Answer to Question #279579 in Management for Joan

Question

B. Industry Analysis (Porters Five Forces)

• Pick-up a certain mobile phone company existing nowadays and identify the two (2) most important of the Five Forces factors that are affecting the market. Identify whether the power of the force is high/medium/low - briefly explain why
• Identify whether the force presents a threat or opportunity – briefly explain why (20 points)

Answer 1

I have selected Infinix as the mobile operator. Since its establishment in 2013, the Hong Kong-based mobile company has grown rapidly because to its creative designs and inexpensive prices. The following are the most significant influences on the mobile phone industry: i) The Threats of new entry Barriers ii) Competition among existing firms.

i)                 Threat of new entry barriers

The threat posed by new entrants into the mobile phone sector is mild. The entry barriers are low, and you don't need to put a lot of money into the market to get started. In order to maintain their market share, incumbent businesses, on the other hand, invest heavily in marketing and innovation, making it extremely difficult for any new company to achieve significant market share. Furthermore, firms must overcome several substantial challenges in order to keep their competitive advantage in the sector. They must prioritize marketing and customer experience in addition to investing in technology innovation, which is crucial for differentiation and market share. The legal systems of most countries also operate as a barrier to admission. Another important factor deterring newcomers is the level of demand, which has lately reached a halt. Stagnant demand also makes it difficult for new brands to enter the market because they will be unable to compete.

ii)                Competition among existing firms

In the smartphone sector, the degree of competition is exceedingly high. In recent years, demand has leveled off, demanding a greater focus on innovation and customer retention. Companies are spending a lot of money on research and development in order to keep their market share. As a result, leading corporations spend a significant amount of money on research and development. Samsung invests heavily on research and development. In recent years, Apple has expanded its R&D spending. In addition, while Samsung and Huawei have employed competitive pricing tactics, Apple, which is known for its premium pricing, has priced the iPhone 11 base model competitively to retain demand. As a result, sales were skyrocketing. In order to maintain their market share, Xiaomi and Oppo have maintained their prices low. Other brands, including as Infinix, are vying for market share as well.