This achievement is very simple to earn.
It can be done on a stage that's open on all sides or on a stage that's partially open. All you have to do, with any character, is to knock them out of the ring. You can't beat them on the stage and then watch them leave the ring. You need to punch, kick, or throw them out of the ring while they still have enough life. If you do this successfully, the achievement will be earned the moment you earn what's called a Ring K.O. This can be done on any difficulty setting with any character you chose, but if you are having a hard time, just set the difficulty setting to Very Easy and then play on a stage that is quick enough to take them off the stage and onto the outside.
Have fun and good luck! If there is a problem with my solution and you deicde to submit a negative note, please comment why and I'll amend my solution as best as I can. Thanks!
Update: Here's a nice tip from Pure Vapour 420 on how to earn this achievement:
"On very easy i picked Wolf Hawkfield and as soon as the round begins hold towards opponent and keep pressing B to kick worked 1st try...(just make sure the stage is open or breakable)"