Thursday, March 29, 2007

Creating Uniqueness by Divergence

The next time you are trying to demonstrate that your product or program is unique, take a lesson from the authors of Blue Ocean Strategy. In there exceptional book on how companies created markets where there is no competition, they share four principles of divergence:

Elimnate - What factors or qualities of your product, that the industry takes for granted, should be eliminated!

Take something away that is not critical to the success of the product. Cirque du Soleil got rid of the animals you would normally find in a circus. Not only did that reduce costs, it allowed them to create a new experience and did away with the myth that the circus was all about animals. Not only did they do away with the animals, they got rid of the star performers and aisle concession sales.

Reduce - What qualites of your product should be reduced well below the industry standard?

Southwest Air reduce the perks that you get when traveling. Things like seating choices, lounges, meals all were done away with to serve upa better price. Turns out most passengers did get upset. Yellow Tail wines did away with industry standards like vineyard prestige and branding and reduced the complexity of picking wine.

Raising - What qualities of your product should be raised well above the standard of the industry!

Yellow Tail wine raised the bar on the industry when they improved the involvement of retailers in the sale of their wine. Despite being a values (cheap) wine, through the use of many of these four strategies, they command a quality wine price. Cirque du Soleil began having events in unique and higher quality venues.

Creating - What factors or qualities could be created that the industry currently does not offer?

Southwest "pioneered the concept of point to point travel" when all other major airlines where using a hub and spoke system. The result was faster and frequent travel between two major cities. Unique at the time, now others like Jet Blue are using the same approach to take over valued markets like Atlanta to NY. Yellow Tail wine made it easier to select and drink wine. Cirque du Soleil brought qualities of theater to the circus.

So it is simple: Eliminate-Reduce-Raise-Create!

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