Blockbuster Case Study
1. Analyze Blockbuster's current position (based on its brick-and-mortar business model) using Porter's 5-forces model. What are the conclusions of your analysis?
In Porter's 5 forces model, the five underlying forces for an industry's structural attractiveness are the barriers to entry for new competitors, the intensity of rivalry among existing competitors, the threat of substitute products or services, the bargaining power of suppliers, and the bargaining power of buyers. In analyzing Blockbuster's business model and current position, it is evident that it faces issues in all five areas.
Barriers to entry
In the brick and mortar movie rental industry, Blockbuster is clearly the leader. With the merger of Hollywood Video and Movie Gallery, that leaves on two major players in the brick and mortar movie rental industry. Essentially, this has created many barriers for traditional mom-and-pop video stores to maintain consistent revenues or expand and open new stores,......
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