Generally speaking, Cirque du Soleil was prosperous because it utilized a blue ocean strategy that primarily relies on value innovation. This strategy tries to make the competition not matter by establishing new and uncontested market opportunities. Cirque du Soleil employed an eliminate-reduce-raise-create strategy to establish a blue ocean of a certain market space to raise its competitive advantage. Firstly, Cirque du Soleil eliminated many elements that were taken for granted. First, it removed all shows involving animals because, over the years, the inhuman treatment of animals has generated widespread concerns. Also, animals were expensive to use due to their need care, medical attention, transportation, diet, as well as insurance. Second, they removed star performers as they were expensive. Third, it did away with the normal three-ring venues since they were costly because many performers were required to be on stage concurrently. It finally abolished sales of aisle concession.
Secondly, in the reduction strategy, Cirque still used clowns but minimized their value in the shows. Further, it changed the clown humor to a more practical stimulating style. Thirdly, in adopting the raise strategy, it markedly increased the live performance quality. Cirque idealized the circus tent as other circuses abolished it, thereby, increasing the public’s attention. Also, it increased ticket prices because it attracted a crowd which was willing to pay more for tickets and had an adult audience. Finally, in the creating strategy, Cirque came up with a new experience in entertainment. It managed to do this by integrating the thrill and fun elements of the traditional circus with the elegance and superior choreographed theater performances.
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Which industry does Cirque du Soleil compete in? Who are its competitors?
Cirque du Soleil competes in the entertainment industry and its main competitors are Cineplex, SFX, Two Bit Circus, Qubit, Founders Entertainment, as well as Tealium.
Which factors contributed to Cirque du Soleil losing its competitive advantage, and as a consequence led to a 50 percent drop in its valuation? Look at both external and internal factors.
The worldwide financial crisis that took place between 2008 and 2010 contributed to Cirque du Soleil losing its competitive advantage. Worse still, Cirque’s management made poor strategic decisions. This included providing several shows that were considered little differentiated. For this reason, it lost its rarity appeal, and there was also an inflation in its payroll and costs. In addition, the company experienced misfortune as one of the performers fell to her death during a live show performance. As a result, Cirque was issued with fines and citations.
Ways to address the performers’ safety concerns.
Firstly, Cirque should establish a culture where performers can freely air the safety concerns during performances. Secondly, it should remake their shows to minimize the danger to its performers. Thirdly, it should come with protective gears for its performers.
In my opinion, Cirque du Soleil will lose its differentiated appeal to audiences with more safety measures and less risky shows since the company prides itself in invoking the senses as well as evoking the imagination of people. This usually involves doing risky stunts that will amaze the audience. However, organizing less risky shows will not really intrigue the audience as people are already used to the risky stunts.
Recommendations
Firstly, Cirque should come up with a strategic plan and highlight their purpose and objectives, then make decisions according to the strategic plan. This will help it focus on the most important issues. Secondly, it should develop a culture where performers can bring to light their safety concerns. Thirdly, it should remodel its shows to minimize risks and further offer protective gears to its performers. Finally, the company is on the right path with seeking diversification into other entertainment sectors. As a consultant, I would stress on looking for other income generating projects as it will expand our consumer base henceforth increasing revenues.
