Creating a new market (a "blue ocean") is easier and more lucrative than competing in an existing one (a "red ocean"), according to this book. This is a sort of practical application of that truth known to all economists, that wealth is not a zero-sum game. By seeking new ways to create value for your customers, rather than competing on the old ways, you unlock massive untapped potential.

The book cites numerous examples including Cirque du Soleil, Home Depot, FedEx, [yellow tail], and Dell. Visually, a company's strategy can be drawn as what they call a value curve. This plots various types of value provided to customers on the horizontal axis, and the quantity in each on the vertical axis. Similar firms competing on the same territory will have very similar shapes to their value curves, though they may fall at different levels.

For example, a low cost wine and a high cost wine offer similar types of value, just at different levels relative to their price. On the other hand, [yellow tail] offers dramatically higher value in some areas and dramatically lower in others, producing a unique product combination that reached well beyond the existing demand of wine drinkers.

Blue ocean strategy also puts emphasis on avoiding market segmentation and instead focusing on keeping costs low by seeking similarities between customer's needs and emphasizing those, rather than differences. It also suggests seeking a low price point immediately, with the intention of reaching a wide audience, high mindshare, and economies of scale as early as possible. (The standard strategy for innovations is to first price them very high, appealing to a limited market, and then gradually bringing the price down over time.)

Great material, highly recommended for anyone creating a strategy for a new venture.