This paper shows how to address technological, cultural and social transformations with empirically grounded innovation. Areas in transition such as higher education and learning techniques today bring about new needs and opportunities for innovative tools and services. But how do we find these tools? The paper argues for using a strategy of (user) value innovation that creatively combines ethnographic methods with strategic industry analysis. By focusing on unmet and emerging needs ethnographic research identifies learner values, needs and challenges but does not determine solutions. Blue-ocean strategy tools can identify new opportunities that alter existing offerings but give weak guidance on what will be most relevant to users. The triangulation of both is illustrated through an innovation project in higher education.