Swot analysis , Pest Analysis and Porter's 5 force model


Published on

Published in: Business, Technology
  • Be the first to comment

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Swot analysis , Pest Analysis and Porter's 5 force model

  1. 1. ANALYSIS OF TELEVISION AND SOFT DRINKS INDUSTRY Submitted To: Ms. Japneet Kaur Submitted By: Shikha Shivang Shobitash MBA-HR
  2. 2. What is an industry? An industry is a group of manufacturers or  businesses that produce a particular kind  of goods or services.  For example-television industry, tourism industry, soft drinks industry, fish industry, food processing industry etc.
  3. 3. Classification of industries Industries can be classified in a variety of ways. At the top level, industry is often classified into sectors: Primary or extractive, secondary or manufacturing, and tertiary or services. Some authors add quaternary (knowledge) or even quinary (culture and research) sectors. Over time, the fraction of a society's industry within each sector changes.
  4. 4. Classification of industries Industries can be classified in a variety of ways. At the top level, industry is often classified into sectors: Primary or extractive, secondary or manufacturing, and tertiary or services. Some authors add quaternary (knowledge) or even quinary (culture and research) sectors. Over time, the fraction of a society's industry within each sector changes.
  5. 5. Sectors Definitions Primary This involves the extraction of resources directly from the Earth, this includes farming, mining and logging. They do not process the products at all. They send it off to factories to make a profit. Secondary This group is involved in the processing products from primary industries. This includes all factories—those that refine metals, produce furniture, or pack farm products such as meat.
  6. 6. Tertiary This group is involved in the provision of services. They include teachers, managers and other service providers. Quaternary This group is involved in the research of science and technology. They include scientists. Quinary Sector Some consider there to be a branch of the quaternary sector called the quinary sector, which includes the highest levels of decision making in a society or economy. This sector would include the top executives or officials in such fields as government, science, universities, nonprofit, healthcare, culture, and the media.
  7. 7. Television industry • In the last five years color television industry (CTV) has witnessed drastic changes in the intensity of competition. • Exchange schemes, free gifts, price offs, prizes, deferred payment schemes and other incentives as promotional tools have been deployed by the players, which certainly have made the market, vibrant witnessing a new scenario with a new market profile. The entrenched position of the Indian market leaders in CTVs’ like
  8. 8. Television industry (continued….) Videocon, BPL and Onida have been challenged by MNCs such as LG, Samsung, Sony, Philips, AIWA, Akai, Panasonic, Sansui and Sharp; some in a perceptible way, others threatening to do so. • The industry is going through turbulent transformation. Companies are relooking at their strategies and are desperate for growth. • A major factor contributing to the growth has been availability of consumer financing schemes. • The industry has seen environmental factors operating in the Industry to provide a basis for devising Strategy. 
  9. 9. Future prospects of television industry • 4K and 8K technology 4K UHD is a resolution of 3840 pixels × 2160 lines (8.3 megapixels, aspect ratio 16:9) and is one of the two resolutions of ultra high definition targeted towards consumer television, the other being 8K UHD which is 7680 pixels × 4320 lines (33.2 megapixels). 4K UHD has twice the horizontal and vertical resolution of the 1080p HDTV format, with four times as many pixels overall.
  10. 10. Future prospects of television industry Smart television A smart TV, sometimes referred to as connected TV or hybrid TV, describes a trend of integration of the Internet features into television sets and set-top boxes, as well as the technological convergence boxes. The devices have a higher focus on online interactive media , Internet TV, over-the-top content, as well as on-demand streaming media, and home networking access, with much less focus on traditional broadcast media than traditional television sets and set-top boxes. Similar to how the Internet, Web widgets, and software applications are integrated in modern smart phones.
  11. 11. Soft drinks industry Soft drinks are a kind of beverage that do not contain alcohol as the active agent and hence are referred to as 'soft' drinks, in opposition to 'hard' which means alcoholic beverages. There are mainly two kinds of soft drinks, one that is carbonated and one that is non-carbonated. They are believed to taste best when consumed chilled. The different types of soft drinks include colas, flavored water, carbonated water, sweet iced tea, fruit drinks, carbonated soft drinks, diet soft drinks, and fruit punch.
  12. 12. Soft drinks Raw materials used in soft drinks:• Water(90-95%) • Artificial flavors • Acids(citric acid, phosphoric acid etc.) • Natural flavors • Caffeine • Carbon dioxide • Color • Sugar
  13. 13. Future prospects of soft drinks industry • The Indian soft drinks market generated total revenues of $3.8 billion in 2010, representing a growth rate of 11% for the period spanning 2006-2010. • Carbonates sales proved the most lucrative for the Indian soft drinks market in 2010, generating total revenues of $1.9 billion, equivalent to 50.5% of the market's overall value. • The performance of the market is forecast to decelerate, with an anticipated CAGR of 9.1% for the five-year period 2010-2015, which is expected to lead the market to a value of $5.9 billion by the end of 2015.
