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HI6006 Competitive Strategy Assignment, Holmes Institute, Australia

Assessment Title - Report - Case Analysis and Application of Strategy Models

Purpose: This assignment aims at ensuring that students have familiarised themselves with at least one of the long case studies and are able to apply the relevant foundational strategy development models that are applicable to the case.

Case - Competitive Dynamics

Answer - Case Analysis and Application of Strategy Models: Competitive Dynamics

Executive Summary

The case discusses about the Movie Exhibition Industry where there are three stages of the motion picture value chain. They are the studio productions and then handling the distribution with major emphasis on the exhibitions. Here, the stages are mentioned to focus on the relative unchanged structure which is set from the time of 1920. Here, he emergence of the trends directly affects the consumer decisions and the constraints that have been found to be modifying the different value chain standards. The operational variables affect the profitable potential of the firms who are involved in working for the movie exhibition industry. This could be effective for dealing through the challenges and then working over the reviewing of trends for the general environment.


The analysis is based on the covering of competition from the substitutes with handling the changes in buyer behavior with demographics. The case is about the company where Motion Pictures are considered to be the key drivers for the entertainment products. They are considered to be holding one of the largest export markets for the US. The motion picture industry mainly consists of the studio production, distribution and the exhibition. The biggest players are at the level where there are major big studios that tend to integrate the production and the distribution. The distributors are also called the intermediaries between the studio and the exhibitors where they tend to entail the steps with the firm artistic completion. It includes the marketing standards and the logistics for handling and working over the administration. The distributors tend to coordinate for the manufacturing and then focusing over the theaters that have been implemented for the digital content and the 3D setup.

Summary of the Case

The case highlights about the theater that has been implemented for the digital content and the 3D structure where the focus is on the 3D which might be resulting in more of action movies and few comedy drams. This could be helpful for the alienating the non-core and then planning about the impacts on the exhibitors till their bottom lines (Chen et al., 2017). The arguments are made for the benefits with the accruing exhibitors working on the appropriate studios. Here, the cost of the 3D savings are largely to be set for the distributors where the revenue is as per the admission which tends to increase and there is a split with the other studios. In order to develop the strategic alternatives, my analysis will highlight about the different business standards which includes the assessment of the competitive forces and the work at the industry. Here, the comparative situation and the strategic analysis is done for the firms that helps in producing the better results that are based on the revenue of the sources and the other major costs. This is mainly to enhance the performance and improve the likelihood depending upon the future success (Overton et al., 2016).


Identification of the Issues

There are different movies in which the movie industry has been competing. The extracurricular and the leisureactivities are considered important for the competitor in the movie industryalthough the DVD and the rental stores are considered to be the major competitors of the company for the movie industry. They are holding the advantages for the theatrical sound system which is seen to be fading with time. There are risks of replacement which is a major competitive pressure that the film has been facing. Not just that the company has been competing with the others but also, they are competing for their leisure activities where the consumer needs to select a particular platform as well. The consumers are seen to be investing in the house theaters. With the changing expenses they are finding that the elements are going down for the customers who find it as the alternative for the theaters. The consumers are able to bring into the theater by the location with the close distance to home, so that it is easy for the people to go and watch a movie (Thomas et al., 2016). There are financial models which are set by DICP for the theaters and there are significant motion picture studios that is setting for the digital standards and the projects for the sound devices in the theaters.

With this, the issues are:

1. Availability of the content: The issues are about the companies like Netflix which provides the easy access to the movies at home. The solution is the enhancement of experience with the nice theaters and the chairs or the tray to put the dinner food for 4D experience (Tashan et al., 2019).

2. Exhibitors: There are competition between the theater. Hence, the theaters need to work on the customer services, loyalty programs with handling the different markets and targeting different people properly.

3. Concessions and the Advertisement and the failure of the digital project technology.

SWOT Analysis

Strength: The new technology works on the new digital technology where the 3D options which is set for the features with the buildings that are large that are defined for the multi and megaplex style. There are external strength which are leveraging the concession industry with the distribution industry.


Weakness: The weakness is about the reliability on the conversions and the advertisements, or the pricing and the experiences that are largely considered to be same as the competitor. The external content includes the consumer income with the marketing of the movies with the studio production companies that are set for handling the split sales with distributors.

Threats: They are for handling the problems of the other competitors.Higher Concession Prices: They are making the consumers not want to watch the movie. Hence, the solution is to provide the better quality of the food and the dinner in the theater. Declined Experience: The issue is about the interruptions of the cell phones and the rude patrons. Hence, the solution is the actual time that the movie is printed with no cell services in theater.

Opportunities: They are based on handling the content choices and the experience of the concession options. There are external growing middle classs to rebound and take from the recession.

There are different purchaser power which is considered to be the health force mainly for the target market and there are different factors which include the undifferentiated product which are offered at a lower and the basic expense. The consumers are able to stay at home and watch the movies. The customers are also complaining about the problems of concession and the expense of the tickets along with the advertisements which are shown (Ciciretti et al., 2015).

