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Testing the Validity of Blue Ocean Strategy versus Competitive Strategy: An Analysis of the Retail Industry

Author

Listed:
  • Andrew Burke

    (Trinity College Dublin)

  • Andre Van Stel
  • Roy Thurik

    (MRM - Montpellier Research in Management - UPVM - Université Paul-Valéry - Montpellier 3 - UPVD - Université de Perpignan Via Domitia - Groupe Sup de Co Montpellier (GSCM) - Montpellier Business School - UM - Université de Montpellier)

Abstract

We investigate the nature of the competition process in retailing by contrasting blue ocean strategy and competitive strategy. We develop a methodology to test the core assumptions of both these major schools of strategic management. Applying this methodology to a large data set of shop type averages within the retailing sector, we find empirical support for blue ocean strategy in terms of creating new retail market space. At the same time we also find support for competitive forces eroding temporary profits. However, we find that these forces are sufficiently slow to enable periods of supernormal profits for retail innovators.

Suggested Citation

  • Andrew Burke & Andre Van Stel & Roy Thurik, 2016. "Testing the Validity of Blue Ocean Strategy versus Competitive Strategy: An Analysis of the Retail Industry," Post-Print hal-02014003, HAL.
    • Handle: RePEc:hal:journl:hal-02014003
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    Cited by:

    1. Desalegn Yeshitila & Daniel Kitaw & Kassu Jilcha & Mamo Muchie, 2020. "Situational and Mixed Business Strategy Analysis for Market Competitiveness: An Exploration in Context of Africa," International Journal of Global Business and Competitiveness, Springer, vol. 15(2), pages 106-120, December.

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