STRATEGY

MANAGEME
NT
Arun Karthik
Aslam
Loganathan
 Porter's Five Forces

Buyers Power Suppliers Power

Competitive Rivalry

Threat  Threat
of  of 
New Entrants  substitute
Porter's Five Forces
INTRODUCTION
• The iPhone is a line of touchscreen-
based smartphones designed and marketed
by Apple Inc. 
• That use Apple's iOS mobile operating
system. 
• The first-generation iPhone was announced
by Apple co-founder Steve Jobs on January 9,
2007. 
• Since then Apple has annually released new
iPhone models and iOS updates. 
• As of November 1, 2018, more than 2.2 billion
iPhones had been sold.
Bargaining Power of
Buyers
•Buyers’ strong power is based on the following
external factors:

•Low switching cost (strong force)

•Small size of individual buyers (weak force)
•High buyer information (strong force)

•This external factor enables buyers to exert a strong

force on Apple and other brands
 Bargaining Power of Supplires
•Suppliers have a weak bargaining power based on the following external
factors:

•Moderate to high number of suppliers (weak force)

•Moderate to high overall supply (weak force)
•High ratio of firm concentration to supplier concentration (weak force)

•This external factor reflects the presence of a small number of big

companies like Apple and Samsung, in contrast to a larger number of
medium-sized and big suppliers.
 •In Apple’s case, new entrants exert a moderate force
based on the following external factors:

•High capital requirements (weak force)

Threat of new •High cost of brand development (weak force)
•Capacity of potential new entrants (strong force)
entrant
•These examples show that there are large companies
that have the potential to directly compete against
Apple Inc.
Threat From Substitute

•In Apple’s case, substitutes exert a weak force based

on the following external factors:

•Moderate to high availability of substitutes

(moderate force)
•Low performance of substitutes (weak force)
•Low buyer propensity to substitute (weak force)

•This part of the Five Forces analysis shows that

Apple does not need to prioritize the threat of
substitution, specifically in management decisions in
business processes like marketing, market
positioning, and product design and development.
Competitive  Rivalry
•Apple’s case, this influence is based on the following external factors:

•High aggressiveness of firms (strong force)

•Low differentiation of products (strong force)
•Low switching cost (strong force)

• Moreover, in terms of product differentiation, available products in the market are generally
similar in fulfilling specific purposes. For example, many popular apps are available for Android
and iOS devices, and cloud storage services from different companies are available to iOS users. 
 Click to add text

Porter's Five Forces

INTRODUCTION
• Hotel Saravana Bhavan is the largest South
Indian restaurant chain in the world

• Founded in 1981 with ₹5,000 capital

in Chennai Tamil Nadu India.

• They have more than 39 locations in India (30

in Chennai) and 87 across several countries in
Southeast Asia, Australia, New Zealand, the Middle
East, Africa, Europe and North America.
Bargaining power of
Buyers

• Porter said that more the service become

uniformed consumers find many options
to chose
• At this point Amya Lakes famous loyalty
card remains the most successful
customer maintenance strategy that
drastically increases the profitability of
their business, also by taking care of
customer needs
Bargaining Power of Suppliers
• This force stands for the control of suppliers towards hotels
•  By having number of suppliers as an option and also by bargain improved
promotional prices that small individual hotels are unable to compete will enable the
control over the suppliers. 
•  They have chain of suppliers to supply other main materials.
 Threat Of
Substitute
• There is no major threat of substitute products specific to
a hotel’s product and service.
Threat of New Entrants
• This influential force has an immense impact on the small ordinary Hotels, Restaurants, bakers,
Guest Houses and motels etc.
•  Therefore, it possesses a tough obstacle for new companies who wish to enter in to the
hospitality industry.
• GST
Competitive Rivalry

• Having many competitors in the market

for the same industry which provides
uniformly neat service make little control
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over the condition
•  Where suppliers and buyers have the
power to choice with whom they need to
deal with, if they do not get a good deal.
•  Saravana Bhavan is one of the chain
hotels having its own customers in the
market with other competitors by
providing better service and value
additions to its customers.
Porter's Five Forces
 INTRODUCTION

•Netflix is a US-based internet streaming media provider founded by Reed

Hastings and Marc Randolph in 1997.

•It originally started with providing DVD-by-mail service in North America and
now provides digital streaming with services available worldwide.

•Although Netflix is the most popular online subscription service for

streaming entertainment in the world
 Power of BUYERS

•The power of viewers will

continue to rise because of the
increasing number of streaming
services being launched.
•The power of buyers cannot be
underestimated here
 •Traditionally, cinemas want an exclusivity window of up to
Power of 90 days before moving onto on demand streaming
services.
Suppliers •Suppliers are contracted with Netflix through Licensing
Agreements. Once the agreement expires, a supplier may
switch to a new/alternate service provider 
Threat Of New Entrants 
•Major organizations such as Apple,
Disney, HBO and Brit box (BBC and ITV)
are either launching or have recently
launched their new streaming services.

•Threat of new entrants is a very real and

serious issue for Netflix with an increasing
number of organizations deciding to
launch similar services with their own
content.

•Netflix works on a high economy of scale

with high product variety, maintaining
low cost and increasing profit. New
entrants with low investment capital are
less likely to enter this market
Theater of
Substitute
• Certain customer segments still tend to rely
on substitutes like Satellite and Cable TV,
DVDs and Rentals, and Movie Theatres for
entertainment. Customers will continue to
rely on television to watch live shows which
get broadcasted on specific channels and
on theatres to watch newly released
movies.
 Competitive Rivalry

•Highly competitive environment 

•• OTT – HBO GO/Showtime 
•• CBS All Access 
•• Pay TV – On Demand 
•• Hulu Plus, Amazon TV 

•Not all competitors are subscription services 

•• YouTube 
•• Crackle – Free service similar to Netflix that also has
original web content