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Why are Red Ocean Traps so dangerous?

Exceptional article with plenty of examples. It opens up the reader’s mind on issues with mental models. Here a summary of my personal learnings, which I will keep in mind in my strategy work around creating new markets:

  • Market power has moved from companies to consumers.

  • Long-term success will depend on the ability to generate new demand and create and capture new markets.

  • Organizations need to turn their focus to noncustomers and why they refuse to patronize an industry’s offering.

  • Uncovering a niche in an existing space is not the same thing as identifying a new market space.

  • Products and services succeed because they are so simple to use, fun, and productive that people fall in love with them.

  • Value innovation, not technology innovation, is what launches commercially compelling new markets.

  • Successful new products or services open market spaces by offering a leap in productivity, simplicity, ease of use, convenience, fun, or environmental friendliness.

  • A market-creating move breaks the value-cost trade-off. It is about pursuing differentiation and low cost simultaneously.

  • New market space is created not by pricing against the competition within an industry but by pricing against substitutes and alternatives that noncustomers are currently using.

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