...Porter’s Five Force Model There are some different approaches available when measuring the profitability in a market, or industry. I choose to use the model by Michael E. Porter, where the profitability potential of an industry, described as the long run return on investment, is reliant on the degree of competition in the selected industry. The five forces that Porter mentions are; threat of entry, supplier power, buyer power, threat of substitutes and industry rivalry. Threat of entry The threat of new entrants into the market segment dominated by RIM is quite high. All the established companies in the mobile industry are possible entrants to the diversified communication services industry of RIM. Although RIM has up-to-now been able to take full advantage of its technological dominance in the market , there still remains the possibility of new companies to enter using older versions of the technology in a modernized and revamped way. A recently entrant to the market is Apple corp. with its iphone. Because of the dominance of RIM in its own lucrative segment it will always face the threat from new entrants. Supplier power The bargaining power of suppliers in the manufacturing face is considerably low in this industry, for instance, processors of the same architecture used by RIM is produced by many companies such as Intel, Freescale Semiconductor, Texas Instruments, Royal Philips Electronics, Samsung and STMicroelectronics. However, as I mentioned earlier there are...
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...Research In Motion Porter's Five Force Porter’s Five Force Model There are some different approaches available when measuring the profitability in a market, or industry. I choose to use the model by Michael E. Porter, where the profitability potential of an industry, described as the long run return on investment, is reliant on the degree of competition in the selected industry. The five forces that Porter mentions are; threat of entry, supplier power, buyer power, threat of substitutes and industry rivalry. Threat of entry The threat of new entrants into the market segment dominated by RIM is quite high. All the established companies in the mobile industry are possible entrants to the diversified communication services industry of RIM. Although RIM has up-to-now been able to take full advantage of its technological dominance in the market , there still remains the possibility of new companies to enter using older versions of the technology in a modernized and revamped way. A recently entrant to the market is Apple corp. with its iphone. Because of the dominance of RIM in its own lucrative segment it will always face the threat from new entrants. Supplier power The bargaining power of suppliers in the manufacturing face is considerably low in this industry, for instance, processors of the same architecture used by RIM is produced by many companies such as Intel, Freescale Semiconductor, Texas Instruments, Royal Philips Electronics, Samsung and STMicroelectronics...
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...research in motion In the January of 2008, Research in Motion (RIM) is standing at the strategic juncture where important decisions need to be taken regarding global expansions. The biggest strategic issue it faces is to carry over yesteryears’ growth to next level through sustainable innovation at global level. Although its R&D expenditure has grown 6 times in the last four years, the ratio of R&D expenditure to sales has been halved. This ratio shows RIM is not utilizing its explosive growth to proportionately improve its technological innovations (important for sustainable revenue growth), which are the main sways of the mobile communication industry in which it is doing its business. Mobile communications industry is highly competitive being oligopolistic in nature. Gauging RIM on the Porter’s five forces model, I understand there are many a threats to RIM. The biggest threat is the Threat of Rivalry. RIM’s direct competitors have much bigger market share globally and they are spending much larger amounts (as well as R&D ratios to sales) on the R&D activities in comparison to RIM. They are also trying to convert the industry into network industry by sharing of Mobile OS (e.g. Symbian) across companies. Some of them have already expanded globally for tapping talent in emerging countries, an idea which RIM is pondering over. RIM’s Blackberry products have a product differentiation (temporary competitive advantage) of being a smartphone originally built for busy professionals...
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...or she communicates, takes pictures, reads, or just passes time. Apple took smartphones to a new level, creating something sleek and innovative. Jobs created a cool new music player for “cool” people. The company established a high-cost narrow-focused market segment (Baltzan, 2011). The iPod and Apple would end up with a high perceived-value that meant, while the consumer always paid a premium price, he or she also always received an operationally superior product and great customer service. Applying Porter’s Five Factors Model, Apple demonstrates its superiority in the smartphone/tablet industry. While the company does not dominate the global market, it does dominate in profits. As a result of large profits, Apple has more financial leverage in negotiations with suppliers and manufacturers. Rivalries and substitutes are generally not an issue among existing Apple device users. Brand loyalty is extremely strong among Apple users. The examination of Apple through Porter’s lens reveals a company that is sustainable. Do you agree or disagree that Apple’s iTunes, iPhone apps, and iPad apps give the company a competitive advantage? Be sure to justify your answer. I agree that Apple’s iTunes, iPhone apps, and iPad apps (App Store) do give Apple a competitive advantage. However, to understand why, I believe you have to understand the success of the Apple brand and its products. Steve Jobs first created a competitive...
