The Blue Ocean strategy teaches us that everyone is unique. Our DNA, upbringing, and the environment we live in shape our individuality. When a group of people unites around a single goal, unique companies are born—companies of which there is only one in the world. This strategy can help highlight the unique aspects of your Managed Service Provider (MSP) in the IT industry and create a distinctive market position.
For its importance, you also have to look at the beautiful set of brains people have. A brain that must make the “right” decision in a split second to survive. (also read the white paper ‘The unconscious influence in marketing & sales) Not only in making a good decision but also in doing so energy efficiently. Therefore, the brain is constantly looking for patterns. So our brain is super good at pigeonholing. Our brain, by now, instinctively knows that you can buy bread at the bakery.
And everyone loves bread, so thousands of bakeries have sprung up in the Netherlands. More every year. Bakers are all alike. After all, they all make bread. But also, all are unique in their unique way. But then, what makes them unique? With bakers, of course, you can think about assortment, location, preparation methods, the baker himself, that friendly saleswoman, and so on. Somewhat tangible, unique properties.
Development of number of hot and cold bakery establishments, 2011-2021
As with bakers, the same applies to Managed Service Providers or other IT vendors. But how do you make sure you are mainly found as an MSP? What makes you different from others? As with the bakers, what makes you unique?
Blue & Red Ocean
The Blue Ocean Strategy, described by W. Chan Kim and Renee Mauborgne, can help answer these questions.
The strategy suggests that it’s not effective to place yourself in the same box as your competitors. Doing so would place you in a so-called Red Ocean, characterized by fierce competition. You would have to beat your competition through price and product differentiation, resulting in a battleground where the ocean turns from blue to deep red. We see that IT companies primarily operate according to the Red Ocean strategy. To break this cycle, you must recreate your value proposition (Value Innovation). Within this value innovation, you must take two crucial steps: service or product renewal & cost reduction.
Implementing this innovation and cost reduction will create a Blue Ocean. An ocean without competition. I’ll give you two examples that are often used:
- Cirque du Soleil – Combining circus, dance, and ballet, Canada’s Cirque du Soleil managed to create a new kind of performance. In addition, many fixed costs, such as circus animals and expensive star performers, were removed from the program. This allowed Cirque du Soleil to establish a new kind of “circus” with higher revenues. This created a very profitable “circus” concept.
- Nintendo Switch – An innovation in controlling the game console and not betting on an increasingly powerful game console with expensive components opened up a new market. Because of its controls, a unique game console could be put away at a reasonable price without the expensive components.
What about IT?
Looking closer to home, you can see Office365 as a Blue Ocean. By rethinking the traditional way software was sold as a boxed product with a distribution model, Microsoft reinvented its application suite as a service. Companies only pay for their use of the suite. By cutting production and distribution, Microsoft eliminated many traditional costs.
You must examine your products and services closely for IT vendors and MSPs. What can you combine or add to your offering to make your solution unique? A helpful approach is to offer your service to a specific target group. Which (new) target group can you address with this? Where are the opportunities in that target group? What additions to your portfolio make your solution even better suited for that target group?
When implementing a Blue Ocean strategy in your MSP, it is essential to critically evaluate your product and service offerings and your target audiences. In analogy with Nintendo, will you, as an IAAS provider, offer more capacity and computing power, or will you enable more innovative controls
It is essential to understand that creating a Blue Ocean is not only about finding a niche in the market but also about delivering real value to your customers. Positioning yourself as a unique player in the IT market allows your MSP to grow and prosper without being overshadowed by the fierce competition in the Red Ocean.
To get you started in implementing the Blue Ocean strategy in your MSP, Force21 offers the following steps:
- Analyze your current product and service portfolio and identify strengths and weaknesses.
- Determine what unique aspects of your MSP you want to highlight and how to improve or innovate.
- Choose specific audiences that can benefit most from your unique offering and adjust your marketing strategy accordingly.
- Look for ways to reduce costs without compromising the quality of your products and services.
- Stay abreast of the latest technological developments and trends in the IT market so that you can respond quickly to changing customer needs and expectations.
- Invest in building strong relationships with customers and partners to build a solid reputation and ensure long-term success.
Do you want to swim in a Blue Ocean as well? But don’t know where to start? Then, contact us to uncover your unique qualities and create a distinct position in the IT market. By implementing the Blue Ocean Strategy, you can differentiate your MSP from the competition and achieve long-term success in a constantly evolving market.
Together, we can explore new opportunities and help your MSP stand out in the IT industry. Contact Force21 today and discover how our expertise can help your company implement a successful Blue Ocean strategy. Don’t hesitate to seize the chance to grow and thrive.
Reach out to Force21 today, and let’s embark on this exciting journey together! Let’s start today!
