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Tag: Business Competition

  • P&G and Unilever: The FMCG Royalty

    Both are multinational consumer goods companies. Both operate in the FMCG (Fast Moving Consumer Goods) industry. Both companies have a strong legacy and a long history and enjoy a great reputation in the market. Both their product repertoire includes household and personal care items, food and beverage products, and beauty and personal care products. Both are publicly traded companies. One is American, while the other is British. These companies are Procter & Gamble Company and Unilever.

    A comparison between these two giants is inevitable. However, it is imperative to understand the origins and the growth trajectory of both these companies.

    Origin and Growth
    A Comparison of the Titans

    Origin and Growth

    Procter & Gamble

    Candlemaker William Procter and soapmaker James Gamble founded this company in the year 1837 which is headquartered in Cincinnati, Ohio. Within a couple of decades, Procter and Gamble’s sales reached USD 1 million. The company gained immensely during the American Civil War as it won contracts to supply the Union Army with soaps and candles. This also helped in increasing awareness for the company and its products as military contracts introduced P&G products to soldiers from all over the country.

    By the year 1887, William Arnett Procter, William Procter’s grandson, who was leading the company, began a profit-sharing program for the company’s workforce which proved to be immensely successful and contributed to its growth and expansion. Its product demands grew exponentially resulting in P&G beginning to build factories in other locations within the US. During this time, it also diversified its products and in the year 1911, began producing Crisco, a shortening made of vegetable oils rather than animal fat.

    By the year 1930, P&G expanded its footprint internationally by acquiring the England-based firm Thomas Hedley Co. From here on, there was no stopping their growth and expansion. P&G, over the years and through various acquisitions as well as product growth and new product introductions further penetrated international markets. By the year 2014, the company had more than 160 products on its brochure when it announced a restructuring. It dropped around 100 products from its repertoire citing sluggish sales and concentrated on the remaining 65 products which were bringing in almost 95% of the company’s profits. By the year 2018, it simplified its corporate structure with six business units.

    P&G - Products
    P&G – Products

    Unilever

    It was in London; England and the year was 1929 when Unilever was formed as a result of a merger of Dutch Margarine Unie and British soap maker Lever Brothers. Over the next decade, the business grew and expanded into Africa and Latin America. Due to the Nazi occupation of Europe during the second world war, Unilever, unable to reinvest in Europe, expanded its presence in the United Kingdom and the US. Over the next few years, Unilever expanded its product portfolio through its efforts and various mergers and acquisitions. By the mid-1960s, Unilever products laundry soaps, and edible fats contributed to almost half of the company’s profits. However, markets for yellow fats were stagnating and the company was facing increasing competition from Procter & Gamble. In response, Unilever diversified its product portfolio and acquired British-based Lipton Ltd., from Allied Suppliers in the year 1971. By the end of that decade, Unilever had gained 30% of the Western European ice cream market through various acquisitions. This became the turning point for the company as by the year 1982, it repositioned itself as a company more concentrated on fast-moving consumer goods.

    Unilever - Products
    Unilever – Products

    Over the years, Unilever strengthened its product portfolio, merged with and acquired many other brands and companies, and expanded its global footprint by establishing business operations across many countries. Currently, Unilever’s global brand portfolio boasts 400 different brands.

    Fast Moving Consumer Goods (FMCG) – Business Model, Market Size & Strategies
    Have you ever wondered why are FMCG industry so successful and how do they have huge market share? Lets understand the business model of FMCG Companies.
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    A Comparison of the Titans

    Despite a difference of more than 90 years between these two FMCG titans, traditionally both have battled for supremacy in several household goods and personal care products ranging from laundry detergents to shampoo. However, the key difference between these two companies is their geographical focus. P&G, originally from the US, has a highly concentrated presence in the developed markets, more specifically in North America and Europe. Unilever, on the other hand, has a diverse global presence with high-volume sales originating from Asia, Africa, and Latin America. Even so, there are a few parameters on which these companies can be compared.

    Financials

    Procter & Gamble, on average, houses stronger brands and has a more efficient business operation. These have resulted in the company having a better operating margin. The company also delivers higher returns on capital employed. Unilever, on the other hand, even though it has a global footprint has witnessed a deterioration in its return on capital employed.

    Growth & Expansion

    By December 2022, P&G had posted an annual revenue of USD 80 billion and Unilever had posted an annual revenue of USD 62 billion. However, the last decade has not seen any significant revenue growth in both companies. The main reason being cited for this is that both companies have been selling some of their low-performing brands, streamlining and restructuring business operations.

    P&G By the Numbers - 2022
    P&G By the Numbers – 2022

    Sustainability & Social Responsibility

    Both companies are vastly different in addressing this issue. While Unilever enjoys a strong reputation for its efforts in reducing environmental impact while simultaneously striving to improve the lives of the communities in which it operates, P&G is less focused on sustainability in comparison.

    Unilever Sustainable Living Plan

    Valuation

    The price-to-earnings ratio shows P&G with a higher value than Unilever. However, Unilever’s valuation is a lot less demanding. This also results in Unilever shares yielding a higher dividend. However, P&G has consistently delivered increasing dividends for the last 66 years. So, investors looking for dividend growth might prefer P&G shares while investors looking for a higher starting yield might prefer Unilever.

    Competition

    As big as both these companies are in terms of business operations and as famous as their various brands are, significant competition exists for them from supermarket private label brands and startups aiming to conquer specific niches. Also, both these giants are also facing increasing threats with innovative startups targeting a specific operating niche like products in the natural and eco-friendly space.

