Industry Analysis of Case Study Paper
Number 4
Industry Analysis
The Ultimate Fighting Championship is categorized, based on the North American Industry Classification System, as part of the “Promoters of Performing Arts, Sports, and Similar Events without Facilities,” identifying with the code 711320. To analyze the strength of competitive forces within the industry and the attractiveness of the industry, we will use the Five Forces Model.
The first part of the Five Forces Model is the threat of new entrants. Based on the function of barriers, it is highly unlikely that there will be new people entering into the market. As an incumbent of the industry, UFC would desire to keep the threat of new entrants to be low so they can shut the door behind them once they are in. The Ultimate Fighting Championship has entered into the industry and kept others from coming into their space. UFC has captured market share through their product differentiation. Compared to other sports entertainment on television, this particular company has differentiated themselves from the rest of the industry through incorporating mixed martial arts and positioning themselves to internationalize. A fighter with a boxing background can be in the octagon with another fighter that comes from a jujitsu background. This sparks more interest amongst viewers as the company stands for their fighters and their branding association with different styles of fighting.
The next part of the Five Forces Model is the bargaining power of suppliers and for UFC; the supplier group would be considered to be potential fighters. A supplier group is powerful when satisfactory substitute products are not available to industry firms; suppliers’ goods are critical to buyers’ marketplace success; it is dominated by a few large companies and is more concentrated than the industry to which it sells; industry firms are a significant customer for the supplier group. By this definition, the supplier group is powerful: there aren’t any substitute
Industry Analysis
The Ultimate Fighting Championship is categorized, based on the North American Industry Classification System, as part of the “Promoters of Performing Arts, Sports, and Similar Events without Facilities,” identifying with the code 711320. To analyze the strength of competitive forces within the industry and the attractiveness of the industry, we will use the Five Forces Model.
The first part of the Five Forces Model is the threat of new entrants. Based on the function of barriers, it is highly unlikely that there will be new people entering into the market. As an incumbent of the industry, UFC would desire to keep the threat of new entrants to be low so they can shut the door behind them once they are in. The Ultimate Fighting Championship has entered into the industry and kept others from coming into their space. UFC has captured market share through their product differentiation. Compared to other sports entertainment on television, this particular company has differentiated themselves from the rest of the industry through incorporating mixed martial arts and positioning themselves to internationalize. A fighter with a boxing background can be in the octagon with another fighter that comes from a jujitsu background. This sparks more interest amongst viewers as the company stands for their fighters and their branding association with different styles of fighting.
The next part of the Five Forces Model is the bargaining power of suppliers and for UFC; the supplier group would be considered to be potential fighters. A supplier group is powerful when satisfactory substitute products are not available to industry firms; suppliers’ goods are critical to buyers’ marketplace success; it is dominated by a few large companies and is more concentrated than the industry to which it sells; industry firms are a significant customer for the supplier group. By this definition, the supplier group is powerful: there aren’t any substitute