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Marketing Answer 1 Porter’s Five Force Analysis Threat of New Entrants As it has been mentioned before due to high level of industry margins various companies are looking to enter the market. Coca Cola has already entered the market through the launch of new product called relentless.
Threat of Substitute The food drinks mainly represent the fast moving consumer goods market and therefore the markets mainly rely on creating impulse purchase. Price sensitivity is quite low in the market; mainly marketers mainly rely on customer loyalty and brand loyalty. There are a lot of products that can provide boost and act as replacement to the energy drinks. Due to the nature of the product the target customers may switch to soft drink and carbonated drinks. Also the customers have a lot more health conscious. Therefore the customers may also look to drink lot of fluids such as herbal tea and water. Hence, there are a lot of alternative options for the customers. Overall, the level threat of substitute of products is high. Bargaining Power of Suppliers While considering the bargaining power of the buyers from the perspective the energy drink market only it can be interpreted that the bargaining power of the buyer would be quite low as there are very few players in the market. Also buyers in the market are not very price sensitive as the products are targeted towards the higher end market. The relation between the manufacturer and retailer has also evolved over the course of the market life cycle. However, the buyers should be wary of the fact that there are a lot of substitute products in the market (Williamson, Cooke and Jenkins, 2004). ...
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