    Unilever vs. P&G: How CPG Giants Fight Competition from Innovative Startups

    Conclusion

    It is extremely difficult to choose one company over the other, especially with these two FMCG giants. In recent times, P&G has already successfully implemented its restructuring while Unilever is yet in its early phases of business transformation. Both of them are facing a similar scenario when it comes to competition so it will be interesting to see how they both fare in the future.

    FAQs

    When was Procter & Gamble founded?

    Candlemaker William Procter and soapmaker James Gamble founded P&G in the year 1837.

    When was Unilever formed?

    Unilever was formed as a result of a merger of Dutch Margarine Unie and British soap maker Lever Brothers in 1929.

  • Spying on Your Competitors – 10 Different Ways

    With the increasing number of options that are available to people on a product, competition has been on the rise since the last century. To gain an upper hand in the tussle between demand and supply, every company tries to understand the strategies of their competitors to prepare ahead of them and get a lead in the market.

    This kind of spying has become a very common part of any company that today there are people assigned to analyse the activities of their competitors. Spying over a company is easier said than done.

    It requires a collation of a lot of small but important things. In this article a few very important methods and spy tools that anybody who wants to understand what your competitor is doing are discussed.

    Let’s look at the 10 ways on how you can Spy on your Competition.

    Keeping Up With Their Literature
    Following on Social Media
    Look Out for Keywords
    Focus On SEO
    Follow the Ads
    Check Up on the Products They Promote
    Tracking Indexed Websites
    Checking Google Ranks
    Finding Backlinks
    Going Through the Reviews

    Keeping Up With Their Literature

    Here literature means any kind of text that they release on their behalf. These can be blogs, articles on papers, newsletters, surveys etc. It is obvious that they won’t share any information with their competitors, but following the above-mentioned one will help. You will get to know their ventures and campaigns before they actually happen. It is important to follow them judiciously and more important to analyse and elucidate the inner meanings if any.

    Following on Social Media

    There is no better campaigning alternative for a brand other than popular social media platforms to connect with customers and share their plans efficiently. The activities and engagements of your competitors on social media platforms tells a lot about the future plans.

    Not only that, it also tells a great deal about their digital marketing strategy as well. It is a great way to understand a significant part of your competitors’ ways of doing business.

    Look Out for Keywords

    As mentioned earlier, one of the most popular ways of setting a brand’s name is through social media campaigns. And here the importance of choosing the right keywords cannot be stressed enough. Hence, one of the best ways to check on your competitor is by trying to understand the keywords that they use to increase the traffic into their website. You can use various tools available online like SEMrush, Ahrefs Keyword Explorer, and Google Keyword Planner etc. to see the keywords used by your competitors rather than trying to understand each keyword.

    Focus On SEO

    Finding the keywords brings us to another important thing to be done. That is, checking their SEO tools. You might wonder what it is that makes your competitor have an edge over you despite selling the same kind of products, the answer might be in their SEO techniques. You can also understand the techniques that will bring organic traffic. There are tools like Positionly (now Unamo) which will really help in getting real time comparative data on website traffic.

    Follow the Ads

    Advertisements are a great way to entice customers and increase business. Ads will play a big role if they are formed correctly and placed rightly. The websites and platforms on which these ads come up is also very important. It tells a lot about their campaigns. You can track and spy on the websites and platforms on which their ads are displayed and plan accordingly.

    There are Ad Spying tools that give an insight into your competitor’s ads. One of the tools that can be used is AdSpyder. AdSpyder gives you an insight into the SEO strategy used by your competitors on different platforms. With the help of this tool, you can understand the secrets of your competitors and make them useful for your own ads.

    Check Up on the Products They Promote

    Promotion is a very important part of any marketing campaign. The nature of products and the way of promotion will tell you a lot of their strategies. It can be a great way to adapt better things and reject things that are unnecessary.

    Tracking Indexed Websites

    Indexing in Google is one of the most important things that any brands would do to increase their reach. Rather than going after all the websites of your competitor, track the websites that are indexed in Google. It will help you organise the work in a more efficient manner. Google in itself is a good tool to do it.

    Checking Google Ranks

    Checking Google ranks is a great way to know where you and your competitor stands as far as traffic is concerned. You should understand where your competitor is ranked for every relevant keyword that will be searched. Finding a competitor’s ranking alone is not enough. You should also analyse their growth over a period of time. It will help you get an idea of their pattern of growth.

    Backlinks are very important to maintain good rankings for your website. That makes it clear how important it is to find the backlink strategy of your competitor. It will help you get a better clarity on their marketing strategy. You will also have an idea on how to effectively use your backlinks to reap the best outcomes.

    Going Through the Reviews

    All the campaigns that brands do, boils down to one thing – customer satisfaction. It is the key to increasing business. Analysing the customer reviews is a great way to spy on your competitor although it might sound direct. While the review of the customer gives an idea about their reception of the campaign, the reply of the competitor tells a lot about their strategies. If the reviews are negative, it will be an insight to correct your mistakes before it gets out.

    Conclusion

    It is true that competition has increased significantly in recent times. But it also means that there is more scope for improvement and learning from mistakes without actually making mistakes now than ever before. Understanding your competitors’ marketing will really help you in getting an idea about consumer requirements and expectations.

    The above-mentioned steps are an integral part of this understanding and it is not an exhaustive list. These pointers are not to spy on your competitor but to serve as an opportunity to reflect upon your strategies and initiatives.

    FAQs

    Is spying on competitors illegal?

