The most recent list of the world’s most valuable brands has Apple unseating Coca-Cola for the first time from its #1 spot. Meanwhile, BlackBerry has fallen from its precarious position at #93 and dropped off the ranking altogether.
I noticed that Blackberry LTD’s current financial state has frequently been mentioned in class. A number of reasons can be attributed to their current downfall; an analysis of their competitive strength and business position by Porter’s Five Forces illustrates some of the underlying issues. The mobile phone industry is already well established so the threat of new entrants is relatively low. Buyer power, however, is high due a concentrated demographic that is actively seeking the best value for their money and therefore influencing prices. Most significant is the competitive rivalry with other brands; with Apple and Samsung capturing more than 50% of the Smartphone market, various other competitors are eager to increase their market share. Since product differentiation is limited, failing to keep up with the innovations of rival companies consequently made Blackberry lose its momentum in the industry.
