NVIDIA’s Market-Creating Blue Ocean Moves: A Story of Sustained High Growth

Kim W. Chan; Mauborgne Renée; Munir Zunaira

Product #:IN-2025

Supplier:INSEAD

Discipline:Strategy

Setting:Other Regions

Details:Case (PDF) • 12 pages • 2025-01-31

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Fabrication and manufacturing

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This case examines a series of market-creating blue ocean strategic moves that have led NVIDIA to become one of the most valuable companies in the world. By introducing its Graphics Processing Unit (GPU) in 1999, NVIDIA redefined graphics and sparked the growth of the PC gaming market. By introducing a General-Purpose GPU (GPGPU) programming model and opening up parallel processing capabilities of their GPUs to a broad range of compute-intensive applications in 2006, it created a new uncontested market of accelerated computing. And in 2016, NVIDIA’s AI Supercomputer-in-a-Box brought supercomputer like processing capabilities to buyers at a fraction of the cost, paving the way for the emergence and growth of modern AI. The case focuses not on NVIDIA itself but on its strategic moves to show how specific sets of managerial actions and decisions taken for key business launches can result in superior or poor performance for an organization like NVIDIA. The case shows how a company can achieve sustained high growth, despite its initial business failure, not by focusing on the needs of the existing customers of the industry but by understanding noncustomers and transforming them into customers through market-creating blue ocean strategic moves.

Learning Objectives

1.Illustrate that there is no such thing as a perpetually excellent company. A company can be brilliant at one moment and wrongheaded at another. 2.Demonstrate that success in creating new markets is highly contingent on the specific actions and decisions managers make at key business launches. 3.Illustrate that a company can see its market value grow exponentially with a series of successful market-creating blue ocean strategic moves where profits, growth, and market confidence are created not by competing in an existing market but by making the competition irrelevant through the simultaneous pursuit of differentiation and low cost. 4.Show why companies need to pay attention to the value a new technology creates for buyers, rather than just the innovativeness of a new technology. 5.Discuss how noncustomers, not customers, hold the greatest insights for creating a new market and show how the ocean of noncustomers is often far larger than the existing customers of an industry.