Porter's 5 forces Samsung

Threat of New Entry

With the mobile industry there are always many new models of mobiles coming out and with how fast pace the market for this is. Samsung always need to update their mobile devices to successfully stay within the marketing industry – this meaning they require specialists that know about the fast-paced mobile market and what the customers desire. Similarly, they need to know where they will get the most beneficial and cost-efficient sales, ensuring that they profit on the demand of society. For example, companies like Huawei are making a name for themselves in the mobile industry which could tarnish Samsung’s reputation.

Supplier Power

Due to Samsung’s popularity and size, there is likely a lot of services who are willing to offer services to Samsung for mobile components. However, this does not reduce the power they have over Samsung. Supply chains are likely a lengthy process to complete so maintaining it is likely vital towards the production and profit process.

Buyer Power

In the mobile market, the power that buyers have tends to be lower than in other markets. This mainly being because the product holds a higher personal value to them- so they’re less likely to just get rid of it; on top of that, mobile devices are costly these days, especially in the smartphone market, thus adding to this. However, regarding changes, buyers tend to have influence over what is going to changed, updated or introduced. Companies like Samsung heavily rely on social media and other platforms to get an insight into what people think of their devices and software. If the mass-consumer audience reacts negatively to something they may be less likely to implement the feature as they’re aware that it may not do well.

Threat of Substitution

There are multiple types of substitutions to Samsung mobiles. For example, there’s large companies such as Apple and Nokia to new but rising companies such as Huawei. Samsung must be considerate of these other markets to ensure that they make the right decisions when it comes to marketing. The threat of substitution by other providers may also impact how Samsung price stuff – this being because if a consumer can get the same quality of product from a cheaper provider they’re likely to go there instead.

Competitive Rivalry

It is not unknown that the rivalry in the mobile marketplace is high; especially between top competitors such as Samsung and Apple. Even with the popularity that Samsung mobiles have gained themselves, Samsung still must take their place in the market seriously. With mobiles becoming increasingly alike implementing new ideas and features before competitors do is a difficult task that must be done to keep profit at a maximum, this especially being the case as it is a fast pace market.