Blue Ocean Strategy Case Study

Cirque du Soleil: Creating a Blue Ocean by Balancing Creativity and Business

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Abstract:
In a maturing circus industry dominated by more than a century old giant players like the Ringlings and Barnum & Bailey, Guy Laliberté and Daniel Gauthier founded Cirque du Soleil (Circus of the Sun) in 1984. Cirque was a new entrant in an industry, which was afflicted with falling revenues and profit for a long time. During this time, children, the traditional patrons of the circus, were more attracted towards television, computers and video games compared to animal acts, clowns and jugglers featured in a circus. Rather than sticking to the age-old formula for running a circus, Laliberté and Gauthier built their circus along unconventional lines. After identifying that the three core elements of any circus were the tent, the clowns and the acrobatic acts, they did away with the expensive animal acts and launched shows based on unique themes, soundtrack, costumes and sets. Cirque's 'one of a kind' shows that resembled theatric and ballet performances, targeted adults rather than children. After achieving phenomenal success in a matter of two decades, Laliberté planned to extend the Cirque du Soleil brand to spas, restaurants and resorts.

Pedagogical Objectives:

• To discuss and contrast the traditional business model of the circus industry and the new business model of Cirque du Soleil
• To discuss the Blue Ocean strategy in the context of Cirque du Soleil
• To discuss the sustainability of Cirque du Soleil's unique brand of entertainment in the light of an increasing number of 'copycat' circus shows
• To debate Cirque's proposed diversification strategies

Keywords : Cirque du Soleil; Circus industry; Traditional business model; Blue Ocean strategy; Red Ocean strategy; Guy Laliberte, Daniel Gauthier; Ringling Brothers; Innovation Management Case Study; Barnum & Bailey; Brand management; Cost control R&D; Talent acquisition; Trade offs strategic fit; Set and costume design; Mystere Alegria Quidam; Reinventing the circus

Contents: 
Circus Industry: The Traditional Business Model
Cirque du Soleil: Creating a Blue Ocean
Core Theme of Cirque’s Shows
Red Ocean vs Blue Ocean Strategy
Cirque du Soleil’s Business Model: Trade offs and Strategic Fit
The Return on Creativity
Cirque du Soleil: Sustainability Issues