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Porter 's 5 Forces Model

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Porter’s 5-Forces Model identifies and analyzes 5 different competitive forces that shape the industry that a company is competing in and helps them determine weaknesses and strengths, which allows a company to tailor their business strategies to accommodate such problem areas. The model primarily deals with the threat of 1) competition, 2) new entrants, 3) substitutes, 4) power of suppliers, and 5) power of buyers. The threat of competition is pretty self-explanatory because it deals with the number of companies that could potentially steal market share in a specific industry or cause problems for the desired company. Because The Walt Disney Company is a conglomerate that spreads itself into many different industries, the threat of …show more content…

For example, Comcast Corporation is the closest competitor to Disney, but is still dwarfed by the sheer multinational force that Disney has behind it. It is also pretty difficult to enter the same territory that Disney inherits. However, there are smaller industries under the giant Disney umbrella that have lower entrance barriers, which may cause problems for the company in those sectors. In the hotel and resort industries, there are an increasing amount of smaller entrants that are entering the market which compete directly with Disney’s many resorts and can potentially draw consumers away. As a whole, the threat of new entrants would be ranked at a medium level because of the polarizing sides of being a conglomerate. The threat of substitutes usually pops up due to lower entry barriers and the ease of new competition crowding the market. The Walt Disney Company’s threat of substitutes is ranked at a medium level because it really depends on the specific industry that is being observed. For example, there are a number of other theme parks, cruise lines, and resorts that consumers can choose instead of one owned by The Walt Disney Company. On the other hand, Disney also owns ESPN and other exclusive television and movie rights (i.e.: LucasFilms who makes the Star Wars film and franchise) which have no direct substitute.
The bargaining power of suppliers is fairly low due to the fact that the Walt Disney Company is a conglomerate

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