Ecosystem is a word that has been used many times during the course. Although I don’t have any doubts that all of you understand what it means by now, I decided to write a post about a company that managed to create something that can truly be called a blue ocean market-creating ecosystem.
Founded in 2006 in, Envato is an Australian company that operates a network of online marketplaces focused on digital content provided by creatives and professionals from all around the world. Registered authors use this platform to sell their products to end users and customers, while Envato takes the role of middleman and focuses on operating the platform, without creating any content.
Marketplaces are focused on different areas of web design and digital advertising industry. The complete list is as follows.
1. ActiveDen – Flash components and templates
2.ThemeForest – WordPress templates
3. AudioJungle – Music loops and samples
4. GraphicRiver – Stand-alone graphic elements (logos), business card templates etc.
5. VideoHive – Stock video footage, Motion graphics templates
6. 3dOcean – Stock 3d models and 3d animations
7. CodeCanyon – Developer tools, plugins for popular CMS (e.g. wordpress)
Authors decide to use the marketplace because it serves as a powerful distribution channel, buyers are attracted because they can choose from wide range of quality items in a single store. The number of registered users is currently slightly above 1.1 million and is still growing rapidly. Although Envato as a middleman takes 30% cut of each sale realized through the platform, authors are happy to sacrifice it because of the fact that they would not be able to reach such a wide audience if they had to market their products by themselves. Authors that provide quality content enjoy interesting wages, buyers enjoy high standard products and Envato makes money by providing these two parties with meeting point. In the end, this creates a *bi-winning* situation in which all elements involved in the ecosystem are satisfied.
When asked about the reason behind the inception of the first marketplace, the CEO of the company (Collis Taeed) responded that he was simply looking for a website that he could use to sell some of his files to numerous people at the same time. As he didn’t find one, he decide to create it. This is, at least in my view, a real life example of blue ocean strategy in practice. As we have learned, industry knowledge, ability to think outside of the box and recognize business opportunities is crucial for successful creation and orchestration of blue ocean ecosystems. This was exactly the case of Envato. Starting from a garage in 2006, Collis managed to grow his company into a multi million dollar business without any external funding whatsoever. All he needed was an open mind and solid background.
I hope that you find this post interesting and inspiring. Moreover, I also hope that it helps with the understanding of explain blue oceans and ecosystems in a real life context.
Strategies Beyond Markets 