    It is not illegal to spy on your competitors unless you break laws, like hacking into the security of your competitor’s database.

    How can I see what keywords your competitors are using?

    BuzzSumo, SEM Rush, SpyFu, and Ahrefs’ are some of the top keyword research tools you can use to spy on your competitors.

    Why is it important to do competitor analysis?

    The purpose of a competitor analysis is to understand your competitors’ strengths and weaknesses in comparison to your own and to find a gap in the market. A competitor analysis is important because: It will help you recognise how you can enhance your own business strategy.

  • How to become a Business Analyst in 2021 (Complete Guide)

    Any form of business requires a multidimensional approach. It requires coordination between them as well. With the ever increasing globalisation and mechanisation, it is highly important to avoid gaps and discrepancies as far as businesses are concerned.

    This also means that there should be a connection between the IT related nuances and the business related realities. No aspects will work as independent entities any more.

    A Business Analyst is a person who bridges this gap. They are capable of effectively planning and predicting the behaviour of a business model through well informed technical tools that fit the firm.

    Data analytics is considered one of the most important arms of industry 4.0 and its scope in the future is predictable. If you are a science person who loves to be in the corporate world, then business analysis which comes under data analytics is the right choice for you. This emerging high potential job has a few prerequisites and a few steps before becoming one yourself. This article guides you through the details on how to become a Business Analyst in 2021.

    Who is a Business Analyst?
    Skills needed for a Business Analyst
    How to Become a Business Analyst
    Online Certification Courses for Business Analyst
    FAQ

    Who is a Business Analyst?

    Business Analysts are those who engage with large contents of data to derive patterns of occurrences. Their scrutiny will help improve the quality and efficiency of the business firm. They will help in understanding places where there is a performance gap and will suggest a better option to mitigate them.

    They focus on functions and processes of an organisation. As mentioned earlier, they serve as the mediators between technology and commerce. Through data analysis, business analysts become capable of simplifying complicated tasks into simpler ones by giving data driven recommendations.

    They strategically plan things for the company to reduce the chances of failure as much as possible. It requires a deep understanding about both market scenarios and information technology. The four main types of planning that business analysts do are :

    • Strategic planning – Depending on the needs of the company
    • Process design – Planning the flow of procedures
    • Business model analysis – To propose different market approaches and business strategies
    • Systems analysis – Based on the technical requirements

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    Skills needed for a Business Analyst

    Scientific temperament

    You are going to deal with big data and technology which are highly scientific. It demands you to be curious about new things, especially scientific ones. Only if you are able to understand the science of functioning can you identify the problems and recommend a feasible solution.

    Critical Thinking

    It can also be read as analytical thinking. As a business analyst, you serve as a link between information / data and business. In order to derive connections and solutions, one should be able to critically analyse the data available.

    It is because no observations will be implicit and the data analyst in fact has to decipher the problems and solutions from the data. Hence, a business analysts should be capable of critical thinking

    Organisational Skills

    It is important to properly classify the data available to get the best out of it. Although this is mechanically done, it is important to keep track of the data organisation.

    Carelessly organised data can give distorted results which will further affect the analysis. So be sure to develop a habit of organising things right from your own bedroom. Let that be a part of your lifestyle.

    Communication Skills

    Business Analysis is not a job done by a single person. It is not humanly possible also. Hence, many business analysts in a firm come together to discuss and collate their observations to reach a fruitful conclusion.

    To facilitate this, it is very important to have good communication skills. It is not only to put across your observations and inferences but also to absorb the most valuable information from others as well.

    Documentation Skills

    Keeping track of things is one of the most important parts of a Business Analyst’s job. They are to document the variations in the functions and processes of the firm so as to provide appropriate recommendations. Apart from that, such documentation is required for deriving a particular information from a different point of time.

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    How to Become a Business Analyst

    Considering the amount of technicalities behind the work that a business analyst needs to do, it is always better to train yourself professionally. However, the option to self learn is always open. Today you have a lot of courses on the same.

    Undergraduation

    If you are going for an undergraduate degree, go for a Bachelor in Business Administration in fields that you like. Some colleges offer courses in business analytics. But be mindful that it is different from business analysis. However, the fields are related and will definitely help you in your studies.

    During this time, learn more about computer programming as much as you can. Analysing case studies of different kinds will also help you in being a better candidate.

    Higher Education

    You can either go for an MBA which specialises in Business Analytics or allied subjects. Such a programme will really help you in further dwelling into the intricacies of the wide subject and will make you a pro. A postgraduate certificate will definitely aid you in getting good positions.

    Another thing you can do is that many international firms offer specialisation certificates that are widely approved. You can try undergoing their courses and earn your certificates. Some of these certificates are

    • IIBA Entry Certificate in Business Analysis (ECBA)
    • IQBBA Certified Foundation Level Business Analyst (CFLBA)
    • IIBA Certification of Competency in Business Analysis (CCBA)
    • PMI Professional in Business Analysis (PBA)
    • IIBA Agile Analysis Certification (AAC)
    • IIBA Certified Business Analyst Professional (CBAP)
    • IREB Certified Professional for Requirements Engineering (CPRE)

    These courses will help you in getting a senior Business Analyst position.

    Online Certification Courses for Business Analyst

    • The Complete Business Analysis Fundamentals Course + CERT by Udemy
    • Business Analysis and Project Management by Coursera
    • Introduction to Business Analysis Using Spreadsheets by Coursera
    • Excel to MySQL: Analytic Techniques for Business Specialisation by Coursera
    • Business Analysis and Fundamentals by Udemy
    • Business Analyst : Project Management Techniques and Tools by Udemy
    • Business Analysis Modelling Skills and Techniques by Udemy
    • Business and Data Analytic Skills by Edx
    • Business Analysis: Developing Requirements by Udemy

    FAQ

    What is the main role of a business analyst?

