This section of the article proposed as a research study, in contemplation, defines the

characteristics of the good blue ocean strategy by breaking the trade-off between
differentiation and low cost strategy, and demonstrates the fun and thrilling triumph of Cirque
du Soleil on how it raked insurmountable revenues in the industry, lifting buyer value while
significantly driving down cost at the time of its debut.

How will we define the very character and uniqueness of the blue ocean strategy (BOS)? The
core characteristics of BOS as mentioned from the study are to create uncontested markets and
make the competition irrelevant. Be it in contrast to Porter’s influential view towards the
industry in which simultaneous application of low cost and differentiation cannot achieve
greater profitability.

Primarily, blue ocean strategy seeks to amass new and existing demand differently by
distinguishing a product or service from others, to make it more attractive to a particular target
market. Differentiation leadership alone could be costly in terms of its marketing capabilities
such as advertising and at the same time it enables a firm to sell products and/or services at
premium. As for example, Mercedes makes their cars to appear more luxurious than the
models of rivals in the same range where it highlighted that Model-specific advertising which is
more effective than brand advertising. Sophistication directly prides itself to its superior
customer experience as it continually increases price and perceived value. But higher prices are
a sort of “make up” for their higher costs. Not the same case with Cirque, whose eliminated
many of the traditional circus offerings along with other most expensive elements while making
the buyers believe that they have reasons to come to the circus more frequent. Reevaluation of
conventional logic of outpacing the competition for Cirque has been in its agenda in order to
reflect and to make space to add and integrate more value.

Now the question is, when a firm achieves significant economy of scale does it imply a cost
leadership strategy to compete compatible with differentiation? Building a strategy on a
differentiation requires a company to continuously invest in and develop superior product
quality and branding while building a strategy on minimizing costs requires a company to
achieve cost-effective production process and use of bargaining power to negotiate lower
prices for production inputs. This two variants of focus strategy are separately identified and
used alternatively for the function of the firm's strengths and weaknesses combined with the
competitor's positions in the market. However, Porter suggests that, whatever strategy is
chosen, the firm should try to maintain "parity" with its competitors rather than being “stuck in
the middle”. Therefore a differentiator should not completely forget price and a low-cost
producer should not forget quality. This could be portrayed on Cirque that even if it stripped
away some traditional circus offerings, it retained acrobats and injected some other new
elements and thrills resembling a theatrical performance with a high level of audience comfort.
It’s in a way of value innovation without deviating from the industry.

Through my analysis and observation, Kim and Mauborgne seek to balance the scales so that
formulating and executing BOS can become as systematic and actionable as competing in red
oceans of known market space. In conclusion, there are still some disputable strategic concerns
about BOS that if we were to evaluate situations assessing the scale of niche market demand
through value innovation, BOS must also consider the gravity of the competitive forces that
eventually erodes profits from innovation. In this scenario, profits are positively related to the
number of firms in the short term, but negatively related in the long term.