Porter Analysis

Competition in Industry

The situational measures of the company has been to face the different forces in the generalenvironment where there is no control. Hence, the external conditions involve the allowing the exhibitors to grow and work on the improvement of the performance standards. It depends on the trends of the different segments which will help in creating the opportunities and the threats. The technological segment is based on the digital advancement where the movie exhibition methods have been changing with time. There are different number of the digital theaters that are growing with the 3D movies that works on providing the unexpected opportunity for the cinemas for the increased revenue (Baum et al., 2018). The planning is about the mainstream procedures and the measures of the products in the markets. The studios have been eliminating the film costs and they have been benefitted from this conversion. There are upgrades for the projection operations with the investment costs that the owners tend to incur.

New Entrants

The industry marketing standards are working over the social networking and internet to render the marketing of the new picture which are effective for reaching a greater potential of the audience. With this, there are relations based on the widening of the targeting demographics with the movie industry that works on the content diversification of the movies to work and reach the goals where the people cannot afford to fall till there are great privileged members for the society like the people that do not like in New York. there are perspectives where the movie viewed are focusing on the increased content which helps in the reflection of socio-economic experiences. I believe that there are studios which are selfish in their approaches and they deal mainly through the sole suppliers as well. The deal is about the TV and the movie rental industry that constitutes of the rivalry mainly for the exhibitors. There are industrial changes that comes when the processes are determined through addressing the ticket pricing (Singh et al., 2018).


Power of Supplier

The adaptive marketing is done though social networking and internet for the rendering of the marketing of new pictures and the effectiveness is based on the accuracy array of potential audience members. The people do not constitute for the elite ranking for the socio-economic backgrounds. This begins with variations in the content for the new produced pictures and the focus is on the subject matters or the movie topics that suit the wider range of the age groups (Leung et al., 2017). The demographical standards of the company are based on the trends with the segments showing that the company will be benefited from the growing changes.

Power of Customer

It requires to work on the maximization of the future revenues and the profitability, where there are other external factors that tend to contribute towards the slowing down of the giant industry. The technology is being the biggest one. Here, the production studios need to work on the targeted demographics and focus on the lack of the assistance from the suppliers. They need to understand about the root problems which is the shrinking market that needs to be realigned and worked for the targeting of a wider frame with the population that is coupled with mutual beneficial alliance in between studios and the exhibitors.

Threat of Substitute Products

The consideration of the negative growth has been mainly because the Movie Exhibition Industry has been mainly influenced by the different contributing factors which impact the components and planning of the value chain. Here, the issues are about improvement of the future strategic plans and then assessing the contributions to the declined factors.

Competitive Strategy

Cost Leadership

The competitiveness is based on the advantage and then planning about the outstanding options for the customers through using the different spaces. Here, the theaters are having the buildings and then working over the playing of movies and then re-examining about the utilization of the same. The use of 1 or 2 screening rooms are for the banquet which are for testing about how the world would not break the bank. The concession sales and the ticket sales are considered important revenue sources, where the competitiveness is based on matching with the core demographics that are expected to slow with US population and the technological advancement. There are ticket sales which will continue to decline if the current business strategy is followed.


Differentiation Leadership

The Movie Industry tend to maintain the unique features for the products and then create a differentiating factor. The marketing is based on the superior brand and the quality with consistency for the promotional support. Hence, from the more effective targeting and the capturing of the new targets, the market needs to focus on the research along with gaining a better understanding where the audiences will be working on the forward-thinking marketing techniques and the market share will not be seizing to decline as well.

Cost Focus

The strategy is of the firm which works on the concentration of the specific marketing segments and then keeping the products at a lower pricing. Here, the strategy is mainly to satisfy the customers and then gain the popularity. The company should work on the expansion of the lobby dining and the upscale within the theater dining, with proper discounts and the sales. This will be important for the crowd gaming and the surveys as well. The solutions for the failure is the providing of facility of selective 3D view and the enhancement of the experience for the privileged members.

Differentiation Focus

The strategy aims to differential and then plan the segments only. The differentiation is to meet the demands and then focus on refraining from purchasing the competitor products which is due to missing any of the small features as well. The problems of the lowering of the ticket prices and the video play needs to be handled through understanding the mitigation of the risks through international sales. The company should produce the fewer large budget films every year and focus on the small budget films. The problem of the cross-cultural and the language barriers can be handled through the use of anthropological study for guiding the film and then hiring the employees with the better intentional background (Stead et al., 2017).


There are choices about the use of cinema where it is seen that most of the theaters fall in between mini-plex and the mega-plex. Here, there are different displays that are specific for viewing the areas and there are tests choices that needs to be carried out without any interruption that is presented to the company. The use of the cloud computing is for the implementation of the data storage and then making it easy for the business to go directly to consumers. The suppliers are reaping benefits with taking profit for 38%. There are alternatives which are found to be handling the test alternatives which are conducted without any disruption of the business. It is important from the audience point of view to make a trip for the movie which can be an opportunity for the theater experience that can be interesting as well. The cost reduction will surely be coupled with the innovation of the additions and then working over the enhancement of the movie experiences as well. It will be able to create a better incentive for the different members who are trying to work online for going into the movies.


As per the analysis, the consolidation of the major theaters and the Megaplex is not an effective strategy for the long term. Hence, the direct corrective action is needed for the today's exhibitors for handling the continued processes and then work over the investment standpoint. The cases are related to not only take care of the shares to cover the investment costs but also work on the triggers which will help in focusing or providing the industry with the more balanced structure.


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