I finally had a chance to read up on "Blue Ocean Strategy" as a part of my Marketing class on Value Creation and thought enough of it to try to make some connections to the Mixed Martial Arts industry. If you're unfamiliar with the 'blue ocean' concept, the basic idea is that companies have a tendency to play within existing industries and fight to outperform one another within the context of the generally accepted rules and business practices. This traditional space is referred to as 'red ocean' because the fighting becomes so intense that the waters turn red with blood. A 'blue ocean' strategy, on the other hand, is one that creates new market space by expanding or even ignoring industry boundaries, making the competition irrelevant.
One of the more interesting examples of this 'blue ocean' strategy is Cirque du Soleil. The success of Cirque is detailed in this excerpt from the "Blue Ocean Strategy" text:
A one time accordion player, stilt-walker and fire-eater, Guy Laliberte is now CEO of one of Canada's largest cultural exports, Cirque du Soleil. Created in 1984 by a group of street performers, Cirque's productions have been seen by almost 40 million people in 90 cities around the world. In less than 20 years Cirque du Soleil has achieved a revenue level that took Ringling Brothers and Barnum & Bailey's Circus - the global champion of the circus industry - more than one hundred years to attain. What makes this all the more remarkable is that this rapid growth was not achieved in an attractive industry. It was in a declining industry in which traditional strategic analysis pointed to limited potential for growth. Supplier power on the part of star performers was strong. So was buyer power. Alternative forms of entertainment - ranging from various kinds of urban live entertainment to sporting events to home entertainment - cast an increasingly long shadow. Children cried out for Play Stations, rather than a visit to the traveling circus. Partially as a result, the industry was suffering from steadily decreasing audiences and, in turn, revenue and profits. There was also increasing sentiment against the use of animals in circuses by animal rights groups. Ringling Brothers and Barnum & Bailey's Circus set the standard and competing smaller circuses essentially followed with scaled down versions. From the perspective of competition-based strategy, then, the circus industry appeared unattractive.
If Cirque du Soleil can successfully reinvent the circus it got me wondering what the equivalent might look like within the sport of Mixed Martial Arts. This topic is particularly interesting given that, in many ways, the UFC itself began as a 'blue ocean' idea. Originally conceived in 1993 as a "War of the Worlds," the idea was pitched to Semaphore Entertainment Group (SEG) who was looking to create new categories for a pay per view market dominated by wrestling, porn, and Mike Tyson. Jonathan Snowden details the history of the birth of the UFC from the perspective of Adman Art Davie in his comprehensive book on the history of MMA "Total MMA: Inside Ultimate Fighting."
Davie said, "Milius, Gracie and I were sitting around talking one night, and we began to have a conversation, like guys used to have in Vietnam, about if Sugar Ray Robinson were alive and fought Bruce Lee who would win. People always have those 'what if?' conversations in the martial arts. Out of it came a desire to do this event. I went back to my agency and had my art department put together a comp called 'War of the Worlds.'"
In many ways, Davie and SEG were doing for combat sports what Cirque du Soleil did for the Circus. The idea of fighting as a spectator sport was certainly nothing new, but the tournament format in which competitors would be required to fight multiple times in a single night to win, the octagon shaped cage as a replacement for the traditional boxing ring, and the representatives of different fighting styles competing under a loosely defined set of unified rules were all 'blue ocean' concepts. Combat Sports would never be the same.
After the jump I will take a closer look at Chuck Norris and his 'blue ocean' ideas.
