No Ocean Strategy: Why Sailing For Blue Ocean Is A Ticket On The Titanic

"There's no ocean—now what?"

Arrrrrrr, Pirates! We are beginning to transform our weekly letters (and mini-books) into mini-ebooks you can now collect, save, gift, and share via Amazon. Last week, we published our first 3: The Big Brand Lie, Become Known For A Niche You Own, and A Pirate’s Guide To A Legendary IPO. To be clear, if you are a paid subscriber then you already have access to this content in our newsletter. But for those who want to save their favorite mini-books, or refer back to them on Kindle, they are now also available on Amazon. Soon, we will have the audio versions of every mini-book available as well. Lots in the works! THANK YOU for being such ferocious readers—we love having you aboard this pirate ship.


Dear Friend, Subscriber, and Category Pirate,

In 2005, a little book called Blue Ocean Strategy grew into a global bestseller. 

With over 4 million copies sold and industry recognition as “one of the most iconic and impactful strategy books ever written,” Blue Ocean Strategy changed the way many people thought about business. We tip our hats to the title, and the framing of the idea, because it is a legendary example of Languaging. More than 15 years later, and you will still hear people in business meetings referencing “blue oceans” and “red oceans.” 

But...

There are a few problems.

The book assumes the ocean. 

The book assumes incumbents are the ones that create new categories.

The book assumes blue oceans are not about technology innovation. 

The book assumes Superconsumers and data-flywheels play a limited role in category domination.

The book assumes category leadership is about product and company design, not the ability to create and design categories.

Wait, Don’t Pirates Like Blue Oceans? 

First of all, Pirates reject the premise! They don’t just blindly accept the way it is.

(Allows for unconstrained thinking.)

We know a lot of our fellow pirates like Blue Ocean Strategy and may be confused as to why we are writing this. We get asked about it from time to time, so we thought we’d respond with a letter to make clear the difference between Category Design and BOS—specifically where we overlap and where we meaningfully disagree. The truth is, Category Design and Blue Oceans do align nicely on a few important themes. 

  • Corporate strategy is rooted in military strategy and thus overly focused on competing. We totally agree! Competition is a race to the bottom. Competition is for people who make products that are undifferentiated and rely on “make the logo bigger” strategies to eke out their next quarter’s numbers. Those executives should rightly prepare three envelopes. Category creators force a choice, not a comparison. 

  • Companies and industries are the wrong ways to frame the world. Yes! Too many executives, analysts, and investors overly attribute a company’s success to the actions and moves the company has made versus the overall category tailwind. Traditional industry definitions are blinders that prevent us from seeing category creators hiding in plain sight. Like how so many Wall Street Analysts missed the rise of Tesla because they were trying to apply auto industry valuation comps to it. 

  • Creating blue oceans builds brands. Sort of. Categories make brands, not the other way around. We love that Blue Ocean thinking might help prevent the next Red Bull Cola.

The Dangerous Delusions Of Blue Ocean Strategy

Here’s what the authors of Blue Ocean Strategy assert from their analysis, in their own words. 

(The emphasis is our own.)

“Our findings are encouraging for executives at the large, established corporations that are traditionally seen as the victims of new market space creation. For what they reveal is that large R&D budgets are not the key to creating new market space. The key is making the right strategic moves. What’s more, companies that understand what drives a good strategic move will be well placed to create multiple blue oceans over time, thereby continuing to deliver high growth and profits over a sustained period. The creation of blue oceans, in other words, is a product of strategy and as such is very much a product of managerial action.”

Let’s break down each underlined section. 

Because words frame thinking. And context is everything:


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