    Business Analyst bridge the gap between IT and business using data analytics to data-driven deliver reports to executives.

    What qualifications do I need to be a business analyst?

    You require an Undergraduate degree in computer science, business information systems, computing and systems development, and business management.

    How much does a a Business Analyst in India make?

    The average salary for Business Analyst in India is ₹7,00,000 per year.

  • Brainly- Business Model and Story

    With so many educational startups like BYJU’S, Toppr, Vedantu, Unacademy, UpGrad, etc. emerging around the corner, raising millions from the students of India, few international platforms like Brainly are also paving their way to take their bite from one of the biggest youth-oriented countries.

    Let’s see how this 11-year old edtech company set to surmount the world’s e-learning market.

    Brainly – About
    Brainly – Foundation
    Brainly – Story of Startup Launch
    Brainly – History
    Brainly – Business Model
    Brainly – Challenges Faced
    Conclusion
    FAQs

    Brainly – About

    Brainly is an education technology company based in Krakow, Poland. Brainly provides a knowledge-sharing community where millions of students, teachers as well as parents share knowledge and solve each other’s problems. It has become the world’s largest social learning network, having reported 250 million monthly users per month across the 35 countries it serves, among which 15 million users are from India itself.

    Brainly, as it describes itself, is a place for students, by students. The motto of Brainly is Smarter Together. Mainly built for high school and middle school students, all types of solutions and help can be found in this application, be it about Mathematics, History, Calculus, English, Biology, Chemistry, Physics, Social Studies, Health, Business, Arts, World Languages, Law, Computers and Technology, Engineering, Medical Sciences, French, German, etc. and many more.

    Moreover, Brainly makes its usage more interesting by granting points to its users when they answer questions posted by others. And it awards ranks to users based on their frequency and accuracy of solving problems. The website also provides teacher ranks to professional teachers. So peers can have a healthy competitive environment among themselves while also enjoying the website and learning together.

    Brainly Introduction

    Brainly – Foundation

    Brainly was founded in 2009 by three friends Michal Borkowski, Lukasz Haluch, and Tomasz Kraus. Since then, it has set up its headquarters in New York City, United States, and Krakow, Poland; and expanded its venture over 35 countries, raising 38.5 million dollars from its seven investors, including Naspers which also funded BYJU’s.

    Brainly – Story of Startup Launch

    Michal Borkowski | Co-founder and CEO of Brainly
    Michal Borkowski | Co-founder and CEO of Brainly

    The inspiration to start this multi-million dollar company came from Michal Borkowski, co-founder and CEO of Brainly. Before Brainly, Michal worked for Q&A networks and got to understand from it that subject-specific Q&As perform better than general Q&As. This later became the original inspiration behind Brainly.

    Brainly was launched at the time when edtech companies were not much encouraged and it was difficult to find investors. So the three founders funded their company themselves and took the risk, and within a year, their decision got paid off as millions of students were starting to use Brainly to know more, and to know faster, in a click. And today Brainly claims to have built the world’s largest social learning network.

    The Brains behind Brainly.Michal Borkowski, Lukasz Haluch and Tomasz Kraus.

    Brainly – History

    The company was initially named Zadane.pl. In 2011, just 2 years after the company’s birth, it created Znanija.com, the first international project dedicated to Russian language speakers. After that, the growth of this company had no turning back and raised several funds from large capital firms. The total funds raised by the company since its establishment is reported to be $68.5 million.

    In 2017, Zadane.pl changed to Brainly. In January 2018, Brainly announced the ownership of the video education startup, Bask, to bring video technology to the Brainly platform.

    Brainly – Business Model

    After conquering the world, Brainly is now all set to expand in India by focusing on vernacular content. It has already created a 15 million userbase in India within 2 years, the same as India’s first and only edtech unicorn BYJU’s. Brainly conducted a survey for Indian students and found that its users comprise of 42% secondary and 39% higher secondary grade students.

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    However, Brainly has not yet monetized its services in India. According to Michal Borkowski, the CEO and co-founder, Brainly is giving priority to the growth of its reach to every potential user over profits. It has planned an efficient business model for rooting in India.

    India offers a huge market to Bainly. People here are more willing to spend their salaries on their kid’s education than any other sectors. The building competition among students and the pressure to succeed put up by parents acts as a boon to Brainly’s market opportunities.

    Moreover, students are dissatisfied with their schools, complaining that the schools are unable to prepare them for their careers. So here comes the need of an easy-to-go help source.

    Unlike most other edtech companies established in India that provide competitive exam preparations and tedious learning programs, Brainly focuses on specific, curriculum-related problems and skill strengthening through connecting students together.

    India’s Education Market

    Brainly – Challenges Faced

    Brainly’s current strategy is to build the student community and work on the content to ensure the best quality possible. But India also poses some challenges.

    Lack of internet availability, which is a great problem in rural areas and semi-urban areas of the country, can cost a lot of users to Brainly. For this, the Brainly team is working to have a low and flexible data requirement for their app.

    Lack of a unified syllabus in India also puts the company in trouble. So it does not follow a specific curriculum so that it can have a wider userbase of all school subjects.

    Seeking the vernacular language is also a tough and elaborate job. India, having 22 official languages and thousands of regional ones, Brainly has to launch in languages other than English and Hindi in order to attract all types of students.

