The Walt Disney is one of the companies that have gained popularity across the world in film and media industry. The Disney was established back in 1923 by Roy Disney to carry out operations and activities of a studio. Later, it opened up the first ever resort known as the Disney Resort in California back in 1955 before being allowed to list equities on the New York Stock Exchange Market. With the rising market value, the company gained recommendable returns before buying the Warner Bros thus forming the Warner Bros and Walt Disney. Working under synergy, the company has succeeded in meeting its competitive advantage through an application framework that can be illustrated with the aid of Michael potters five forces model as shown below.
Threat of new entry: having been in an entertainment industry, the company has since enjoyed high levels of lows of low cost barriers characterized by music and the film sector. However, the rapid change in technological revolution such has the internet has subjected the company to numerous threats leading to low costs barriers.
Buyer power: there is abundant buyers’ power to Warner Bros and Walt Disney hence limiting the switching costs for customers. Besides, the company enjoys broad market for film and media industry.
Threat of substitution: Warner Bros and Walt Disney offers varied products to the industry that ranges from movies to video games among others. As such, the company enjoys a significant margin for substitution.
Suppliers’ power: the company offers a wide range of services including hospitality facilities at the Disney resort, which gives the company an opportunity to a wide range of suppliers serving in different capacities.
Competitive rivalry: The Company features in a global entertainment industry that is flooded by a lot of competition some of which includes capitol films, Filmton and the 20th century cinema among others.
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