  14. 14. Future prospects of soft drinks energy(continued…..) • Soft drinks consumption has reached saturation point. Therefore ,a decline is expected to follow in the growth rate of soft drinks industry. • People are becoming more health conscious now-adays. They are shifting towards natural fruit and vegetable juices.
  15. 15. Major players of soft drink Industry
  16. 16. Pepsi Pepsi was first introduced as "Brad's Drink"[2] in New Bern, North Carolina, United States, in 1893 by Caleb Bradham PepsiCo is one of the largest food and beverage companies in the world. Its products include a variety of salty, sweet, and grain-based snacks as well as Csds and non-Csds. the company is responsible for the manufacturing, marketing, and sales of these goods. it has 18 brands in its portfolio. It headquartered in new york
  17. 17. Dr Pepper Snapple (DPS)  The drink was created in the 1880s by Charles Alderton of Waco, Texas and first served around 1885.  The Dr Pepper snapple Group is a leading integrated brand owner, bottler, and distributor of soft drinks in the united states, Canada, and Mexico.  the company has 15 brands  headquartered in Plano, texas
  18. 18. Major players of tv Industry
  19. 19. Samsung  Samsung was founded by Lee Byung-chul in 1938 as a trading company  Samsung Group is a South Korean multinational conglomerate company  Headquartered in Samsung Town, Seoul
  20. 20. Videocon  Videocon is an Indian multinational industrial conglomerate headquartered in Gurgaon,  The group has 17 manufacturing sites in India and plants in Mainland China, Poland, Italy and Mexico  It is also the third largest picture tube manufacturer in the world.  The group is a US$5 billion global conglomerate.
  21. 21. Onida  Onida was started by G.L. Mirchandani and Vijay Mansukhani in 1981 in Mumbai  Onida is an electronics brand of Mirc Electronics, based in India  Onida is well known in India for its colour CRT televisions
  22. 22. Panasonic  The company was founded in 1918  Panasonic is the world's fourth-largest televisionmanufacturer by 2012 market share  It is a Japanese multinational electronics corporation headquartered in Kadoma, Osaka, Japan.
  23. 23. LG  Lucky Goldstar is a South Korean multinational conglomerate corporation  LG Corp. founder Koo In-Hwoi established Lak-Hui Chemical Industrial Corp. in 1947  Its headquarters are situated in the LG Twin Towers building in Yeouido-dong.
  24. 24. Sony  Sony, is a Japanese multinational conglomerate corporation headquartered in Kōnan Minato, Tokyo, Japan  Sony found its beginning in the wake of World War II. In 1946.  The company is one of the leading manufacturers of electronic products for the consumer and professional markets  Sony is ranked 87th on the 2012 list of Fortune Global 500.
  25. 25. Other players  Onida  Mitashi  Haier  JVC  Philips  Sharp  Sansui  Akai  Daenyx
  26. 26. Competition
  27. 27. Competition among players
  28. 28. SWOT Analysis
  29. 29. S trengths What advantages does our company have? What do we do better than anyone else? What unique or lowest-cost resources do we have access to? What do people in our market see as our strengths? What factors mean that we "get the sale"?
  30. 30. W eaknesses • What could we improve? • What should we avoid? • What are people in our market likely to see as weaknesses? • What factors make us lose sales?
  31. 31. O pportunities • Where are the good opportunities facing us? • What are the interesting trends we are aware of? Useful opportunities can come from such things as: • Changes in government policy related to our field. • Changes in social patterns, population profiles, lifestyle changes. • Local events.
  32. 32. T hreats • What obstacles do we face? • Are the required specifications for our job, products or services changing? • Is changing technology threatening our position? • Do we have bad debt or cash-flow problems? • Could any of our weaknesses seriously threaten our business?
  33. 33. Example:Coca-Cola Swot Analysis Strengths  Weakness Significant focus on The best global brand in the world in terms of value ($77,839 carbonated drinks Undiversified product billion) World’s largest market share in portfolio beverage High debt level due to Strong marketing and advertising acquisitions Most extensive beverage Negative publicity distribution channel Brand failures or many brands Customer loyalty Bargaining power over suppliers with insignificant amount of Corporate social responsibility revenues
  34. 34. Coca Cola Swot Analysis Opportunities  Bottled water consumption growth Increasing demand for healthy food and beverage Growing beverages consumption in emerging markets (especially BRIC) Growth through acquisitions Threats  Changes in consumer preferences Water scarcity Strong dollar Legal requirements to disclose negative information on product labels Decreasing gross profit and net profit margins Competition from PepsiCo Saturated carbonated drinks market
  35. 35. PEST Analysis • This analysis is essential for an organization before beginning its marketing process • Consists of internal environment and external environment Pest Break Up: • Political • Economic • Socio Cultural • Technological
  36. 36. Political Factors • This is the most important influence on the regulation of any business. – How stable is the political environment? – Influence the Government Policy / Law on your business – Government’s position on Marketing Ethics – Government’s view on culture under religion
  37. 37. Economic Factors • Government outlook towards – Bank Financing – Interest Rates – Exchange Rate Mechanism – Incentives for Exports – Restrictions for Imports – Inflation – Labor Policies
  38. 38. Socio-Cultural Factors • Demographics • Distribution of Income • Social Mobility • Life Style Changes • Consumerism • Educational Levels
  39. 39. Technological Factors • Advantage of Technology – In terms of Economies of Scale • New Discoveries & Innovations • Speed & Cost of Technology Transfer • Rate of Obsolescence
  40. 40. Role of PEST • Helps Assess the market including Competitors from the stand point of a Particular Business. • PEST is relevant for any type of Business large, small & medium. Case Study On McDonalds Follows this Slide
  41. 41. POLITICAL CHALLENGES Health and Safety Guidelines  Fast food consumption has been shown to increase calorie intake, promote weight gain and elevate risk for diabetes criticised for caloric content, trans fats and portion sizes  Ecological/environmental issue  One of the largest consumers of paper products in the US leading to millions of pounds of food packaging waste littering roadways, clogging landfills and spoiling quality of life.