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...Apple Case Update: Apple Aphorisms November 27, 2012 Executive Summary Apple Computer, Inc. is ranked 17th on the Fortune 500 list, with Hewlett Packard, IBM and Dell, some of Apple’s closest competitors, ranking 10th, 19th and 44th respectively (www.cnn.com). With such fierce competition for market space, Apple has lived up to its name in becoming and maintaining the status of being the Apple of the consumer’s eye (pun intended). Apple maintains a competitive and first-mover advantage by handily balancing Porter’s Five Forces Model and executing a supreme customer relationship management (CRM) strategy, as chronicled in an example found in Baltzan’s Business Driven Information Systems (2012). This paper will apply Porter’s model against Apple’s information management practices, and will update case information with new product lines and lessons learned all under the guise of Apple adages. The Big Apple (Taking a Bite out of the Market) No research is required to determine that Apple has a competitive edge in its market space. Just take a peek into an Apple store or scan a street corner before an Apple product makes its debut and you’ll see a melting pot of consumers who faithfully honor Apple like a religion. Apple garnered this legion of followers by morphing from a PC provider to an iPod, iPhone and iPad provider, giving Apple a jump on the competition as the first-mover for these digital devices. Being first-to-market with entertainment and communication...
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...* In determining the industry's competition; Michael Porter's five forces of the outside- in business unit strategic model elucidates an analytical part in deciding Blackberry's competitive structure of the industry. It helps them see that their Bargaining Power of Suppliers could increase, due to their eroding market share, which makes them a company with great credible threats if they decide on forward continuity. This problem was evident when BlackBerry hassled to get a fundamental application for the launch of the Z10. Their Rivalry Among Competitors had begun to soar as Apple and Samsung had secured more than half of the Smartphone market (Bernstein, 2012), all because of their low product differentiation there posing a threat to their ability to make a profit. Their Bargaining Powers of Buyers however, has proven that the large numbers of competitors with other simpler products helps them demand for a better quality and service thus helping them remain in the market only with a threat of losing buyers if their product quality does not increase. Decreasing their Threat of Substitute in the mobile industry where developing a wristwatch that will perform the same functions as a Smartphone, are potentially replacing handheld smart phones out of the market- thus giving them a greater chance to raise their product prices and earn greater profits and having the ability of satisfying customers needs effectively. Wherefore, a market flooded with substitutes, will narrow profit...
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...Case Analysis On Apple Incorporation By Vikram Kataria Submitted To: Dr. Justin C. Matus MBA 591 Introduction The firm started off as “Apple Computer”, best known for its Macintosh line of computers in the 1980s and 1990s. Despite a strong brand, rapid growth and high profits in the late 1980s, Apple nearly went bankrupt in 1996. Steve Jobs took over as CEO again in 1997 after being forced out of the firm in 1985. “Apple Computer” was renamed “Apple Inc.” to reflect the firm’s expansion into consumer electronics market with innovative non-PC products starting in the early 2000s. 1. Various revolutionary products such as the iPod, iPhone and iPad were introduced into the market, gaining a cult-like following behind the brand, with exponential growth and share price rising more than 15-fold since 2003. 2. Today, Apple stands as a global technology powerhouse, surpassing its major competitors, including Microsoft, to become one of the world’s most valuable companies. Current Business Strategy Apple adopts a differentiation strategy with its distinctive marketing campaigns that position itself as a hip alternative to other brands in the industry. Despite being a premium brand that is capable of commanding high price margins, Apple is still able to undercut its competitors pricing with the latest iPad 2 release by leveraging its balance sheet and its position as one of the largest buyers to secure components at low prices. This further gives Apple a competitive...