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    Conclusion

    Brainly’s multifaceted community of experts encloses students who help answer other students’ questions, be it a complex calculus question, or a conceptual question about a reading based assignment, or any inquiry regarding studying strategy for any career-related goals. So it assures verified and reliable solutions and to its users and builds a sense of trust for itself.

    As Brainly puts its concept in a line, “No one knows everything, but everyone knows something. With Brainly, students combine their strengths and talents to tackle problems together.”

    With such great perspective and an efficient and dedicated team constantly working to refine its business model and open to new ideas; the day does not seem to be far away when Brainly will become every Indian student’s goto app.

    FAQs

    Is Brainly a free app?

    You can always access most of the content and features available on Brainly for free. But if you wish to access all of the answers on Brainly, including Verified Answers with 100% uninterrupted access, you can purchase a Brainly Plus subscription!

    When was Brainly founded?

    Brainly was founded in September 2009 in Poland by founders – Michal Borkowski, Lukasz Haluch and Tomasz Kraus.

    Do you get paid on Brainly?

    Brainly doesn’t give you money. It works like Quora, where you answer questions to get points, and then use those points to ask questions and clear your doubts.

    Is Brainly Indian?

    No. Brainly is a Polish EdTech, headquartered at New York. It is available to use in India though.

  • Main Reasons For The Failure Of Orkut

    Social media has become crucial for everyone. People of different age groups, teenagers and adults have social media accounts and they use them for various purposes. Social media is basically technologies that facilitate the creation and sharing of information, photos, ideas, videos, and so on.

    These days, there are a lot of different social media platforms and the emergence of advanced platforms led to the Orkut downfall. Social media can help share details with the public and also meet other people who are available on the platform. It doesn’t stop there. Social media is now used for marketing and it has proved to be one of the best sources of marketing. The use of social media has been increasing since it came into existence. Orkut was one of the very earliest social media platforms. Orkut founder is a Turkish engineer named Orkut Büyükkökten.

    Orkut was Google’s first step towards social media and it was extremely successful. Orkut was launched in the year 2004 and had a lot of competitors like Yahoo messenger, skype, etc. Orkut could very easily get ahead of all the competitors. It could make it through with 3 times more users than Facebook. All these were in the Orkut’s initial stages. Even India and Brazil had a lot of users for Orkut. Keep reading to find out about the rise and fall of Orkut.

    Orkut Features
    The differences between Orkut and other Social Media Platforms
    Reasons behind Orkut’s Failure
    Frequently Asked Questions

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    Orkut Features

    The top features of Orkut were

    • the Orkut profile allowed the user to add friends and message them privately
    • sending scraps to people (which was visible to everyone)
    • posting images and videos
    • option of liking each other activity
    • Orkut games and community polls were a popular feature
    • a unique Orkut feature is customizing themes
    • Rating your friends and becoming each other’s fans

    The differences between Orkut and other Social Media Platforms

    When Orkut started it was just like other social media platforms but with some differences. These differences might have been the reason for their success initially. It had features wherein one can create an account, manage a profile, and so on. Orkut had one good feature that other platforms did not have. There was an option for ‘crush list’ and we can customize themes on this platform. This was not available on any other platform. Other than this, the working of Orkut was similar to the working of other platforms. The Orkut login and interface was quite easy but it lacked other features.

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    Reasons behind Orkut’s Failure

    In the year 2014, Orkut was shut down. So why did Orkut fail? It was because it did not have a very good user base and most users started shifting to other social media platforms from Orkut. There were a lot of reasons for this. this, Google was closed to shut down Orkut. The main reason for this was the emergence of other social media platforms that were in most ways better than Orkut. Here, let us analyze the reasons for Orkut’s failure.

    One main reason for the failure of Orkut was the competitors growing much faster.
    One main reason for the failure of Orkut was the competitors growing much faster.

    1. Privacy

    People love posting on social media and maintaining a profile but at the same time, they expect some privacy. One of the biggest reasons why Orkut was closed, was because everyone could see anyone’s profile and also personal information and contact details. You could stop someone from seeing your profile only if you put them on your block list. Facebook had a few privacy settings and options to show the profile and other details only to people who are added to your friends’ list. This made a few users switch to Facebook, one of Orkut’s leading competitors as it looked much safer than Orkut.

    2. Speed

    The website was initially fast and worked perfectly well but later, after a few redesigns, it became very slow and the loading took a lot of time. Also, with the number of users increasing, it became a bigger issue. The existing server was not enough to handle so many users and hence the uses had to wait for a long time to reach the landing page. Also, when Orkut was in the initial stage, the average internet speed was quite low.

    3. Not Very User-friendly

    Initially, Orkut was very easy to use and this attracted a lot of users. The redesigns were very complicated and most of the additions were even irrelevant to the concept of Orkut. Facebook and other social media using were found to be easier than this one. Users see social media as a source for entertainment, fun, and relaxation and hence they expect it to be very simple. Orkut shut down reason being that people started deleting their accounts on the platform.

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    4. Not Mobile-friendly

    As Orkut started becoming famous, mobiles and other smaller devices started becoming popular and most users preferred using the same. With this, Orkut could not cope with the changes. Orkut found it very difficult while Facebook catered to customer needs. Also, since it was slow, it was not very comfortable for the users to use it on mobile devices.

    5. Google Diverted Its Attention Towards Google+

    Google being very successful and developing, started focusing on other projects that were unique like YouTube. With the introduction of Google+, which is also a social media platform that had more features, Google wasn’t giving enough importance to Orkut.

