This happens with markets all the time, actually. Blue Ocean Strategies are commonplace, not well understood, but very important. Volatile markets follow a simple pattern of growth and decline:
Value Innovation -> Market Growth -> Segmentation -> Decline -> Crash
To break what happens down at each stage...
Value Innovation - A Blue Ocean product is introduced that changes the market. It makes the market more appealing to people inside, outside, and/or on the fringe of the market.
Market Growth - The market, revitalized, grows rapidly. New, returning, and/or existing customers take new interest in it, and sales surge.
Segmentation - Products begin to specialize to match the tastes of sub-groups within the market. The values that drive the market are ugraded incrementally in the process to suit those differing tastes. As segmentation occurs, parts of the market are alienated and move to the fringes or depart entirely.
Decline - As segmentation grows heavier, costs of pandering to specific tastes increase. The expense of producing goods versus the revenue they earn begin to approach zero, and the market begins to shrink. Prices of products tend to rise and quality tends to drop as this happens, further scaring off customers.
Crash - If no Blue Ocean Strategy revitalizes the market, the segmentation eventually leads to a market crash. This happens when expenses outweigh revenues for the vast majority of players, resulting in mass market exodus. Many customers also depart the market when this happens.
The pattern for a non-volatile market (such as tea kettles, which tend to be built to last and are difficult to make sustaining innovations to), goes more like this:
Value Innovation -> Market Growth -> Market Saturation -> Crash
Market Saturation is basically when the product is owned by as many people as are going to buy it. The resulting crash is from no new customers.
Sky Render - Sanity is for the weak.
