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Corporate Strategy Assignment

Corporate Strategy Assignment

 Corporate Strategy Assignment


Exhibition is often addressed as the retail branch of the movie industry. It involves the screening of the movie to the masses who are usually the paying customers. The exhibition sites are mainly devoted to the screenings of movies of different genres.  The case study of the movie exhibition industry provides an in depth insight to the tenuous and uncertain outlook of the owners of the movie theatres. The report will focus on conducting a thorough analysis of the internal and external analysis of the movie industry and the changes in the value chain and operating variables that influence the profitability of the various exhibitors of US. The report will also pay attention to the initiatives undertaken by the movie exhibitors to ensure that they can cope with the existing environmental challenges (David et al., 2017).

The report would also intend to focus on the impact of the advancements in digital technology and the changes in the current trends that influences the decision of a consumer. The analysis would also focus on the constraints forwarded by the studio dominated business models that results in multiple clashes between the movie theatre owners and the distributors as well.

External Analysis

The US movie exhibition industry is taking up strategies to keep up with the disruptive technologies and the environmental challenges. By conducting an industry analysis would allow in the better understanding of the powerful forces and their influence on their profitability and operations.

Threat of the New Entrants: The threat of new entrants is low in this industry. The already existing movie theatre owners have over capacity of screens and because of industry consolidation. In addition, the major competitors are placed in different geographic markets so the direct competition is not intensified. The preference of the people to watch movies at home also plays a key role in decreasing the threat of the new entrants (Dess et al., 2014).

Bargaining Power of the Suppliers: The bargaining power of the suppliers is identified as high. The exhibitors are completely dependent on the policies and decisions of the studio and because of that the studio is responsible for the low profitability of the exhibitors. Due to the control motion picture studios have over release and content development, thus they are being provided with high negotiable power.

Bargaining Power of the Buyers: The bargaining power of the buyers is moderate. The movie goers do not possess any cumulative bargaining power and neither their demands result in price changes. The buyers are only provided with the option of changing theatres if they have poor experience with the theatre.

Threat of the substitutes: The threat of the substitutes is high. The extensive availability of alternatives poses as a threat to the theatres. The availability of movies outside theatres reduces the demand of theatre experience in people.


Industry Rivalry: The industrial rivalry is moderate but the threat is growing at a rapid rate because due to the availability of substitutes and also because of increasing the theatre experience of the people (Chuchrova et al., 2016).  

BCG matrix is a strategic tool which helps the analyst to evaluate the current position of the organization in the market as well as the performance of business units or product lines. It also helps the marketer to allocate the available resources effectively. This matrix consists of four quadrants and the analyst rank and places the business units in these quadrants based on the market shares and growth rates; which include cash cows, dogs, question mark and star. The cash cows have high market share and low growth rate; the dogs have low market share and low growth rate; the question mark has high growth rate, but low market share; and finally, stars have both high market share and high growth potential.


List of References

Chuchrova, K., Vilamova, S. and Kozel, R., 2016. Strategic analysis as a tool for strategic decision-making processes at industrial companies. Актуальні проблеми економіки, (2), pp.180-191.

David, M.E., David, F.R. and David, F.R., 2017. The quantitative strategic planning matrix: a new marketing tool. Journal of Strategic Marketing25(4), pp.342-352.

Dess, G.G., Lumpkin, G.T. and Eisner, A.B., 2014. Strategic management: Text and cases. McGraw-Hill Education.

Edgerton, G., 2014. American Film Exhibition and an Analysis of the Motion Picture Industry's Market Structure 1963-1980. Routledge.

Kumb, F., Kunz, R. and Siegert, G., 2017. Research on the motion picture industry: State of the art and new directions off the beaten track away from theatrical release. Journal of Economic Surveys31(2), pp.577-601.

Rothaermel, F.T., 2015. Strategic management. McGraw-Hill Education.

Takahashi, Y., 2015. Estimating a war of attrition: The case of the us movie theater industry. American Economic Review105(7), pp.2204-41.



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