“Create. Don’t compete … Move your organization from cutthroat markets with bloody competition — what we think of as red oceans full of sharks — to wide-open blue oceans, or new markets devoid of competition,” wrote W. Chan in Blue Ocean Strategy.
Blue Ocean Strategy is one of my favorite books on strategy, but it doesn’t work for a lot of companies. If you sell your products and services in retail or e-commerce, you’re stuck in a red ocean. This requires a different mindset and branding strategy to succeed.
For example, wineries that want to sell in Ontario, Canada have to deal with the LCBO. The LCBO is a boozopoly. It’s a government agency that controls the sale of wine and spirits in Ontario, and it’s a big business with over $5 billion in revenue.
From a consumer perspective, the LCBO is pretty good. From a brand perspective, it’s problematic.
LCBO puts its customers first and delivers an excellent buying experience. The stores are modern, easy to navigate, and offer a broad selection of wines, spirits and beers from around the world. The staff are knowledgeable and always willing to make a recommendation.
To deliver a broad selection the LCBO emphasizes categories, not brands. You can see this in the wine section. Consumers don’t seek out a specific label or brand. They’re encouraged to buy based on region, grape, and price. For instance, you may look for a California merlot that’s between $20 to $25, or a Chateauneuf du Pape in the $50 to $70 range. The product you choose is based more on what’s available than the brand itself.
LCBO is a quasi-monopoly that defines its own rules. Wine and spirit companies have little to no influence over this retail environment. If they don’t want to play by the rules, the LCBO will simply select another brand to put on its shelves.
The LCBO is not unique. Any brand that sells on a major marketplace has to play by the rules of that market. If you want to sell your products on Amazon, eBay, Walmart, or Target, you’ve got to play the game — their game.
Amazon is transparent and has three constants that define its brand. They want to deliver their customers:
- Lots of choice;
- Low prices; and
- Fast delivery.
Amazon promotes brands and products that help fulfill its mission, and removes products that don’t.
Do a search on any category on Amazon, and you can tell which brands are playing to win. Every detail of their listings target their customers’ wants and needs. They know who their customers are, what they want, how they buy, and they tailor their brand for maximum impact. This is what it takes to win in a red ocean.
Branding for a red ocean is a competitive sport. Your brand has to make your products stand out when customers are comparing options down to the littlest details:
- Brand Name
- Package design and identity
- Product description
- Keyword optimized copy
- Social proof via reviews
- Inbound links via review sites, endorsers, and influencers
- Promoted posts to rank higher in search results
Each detail matters in a red ocean. You’ve to got to play the game better than your competitors to win.