Pixar Five Force Analysis

MGMT330-002Strategic ManagementCase Memo – Pixar | Leslie, Leong SengIp B-A9-0024-6Alan, Leong Chon Fai B-A9-0146-1Anson, Un Kin Pang B-A9-0257-3 | Louis, ChioWengIp B-A9-0320-5Vicky, Leong Wai Kit B-A9-0334-3 |

Animation movie Industry Analysis with Porter’s 5 Forces

* The threat of rivalry: High

The movie industry is running under oligopoly. It means that this industry is dominated by few companies so that the competition level is very intense. In order to enhance the competitiveness, companies always think about how to increase the movie quality, attractiveness, new interesting story, or even lovely character. If companies fail to do so, probably resulting in customers chooses another better one.

* The threat of new entrants: Low

Since the industry is dominated by few companies: DreamWorks, Fox, Disney and etc.

Disney has already build up a very great awareness of brand and created a distinctive position in this industry. Disney has been able to grow for a long period of time, already set up a well-developed access to distribution channels. So, the entrance barriers for new comers are relatively high. This is not an easy task for new entrants to achieve success in a short period of time.

* Bargaining Power of Supplier: Moderate

Suppliers in this industry mostly related to the people with expert at animation techniques and creative film-making skills. As Disney Company is operating in a highly differential and the major customer of many of the suppliers. However, the suppliers also dominated by few animation companies. Therefore, there is a very high dependency relationship in this industry.

* Bargaining Power of buyers: High

Buyers in this industry are considered as the customers, viewers and audiences. Just like you and me. Since the main source of Disney comes from a large number of customers. Disney needs them to have a smooth operation, so the customers have certain power. On the other hand, if the price of Disney‘s movie is...