Which of the following statements about blue-ocean strategies is NOT true?
a. Blue-ocean strategies invent a new market segment that renders existing competitors irrelevant.
b. Blue-ocean strategies provide a company with a great opportunity in the short run.
c. a blue-ocean market space is untainted by competition and offers wide-open opportunity for profitable and rapid growth if a company can come up with a product offering that allows it to create demand.
d. blue-ocean strategies are offensive strategies that involve a preemptive strike to secure an advantageous position in a mature market segment.
e. blue-ocean strategies view the business universe as consisting of two distinct types of market space.
The Correct Answer and Explanation is :
The correct answer is: d. Blue-ocean strategies are offensive strategies that involve a preemptive strike to secure an advantageous position in a mature market segment.
Explanation:
Blue-ocean strategies are a concept from the book Blue Ocean Strategy by W. Chan Kim and Renée Mauborgne. These strategies emphasize creating entirely new market spaces or “blue oceans” where competition is minimal or nonexistent, rather than competing in established markets or “red oceans” characterized by fierce rivalry. Here’s an analysis of why option (d) is NOT true and an explanation of the other options:
- (a) Blue-ocean strategies invent a new market segment that renders existing competitors irrelevant.
- This statement is true because the essence of a blue-ocean strategy is to break away from existing market boundaries and redefine the market space. By doing so, companies create new demand and make competition irrelevant.
- (b) Blue-ocean strategies provide a company with a great opportunity in the short run.
- This statement is true because companies that successfully create blue-ocean strategies often experience rapid initial growth and profitability, as they operate in a space with little to no competition.
- (c) A blue-ocean market space is untainted by competition and offers wide-open opportunity for profitable and rapid growth if a company can come up with a product offering that allows it to create demand.
- This is true as well. Blue-ocean strategies are about innovation and opening up new markets that offer significant growth potential without the constraints of established competition.
- (d) Blue-ocean strategies are offensive strategies that involve a preemptive strike to secure an advantageous position in a mature market segment.
- This is NOT true. Offensive strategies in mature markets involve competing directly with rivals to secure a competitive position, which aligns with red-ocean strategies. Blue-ocean strategies avoid established, competitive markets entirely by creating new ones.
- (e) Blue-ocean strategies view the business universe as consisting of two distinct types of market space.
- This is true. The concept identifies two types of markets: red oceans (existing markets with competition) and blue oceans (new markets with untapped potential).
Thus, (d) is the correct answer because it contradicts the fundamental idea of blue-ocean strategies, which focus on avoiding direct competition rather than engaging in it.