  42. 42. ECONOMIC CHALLENGES   Low set up costs leading to rapid expansion keeping the prices low for the customers. Franchising facilitates set up McDonald's corporation provides financing assistance and training for new franchise owners to manage cash flow and keep businesses profitable
  43. 43. SOCIAL CHALLENGES Health fears Customers now opting for more healthier options like SUBWAY which offers more variety for health conscious customers. Emphasis on food safety
  44. 44. TECHNOLOGICAL CHALLENGES  Streamlining of processes to improve efficiency through technology enhancements such as FPI's Help Desk Service, network and application consolidation and other technology implementations, operations of the company are greatly improved  Marketing done by means of television advertisements.  Implemented technology to improve supply chain management
  45. 45. Porter's Five Force Model
  46. 46. Porter’s Five Forces Chart
  47. 47. Importance of The 5 Forces Measure and monitor strategy effectiveness Industry analysis : 1) Industry relevance 2) Industry players 3) Industry structure 4) Future changes What strategy to use? Basic knowledge of business strategy & forces that influence the decision making Strategize : * Competitive advantage * Cost advantage * Market dominance * New product development * Contraction / Diversification * Price leadership * Global * Re-engineering * Downsizing * De-layering * Restructuring How to deal with competition?
  48. 48. Threats of New Entrants The easier it is for new companies to enter the industry, the more cutthroat competition there will be. Factors that can limit the threat of new entrants are: 1. 2. 3. 4. 5. 6. How loyal are the end users in this industry? How troublesome or hard is it for the end users to switch and use another product? Does it require a large seed capital to enter this industry? Do entries to this industry regulated by government? How hard is it to gain access to the distribution channels? How long does it take for new staff to acquire the necessary skills to do the work?
  49. 49. Threat of Substitutes Threats of Substitute in the Porter’s theory actually means goods and services that does similar functions  How many close substitutes are available?  How pricey are the substitutes?  What is the perceived quality of the substitutes?
  50. 50. Intensity of rivalry among established firms 1. 2. 3. How many close competitors exist in the industry? What are the sizes of your close competitors? What is the industry structure? Is it a fragmented, consolidated, oligopoly or monopoly industry? 4. What is the current industry growth rate?
  51. 51. Bargaining power of Customers How many companies are there for the buyer to choose from? Are the buyers buying a huge volume? Do we depend only on a few buyers to sustain our sales? How hard is it for the buyers to switch and use a competing product? Do the buyers have the capacity to enter your business and produce the goods themselves?
  52. 52. Bargaining power of Suppliers Are there substitutes for our suppliers’ products? Do our suppliers serve multiple industries? Does the total industry revenue accounting for only portion of the supplier’s total revenue? Do we have high switching cost to use another supplier? Do suppliers have the capacity to enter in our business? Does our company capable to enter the supplier’s business?
  53. 53. Porter's 5 Force For Sony TV    Threats of new Entry (Low): Electronic industry needs huge amount of capitals. High scale economy and constant innovation is another barrier to a new entrant. Moreover, the government policy acts as entry barrier for a new company. Bargaining Power of Buyer (High): For Sony Corp. product the bargaining power of buyer is very high as there is almost no switching cost from one brand to another. And the information technology provides the customers with wide range of alternatives. Bargaining Power of Supplier (Low): Sony has a global band of suppliers giving the suppliers no upper hand (bargaining power) over Sony. Moreover suppliers are comparatively small entity than Sony so suppliers have weak bargaining power. Sony usually negotiates directly with its supplier to obtain high quality product in low price.
  54. 54. Porter's 5 Force For Sony TV   Threat of Substitute Products (Low): Sony’s varied range of products has no substitute or a very few that seems to be obsolete or have on foot out of the door. Thus the possibility threat of substitutes is moderately low. Considering that Sony has built a good reputation and strong customer loyalty, it effectively positions the company’s products against product substitute to some extent; this is a surplus for the company. Intensity of Rivalry (High):Industry rivalry is high due to relatively intense competition and high exit cost. It is also largely due to the numerous and equally balanced competitors in the markets, generally short product life cycle as well as high R&D, fixed and storage costs. The growth is slow and thus the intensity of competition.
  55. 55. Thank You Any Queries?