Porters Five Forces
Main Aspects of Porters Five Forces:
The original competitive forces model, as proposed by Porter, identified five forces, which would impact on an organization’s behavior in a competitive market. These include the following:
• The rivalry between existing sellers in the market.
• The power exerted by the customers in the market.
• The impact of the suppliers on the sellers.
• The potential threat of new sellers entering the market.
• The threat of substitute products becoming available in the market.
Understanding the nature of each of these forces gives organizations the necessary insights to enable them to formulate the appropriate strategies to be successful in their market. Herein, we have emphasized and focused on the Auto Industry based on the Porter's analysis.
with examples such as Easy Jet online only flight booking, alliances in Hotel bookings
between the Hilton Group and Hilton Hotels Corporation as well as online flight booking
through Opodo. The last two examples show the strength of alliances and the benefits
that an integrated systems approach can bring to both the business, in terms of cost
savings, and a reduction in duplication, and to customers in terms of perceived quality
and product availability. Serve et al (2002) identify that the Internet will provide
increased price competition, increased market intelligence and a reduction in costs.
Middleton with Clarke (2001) suggest that the Internet can enhance marketing
programmes and increase promotional opportunities, distribution channels for operators
and destination marketing as well as important last minute sales. The Internet provides
new multimedia promotional opportunities directly into customer homes.
Paton & Conant (2002) analysis of Internet advertising of UK companies found that
companies operating in Service industries were 8% more likely to advertise than non
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business but also the attraction of new customers who may...
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