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...over 1.4 million bicycles – an increase of 16.6% on 2011/2012; • Imports for adult bikes increased 21% • Children’s bike imports decreased 7% (Source: http://www.bikeoz.com.au/index.php/news/67-bicycle-sales-hits-new-high-as-children-get-left-behind) A report released by the Prevention Research Collaboration of the University of Sydney has found: • Cycling in Australia is increasing gradually resulting in: o Cleaner cities o Less congested cities o Less stress on public transport systems o More active healthier population o Reduction in greenhouse gas emmisssions o Reduction in rate of obesity • Cycling offers commuters o Opportunity to say time and money o Chance to avoid stress of traffic jams, late trains, and crowded buses o Ability to incorporate physical activity into their daily routine • Cycling provides multiple health outcomes Recognising these benefits, Australia’s National Cycling Strategy aims to double the number of Australian cyclists by 2016, and The City of Sydney Cycle Strategy and Action Plan 2007-2017 aims to increase the number of bicycle trips made in the City of Sydney, as a percentage of total trips, from less than two per cent in 2006 to five per cent by 2011, and to 10 per cent by 2016. (Source: http://sydney.edu.au/medicine/publichealth/preventioresearch/news/Cycling%20to%20work%20in%20Sydney%202001-2011%20-%20final%20for%20website%20(2).pdf) Unfortunately, the data obtained from the Census...
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...Five Forces Analysis of the Video Game Industry The video game industry is the economic sector involved with the development, marketing and sale of video and computer games. It includes video game consoles, game software, handheld devices, mobile games and online games. The video gaming industry has been growing exponentially in recent years with Sony, Microsoft and Nintendo competing for the higher profits in the market. This essay will analyze each of the five forces acting on the industry: threat of new entrants, threat of substitute products or services, bargaining power of buyers, bargaining power of suppliers, and the competitive rivalry among existing firms. Then it will be determined if the video game industry is still an attractive industry for Sony. The video game industry has high entry barriers because of its high research and development costs, and capital investment needed to start a business in the console industry. The cost required to develop and manufacture a product that could be a decent competitor in this market is too great for a non-established company in this industry. The technology that is needed to be successful is too advanced for new competitors to achieve. For this reason, the threat to Sony, Microsoft and Nintendo of new entrants, was not very high in 2008. Additionally, Sony’s PlayStation, Microsoft’s Xbox, and Nintendo’s gaming systems were very well established names in the industry. The prestige of these products was so strong that it...
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...R&D 7 5. Marketing 7 1) Evolution of Dyson in the market 7 2) Turnover 8 3) Differentiation Strategy 9 4) Focus Strategy 10 5) Cost Strategy 10 6. Innovation 11 1) The innovator’s challenge 11 2) Fast transition from concept to 3D 11 3) Rapid prototypes from design data 12 4) Computer simulation boosts design accuracy 12 5) Protecting their innovations 13 7. Analysis 13 1) Porter’s Five Force Model 13 Existing Rivalry 14 Bargaining Power of Supplier 14 Potential Entrants 14 Threat of Substitutes 14 Bargaining Power of Buyer 15 2) SWOT Analysis 15 Strength 15 Weakness 15 Opportunity 15 Threat 16 1. Abstract In 1978, James Dyson noticed that the air filter of the workshop where the spraying finishing operations on Ballbarrow models was constantly obstructed powder particles (like a vacuum cleaner bag is blocked by dust). He has designed and manufactured industrial cyclone tower, which removed the powder particles by exerting a centrifugal force 100 000 times the force of gravity. The same principle could he operate in a vacuum? James Dyson began to work. Five years and 5,127 prototypes later, the first Dual Cyclone bagless Vacuum cleaner was created. Then a legend of Dyson was come into being. He cooperated with a Japanese companies to developed his inventor to the Japan and later also in United Kingdom. With the help of some friends he made his own company Dyson, and invented different kinds of electricity like vacuum, hand dryer, washing...
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...analysis…………………………………………………………………………………4 6. Sony’s Orientation……………………………………………………………………………………………………6 7. Sony's Competitive Advantage Analysis……………………………………………………………………7 8. Porter's generic strategies………………………………………………………………………………….......8 9. Porter's competitive Forces………………………………………………………………………………........9 10. Marketing Mix………………………………………………………………………………………………………..11 11. Sony’s Product Mix and Product Line……………………………………………………………………..12 12. Price Mix………………………………………………………………………………………………………………..14 13. Sony’s Promotion Mix………………………………………………………………………………………......17 14. Sony‘s Place Mix…………………………………………………………………………………………………….18 15. Sony‘s Distribution Channels………………………………………………………………………………….19 16. Sony Corporation's Success………………………………………………………………………………….…20 17. SWOT analysis…………………………………………………………………………………………………........22 18. Recommendations to maintain Competitive Advantage…………………………………….…..24 19. Conclusion………………………………………………………………………………………………………….….25 20. Bibliography / References………………………………………………………………………………….....27 Introduction: Sony is a leading corporation primarily operating in electronics. They are leading manufacturers in electronic goods. Sony holds a great quality and technological leadership in the market. Sony products are in the fields of entertainment, communication devices, laptops, video games, motion pictures, music, personal computers, digital cameras, robots and other financial services. This report brings an overview about the principles of marketing and...
