value of a product may be closely tied with the number of people using it
The cost and risk of an idea are borne in the initiator
Star with a price buyers can´t refuse and discourage any free-riding immitation
The price should attract buyers and retain them
1_ Identify the price corridor of the target mass
List of products
Different form but same function
different form and function but same overarching objective
2- Specify a price level within the corridor
Upper level priceing
High degree of of legal and resource protection, difficult to imitate
Some degree of legal and resource protection
Lower level pricing
Lowe degree of legal and resource protection. Easy to imitate
Price - costing and not cost plus pricing
Structure that is profitable and hard to match
streamlining operation and introducing cost innovations from manufacture to distribution
Meet their target cost by partnering
Changing the pricing model
Address the concerns about the impact of the strategy in their lives and livelihoods
They fear their revenues streams or market positions are threatened by a new business idea
If treatheneds social of political norms
Key is engage in an open discussion