    6. Users Preferred Facebook

    Customers and users found that Facebook was better for them than Orkut. Facebook had the ability to update quickly to users’ needs. They were able to find out exactly what the user needs and update the website accordingly. Adding the privacy feature was one of the best decisions that Facebook had taken. If only Orkut had tried this first, they would have been in the market for a little while.

    7. Not Business Friendly

    Orkut was limited to personal interactions, while Facebook became the platform for online marketing and advertisements. Facebook also had many additional features such as games, liking posts and sharing which are crucial for marketing whereas Orkut lacked those features.

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    Conclusion

    With this growing trend, it is very important for companies to work on capturing customers and work more towards retaining customers. Orkut failed in all of this. Market trends and customer psychologies keep changing and Facebook and other social media sites were changing according to it but Orkut failed to do the same and instead they made it more complicated.

    Also, Google, on knowing all this, could have worked more on Orkut and made it better. Google also proved to be successful in other ways. From Orkut, there is one lesson that startups and other companies can learn. Coping with competitors is extremely important. Orkut, being launched by Google, could do it but still failed to do so.

    Also, all customers expect a lot of things from companies and it is the company’s duty to fulfil all of it or at least some of it. Orkut failed in that too. Very small mistakes have led to the shutting down of a company that was started by Google. After all, little drops of water make a mighty ocean and hence little mistakes that companies do can put them in a very bad place.

    Frequently Asked Questions

    Is Orkut still working?

    Shutdown. On June 30, 2014, Google announced that Orkut would be shutting down completely on September 30, 2014. Users could export their photo albums before the final shutdown date. Orkut profiles, scraps, testimonials, and community posts could be exported until September 2016.

    Who invented Orkut?

    Orkut Büyükkökten. Named after its creator Orkut Büyükkökten, a Turkish engineer, the social media platform enjoyed unparalleled popularity in Brazil and India, especially among the 20-somethings. Today, they remember Orkut as something they ‘did’ before Facebook.

    Why did Orkut fail and Facebook succeed?

    Facebook was the main reason behind Orkut’s failure. Though redesigned several times Orkut was not able to retain its user base. Facebook kept it as simple as it could for the user so Orkut’s loss was Facebook’s gain. Orkut never tried really to take up to revive itself.

    Is Orkut coming back?

    Orkut might come back but rename as Hello

    Why did Orkut shut down?

    Orkut was one of the most visited sites in countries like India and Brasil in 2008. However, it had to be shut down due to the growing legal issues.

    Orkut vs Facebook, which is better?

    Facebook is better than Orkut because it has more security, while Orkut has less chance of malware.

    When did Orkut shut down?

    Orkut was shut down by Google in 2014.

    What happened to Orkut?

    Many other social media sites became more popular than Orkut so the users shifted to them.

    Which countries are the biggest users of Orkut?

    Orkut is popular in countries such as Brazil, Paraguay, India, Pakistan, Portugal.

    Who is the owner of Orkut?

    Google is the owner of Orkut, while the Orkut founder is Orkut Büyükkökten

    Orkut or Facebook which came first?

    Orkut came out in 2004 just ten days before Facebook was launched.

  • Why Google was hit with $123 million Antitrust fine in Italy

    Google has been fined by the watchdog of Italy in regards to abusing its dominant position in the market. Google already has a dominant position in the market through the Android smartphone platform. The tech company has been facing a lot of antitrust decisions in the recent years from the European Union. Let’s look at why the tech company has been fined by Italy’s watchdog.

    Details of the Fine
    Reason for the Fine
    The Competetion
    The ACGM
    Google’s Response
    FAQ

    Details of the Fine

    Google has been fined by the watchdog of Italy which is estimated to be around USD 123 million for abusing its dominant position in the market. The case is related to the modified version of Google’s OS which is used in cars known as Android Auto.

    The case is specifically concentrated on restrictions made by Google on their platform towards an electric car charging app called juice pass which is made by an energy company called Enel X Italia.

    Reason for the Fine

    Android Auto is a feature offered by Google for the drivers and motorists to access the maps and music streaming device while the vehicle is on the run through a dash mounted device. But Enel X Italia is a third-party app that was denied access to provide its features on Android Auto.

    Enel X Italia’s mobile app is available through the smartphone version of the android platform but the users can’t use it or are supposed to use their phone while driving. So, the restriction of access of the app on the Android Auto is equal to cutting down their competition.

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    The Competetion

    The authorities have conveyed that the Google Maps app which provides basic services for the Electric vehicles such as finding and getting directions to charging points is available through Android Auto.

    According to the findings of certain authorities, Google did not allow Enel X Italia to develop a version of the JuicePass app which would be compatible with the Android Auto OS.  

    The JuicePass app had features that would be compatible with the motorists with safety. The app would let the motorists to find an electric vehicle station, providing directions and even reserving a place at the station.

    By restricting the availability of the app on the Android Auto the authorities claim that the company has favored its Google Maps which currently provides the features of finding and locating charging stations and in the future can provide the features such as reserving a place and payment.

    The ACGM

    The AGCM has conveyed that Google had violated the Article 102 of the treaty on the functioning of the European Union and has given an order to make the mobile application of JuicePass available on the Android Auto platform.

    They also added that Google will have to provide the same access towards the Android Auto to other third-party app developers. AGCM has conveyed that it has concerns about whether Google’s restrictions on apps would have an impact on the electric mobility market.

