Before we begin sketching out the completed strategy canvas, we should first begin by deciding which direction we want to pursue. In Blue Ocean thinking, there are a number of potential avenues to follow, all of which can, and would certainly generate a new and uncontested pool of customers. These avenues include the following:

  1. Looking across alternative industries
  2. Looking across the various strategic groups within the industry
  3. Looking across the chain of buyers
  4. Looking at complementary products and services
  5. Looking across the boundary of functional and emotional appeal to buyers
  6. Looking through time

As we decide which direction to take, we will look into each of these potential paths in detail. ideally, I will provide an example of each path, as it relates to the anime world at large.

Avenue 1: Alternative Industries

Seminal created a blue ocean by pitching ICE to indie film customers, and not using normal anime sales channels.

On a top-level view, alternatives seem similar to subtitutes in many regards. At a glance, they’re both products that serve as a replacement for a given good. However, at one delves deeper into these two terms, it becomes clear that they do not reference the same thing.

According to The Blue Market Strategy, a substitutes are products with different forms from each other, even though they offer the same base functionality or satisfy the same base wants. For example, an action fan can satisfy the need for a fast-paced experience with anime, an American TV show, or an action movie on DVD. They all satisfy the same base need, even though they have different formats and forms.

On the other hand, an alternatives are products that serve the same purpose, even though they come in different forms. For example, a movie theater and an anime convention are two completely different beasts. The movie theater offers two hours of audio-visual entertainment, with comfortable seats and little conversation. On the flip side, an anime con offers one to three days of bustling environments, multiple events and panels to see, and surprisingly little sitting room. They couldn’t be more different. However, they do fulfill the same purpose of giving the customer some time away from the house.

Customers subconsciously weigh alternatives when considering what they want to do with their time and money. However, companies rarely take this into consideration when marketing their products to the masses. Those who do will find themselves reaping the benefits of the market at large.

An example of a company reaching across alternative industries came about in December, 2011 when Seminal Films announced that they acquired the domestic rights to the ICE film. Rather than sell the item as anime to anime fans, Seminal side-stepped the industry, and pitched the title as an exclusive through boutique DVD seller MVD. They pitched the title as an alternative to consumers of indie flicks, who typically purchase lower-budget films that are made to satisfy a tiny niche. Anime, while it is completely different from the typical indie film, will often satisfy the same base purpose of providing entertainment to the consumer.

Avenue 2: Strategic groups within the industry

Streaming services like Crunchyroll offer low-priced, convenient access to anime streams.

In the business world, a strategic group are a bunch of characters that pursue similar strategies to capture customers. Typically, these groups are ranked in terms of price and performance, with each jump in price leading to a jump in performance. The vast majority of the industry competes within the same strategic group, as they try to undercut one another, or jump up in some aspect or another. NIS America and Aniplex, for example, offer fancy, decorated art-boxes, extensive tangible bonus material, and copious extra features in exchange for a premium price. Media Blasters, on the other hand, tends to shoot for the low end of the spectrum, with inexpensive show sets that feature fewer episodes than the typical FUNimation or Sentai Filmworks release. Neither of these three groups pays much attention to each other, since they don’t consider themselves competitors in the traditional sense.

Rather than work within this frameworks, a business can look at the factors that cause customers to trade up or down, and formulate a strategy. Let’s take a look at the strategic groups of DVDs and streaming services:

  • DVDs/Blu-Ray: product ownership, portable, simple
  • Streaming: Convenient, low price

DVDs and Blu-Rays offer convenience, portability, and ownership at the cost of some conveniences.

DVDs and Blu-Rays are portable, in the sense that they can be viewed with or without an online connection, they can be transported, and they’re able to be exchanged freely. Viewers own the product, so that they aren’t locked out, or forced into a lower-quality product if they lapse on a subscription. They are free to loan and sell this as they desire.

Streams are convenient, as they offer access to HD quality episodes at a cost that ranges from free to $8 per month. They offer a large selection of titles that can be viewed online, though access isn’t a given. Changes in licenses and streaming rights, or failure to pay a subscription can lead to a viewer being locked away from content.

A (hypothetical) example of someone working across these strategic groups could occur if an organization offered a slightly higher-priced Blu-Ray or DVD, with access to an HD digital copy hosted on a remote server, or on via a seller like Amazon or iTunes. This would grant the convenience of the digital streaming version of the show, while maintaining the ownership and portability of the physical copy. This could command a slightly higher price from the market, as many consumers would gladly pay for the right to have their product at any time and any place.

Avenue 3: The Chain of Buyers

The chain of buyers is the series of people that a product passes through before it reaches the final consumer. This includes the following:

  • Buyers, who acquire products for retail sale
  • Influencers, who recommend products for purchase to either buyers or users
  • Users, who are the final consumer

Each of these segments values different things. Buyers value logistical assets such as quick restocks, fast delivery, and generous financing programs. Users don’t value any of this, even though it affects them. Instead, factors like attractive packaging, numerous extras, and high episode counts will be first on a customer’s mind.

At the moment, we are in an industry that focuses heavily on the user and the influencer. However, many of the distribution practices, from shipping to returns are industry standard. Making a shift of focus to the buyer could open a new blue ocean by making the market favorable to those who would acquire the product. Retailers, sellers, and the like will often be eager to partner with those who create such positions, and eagerly embrace methode that reduce their costs while increasing their ability to deliver product to the customer. This could come in the form of a less expensive presentation, a smaller footprint on shelves, or even a distribution method that cuts out a need to warehouse as much product. Unfortunately, without knowing just how a company works in logistics, it will be difficult to make detailed recommendations.

I hope you are enjoying this chapter so far. Part 2 will be published tomorrow evening!