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...Introduction. In recent times the sports sectors have began to see the importance of strategic marketing and planning. Researchers have said that if strategic marketing activities are not improved sports would not be able to endure the competition from the entertainment industry. This purpose of research is to: (A) Evaluate the conditions of the Marketing environment of Nike INC as a sports equipment company (B) Evaluate the recourse capability of Nike INC using appropriate analytical tools, highlighting its thresholds and unique resources and core competences (C) Evaluate the strategic fit of Nike INC using the analysis gather highlighting its strength and weakness. Company’s Profile. Nike INC is a sport Equipment company, It was founded on the 25th of February 1964 by Bill Bowerman as at then it was known as Blue Ribbon Sports. Its named was official changed on the 30th May 1978 to Nike INC. It is said that Bill Bowerman developed his interest in starting up a business while in Stanford. He believed his business would grow because as at then most Sport Shoes companies spent a fortune on labour by cost by manufacturing their Athletic Sports Footwear in countries like the USA were labour cost were high. He was convinced that by out sourcing production to Japan where labour is cheaper, Blue Ribbon prices would be cheaper than its contributor and thus it break into the Athletic Foot Ware industry and this was the beginning of the company which later became Nike INC. ...
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...asset management, retail strategy, and product differentiation. With these advantages, Apple was saved from bankruptcy and has gained a positive reputation, more customers, and large profit margin. The struggle of Apple incorporate in the PC industry was mostly due to the company’s inability to utilize Porter’s Five Forces. Porter’s Five Forces analysis is a powerful tool for understanding a company competitive position in the industry. The first three CEOs of Apple (Scully, Spindler, and Amelio) failed to address these forces and led the company to the edge of bankruptcy, which largely contribute to the reason why Apple’s PC industry suffer more than its iPod business. Intensity of Competition The present of several large PC manufacturers such as IBM, Dell, Hp, Acer, etc. substantially increases the intensity of competition. Additionally, when the Windows operating system combined with an Intel processor, it created a new standard known as “Wintel” which dominated the PC industry. This trend turned every personal computer into a commodity, and the competition turned into a battle of lower prices, which greatly severe the profit of all companies. Power of Buyer There are five categories of buyers, include...
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...your chosen market and secondly offer expert advice to attain business success in that market. CONTENTS- 1. Introduction. 2. View of Brazil’s economy. 3. Brazil as a BRICS Economy. 4. Market for smart phones in Brazil. 5. Using the porter’s five forces to analyse the market for smart phones in Brazil. 6. Competitors existing in the market. 7. How to enter the market. 8. Constraints to success for the company (using PESTLE model). 9. How to achieve a sustainable competitive advantage. 1. INTRODUCTION The Cost (this involves the legal cost, corruption, lack of infrastructure), Benefits (size of the economy or economy growth),Risk (political-social unrest, economic mis-management) analysis has been used to analyse the favourable emerging market in Latin America which is Brazil. The main reasons for choosing this market will discussed in details. 2. OVERVIEW OF BRAZIL’S ECONOMY The chosen market is BRAZIL which is an emerging market and also the largest of the Latin American nations and the second largest in the western hemisphere with an average annual GDP growth rate of over 5%. In one of my findings, Brazil is expected to become one of the five largest economies in the world in future. As at 2011 according to Forbes, “Brazil was ranked the 8th largest number of billionaires in the world”. Brazil is the sixth largest economy by nominal GDP in the world and also ranked 10th ease of doing business rank...
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...analytical tools, including SWOT (Appendix A), segment analysis (Appendix B), competitive strength assessment (Appendix C) and financial ratios (Appendix D). Overall, Nintendo has several opportunities and strengths of which they can take advantage to stay competitive in the market. However, their competitive threats and weakness pose significant financial challenges for the firm. Based on our analysis, we considered the following alternatives: 1. Continue to focus on the existing marketing strategy by differentiating itself from the competition; 2. Expand the video game product line to include games with improved graphics and functions for the current Wii in an effort to expand their customer base; 3. Invest aggressively in research and development to create a new video game console that takes into account the requirements for both the non-gamer and traditional gamers; and 4. Continue to differentiate itself from the market by expanding into gaming through social media and mobile devices. For Nintendo to maintain a...
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