    They added that if this was going to continue then it would permanently impact the future of JuicePass and reduce their user base when the electric mobility market is developing in the country. This would reduce the choice for the consumers and also act as a barrier to innovation.

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    Google’s Response

    Google has denied the accusation and has conveyed that they haven’t done anything wrong. At the same time, the company hasn’t confirmed whether they were planning to appeal. The tech giant has confirmed that the restrictions that they place on the applications are necessary to maintain the safety of the drivers.

    They conveyed that they have been opening up the platform to more apps over time with thousands of them being more compatible. They have conveyed that they intend to expand its availability.

    Google has said in a statement that they have strict guidelines on the types of apps which are currently supported and these apps are based on certain industry standards and driver distraction tests. They said that they disagree with the decision of the authority and are planning to review their options.

    FAQ

    What is meant by antitrust?

    Antitrust laws are regulations that encourage competition by limiting the market power of any particular firm.

    What are the 3 antitrust laws?

    The three major antitrust laws in the U.S. are: the Sherman Act, the Clayton Act, and the Federal Trade Commission Act (FTCA).

    What is ACGM in Italy?

    The Italian Competition Authority or AGCM is the Competition regulator in Italy.

    Conclusion

    The AGCM has said that it would monitor the compliance of Google so that it ensures to order it effectively and implements the obligations correctly to provide access to third party apps through Android Auto.

  • Microsoft Vs. Apple: Analysis About Their Business Model

    Microsoft Corporation and Apple, Inc. are leading companies in consumer access and technology. They are competing each other in so many sub-industries, such as operating systems, mobile devices, hardware, advertising, software, Web browsing, applications, etc. Microsoft and Apple have a different business model.

    They are the two largest companies in the world.  The business model of Apple is based on customer-centric devices and innovation. Microsoft’s business spanned across Windows, Office products, Gaming (Xbox), Hardware, Web search engine (Bing), Cloud, LinkedIn, etc. They have a diversified business model. They changed their business model by starting to release their own devices.

    These 2 companies made a revolution in the technology industry. Both companies have chosen a different way for the adoption of enterprise. These tech giants succeeded in the enterprise, using different strategies. Both companies have a different approach from the philosophical and organizational perspective The analysis about the business models of these 2 companies are given below.

    Business model of Apple

    Apple, Inc. was founded by Steve Jobs, Ronald Wayne, and Steve Wozniak on 1976. It is one of the most successful companies in the world. The company offers software services and technology products. The headquarters of the company is situated in California, USA. Currently, Tim Cook is the CEO of the company.

    Steve Jobs

    Apple 1 computer is the first product of the company. After that, Apple provided so many services and products. iPhone is one of the most successful products from Apple. iPhone had a sale was  $142 Billion in 2019. It represents the 54% of Apple’s total revenue. Its total revenue was $260.174 Billion in 2019.

    Strengths

    Apple is one of the most valuable brands. It has a brand value of $140 billion in 2020. Apple is a reliable company in the industry of smart technology devices and advanced computers. The loyal customers, who number in millions is one of their major strengths. And also, they have top technology.

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    Apple introduced some innovative products such as iPads and iPhones. They are still determined to manufacture the best technology devices. Apple Company provides a specific business page to its customers. According to customer’s needs, It gives technology solutions of top quality.

    Apple gives more dedication into designing of their products. According to customer needs, they are doing more researches. Apple introduced an iPhone recycling robot named “Liam”. It is used to disassemble of iPhones. The reusable parts are safely stored. Those parts are used for new manufacturing.

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    The company is expanding their services portfolio. The 16% of their total annual revenue (2019) comes from its services. It is the second largest contributor to its total revenue. iPhone (54% in 2019) is the biggest source of company’s total revenue. In 2019, Apple Company introduced so many new services. It includes Apple Arcade, Apple TV+, Apple Card, and Apple news+.

    Annual revenue of Apple from 2016 to 2019

    Weaknesses

    The products from Apple considered as a luxury item due to the high prices. Apple’s products are not affordable for low Income consumers. Most of their customers are middle or high class individuals. Apple has only limited advertising resources. Company’s marketing mainly depends on their flagship and iconic retail stores.

    Apple released their mapping service named “Apple Maps” in September 2012. It was a failure. They are swiftly entering into new services (game streaming, video content streaming, and credit card) and competing with the major players such as Disney, Netflix, City, Paypal, Chase etc. The products of Apple do not support other technologies or softwares. So Apple’s products are incompatible with other devices.

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    Customers have to buy Apple accessories or apps to continue the using of products from Apple. They received payments to make search engine of Google company as the default search engine for their Safari web browser. Because of this, the company is under investigation. They have been accused of using tracking apps in phones to find the location of users. But in their latest version of phones provides the right for users to decline the tracking.

    Business model of Microsoft

    The Microsoft is an American multinational technology company. It was founded by Bill Gates and Paul Allen on 1975. The company offers office software suites, devices, apps, cloud computing, operating systems, hardware and software products. They are one of the leading companies in software market. The headquarters of the company is situated in Washington, USA. Currently, Satya Nadella is the CEO of the company. They are forefront of the technology industry for more than 40 years.

    Bill Gates

    Strengths

    Microsoft is considered as the market leader in the industry of software technology, especially in cloud computing. They are the developers of Windows operating system. Azure is a public cloud made by Microsoft. Company’s total revenue was $126 billion in 2019. Microsoft is one of the top 5 cloud service providers in the world.

    The Microsoft has a brand value of $117 billion in 2020. The company operates their business in more than 190 countries. They launched a promoted version of Windows 10. It got more than 700 million installs. Microsoft added new stock keeping units to its portfolio. It includes Microsoft 365. The company has larger loyal customer base. It is one of their main strength.

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    They have an efficient adverting platform. The company influenced consumers through their effective and stronger marketing strategies. Their advertisement with the title “The future starts now” has touched so many peoples. Microsoft has a 4th rank in world’s most valuable brand list prepared by Interbrand. The company offers user friendly and quality products such as Office software products and Windows OS.

    They are implementing a freemium business model. Microsoft realized that paid software is a more difficult sell in an age of low-cost alternatives. Tablets and phones are replacing PCs. A newer Microsoft business model has been made by CEO Satya Nadella, who emphasizes product integration, a “freemium” software package, and a concentration on its cloud computing business.

    Annual revenue of Microsoft from 2016 to 2019

    Weaknesses

    The cyber-crime cases are increasing. It made Microsoft in a weakened state. Cyber-security of the Windows OS have faced attacks from hackers for several times. Their hardware product sales are failing to grow. It includes phones and surface pro computers. Also, PC shipments of the company have frequent falls, because of currency fluctuations and rising to vendors’ rising prices.

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    They are lagging in advanced technology and innovation. At this time, Google, Apple and Amazon are rapidly growing.  Safari, Google, and Firefox are the leaders in the internet browser market. But Microsoft is lagging in the Internet browser sector. The acquisitions of the company such as LinkExchange, WebTV, Danger, and Massive were failures. Those unprofitable investments are the major weakness of the Microsoft.

    In terms of enterprise value to free cash flow and price to earnings ratio, the market value of Apple is currently higher than Microsoft. Apple has a market capitalization of $1.904 trillion in August 2020. But Microsoft has only $1.607 trillion in this time.

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    The analysts said that there will be a 15% compound annual earnings growth for Microsoft and 11.5% compound annual earnings growth for Apple in the next 5 years. The both companies have crossed the market capitalization value of $1.5 trillion. Now their next target is to reach the market capitalization value of $2 trillion.

  • How Are Companies Leveraging Community To Connect And Engage With Their Customers?

    In the recent times of cut-throat competition among brands, community building has become an essential task for the companies to keep their customers engaged and keep the communication flow intact. More and more companies are turning to leveraging community to connect with their customers and interact with them in a less sales driven way.

    Community building also helps the companies with customer support and marketing. It also offers opportunities to understand the behaviour of your customers. Communities create shared experiences, when built on the same values. Many businesses have already understood the importance of customer communities.

    However, not all communities are the same. There are many different kinds. The one that you settle on will depend on your business, your audience and your resources. Thus, we interacted with top executives from different companies and they shared their views on ‘How are companies leveraging community to connect and engage with customers.‘

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    Akhand Swaroop Pandit- Founder and CEO, The Catalyst Group

    During disruptive situations like the ongoing COVID-19 pandemic, it is crucial to focus on business-critical initiatives. As a brand, you must continue to remain relevant, affable and approachable in such times to foster trust and dependency. The objective cannot be to leverage the ongoing crisis to attract newer customers; your actions have to be rooted in advising your customers, and ensuring brand recall among your existing customers and partners. Marketers play a critical role in enabling seamless engagement with customers, salesforce, partners and employees.

    While you can always plan ahead for contingencies, there are behavioural and attitudinal changes that are required to cope with such situations. Marketers have to be agile, quick, and fast thinkers to adapt to these situations. The existing product communication has to overhauled to make it more relevant, and one must realise that customers are adapting to the situation with you.

    At Catalyst Group we are using such techniques through providing quality online lectures on our YouTube channel and other social media platforms for free. This is to encourage the students and to make them comfortable with online learning which will be a definite requirement in the near future. Even during interaction with students who want to enroll for our courses, we provide expert advice and career counselling.

    This helps the students select courses that fits their requirement and skillset. Adventurism and experimentation has to take a back seat and concentrating on the development needs of the society as a whole must come into focus. Further on this, for our existing students, we are also providing free mental counselling sessions.
    While in the recent years digital has been the buzz word, every brand has been forced to transform their processes and operations to digital. Especially for the education sector which was always traditionally relied on physical interaction, it is important to make a quick transition to newer platforms, which in today’s age is digital.

    Most important of all, you have to be cognisant of the fact that the situation will normalise. So, prepare for that impending normalcy and how your brand will make that transition too.

    Mihir Shah- Co-Founder, YesssWorks Spaces Pvt. Ltd.

    Mihir Shah- Co-Founder, YesssWorks Spaces Pvt. Ltd.

    We have a very vibrant and engaged community of coworkers from diverse companies who have got to know each other through various events organized at YesssWorks. We introduced a Community Testing program wherein individuals can opt-in to support beta testing and provide valuable user feedback to startups looking to launch their products or services.

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    Companies have found this feedback immensely helpful in tweaking their products potentially saving time and money. We are now evaluating formal rollout of the Community Testing program across all YesssWorks hub by building tools into our tech platform to deploy product, garner feedback and interact directly with the community.

    Shivjeet Ghatge- CEO & Co-founder, StepSetGo

    It is very important to understand that in most cases it’s an individual that introduces a specific brand or product to a certain community. Whether an influencer, a peer, or a family member, the ability for that one person to successfully convert another, depends on two factors – one, the uniqueness or trendiness of the brand or product, and two, an actual positive display of proof-of-concept.  This was something that we experienced first hand with StepSetGo.

    When we opened our platform to the public, we started off by doing a small dipstick at the NMIMS college. I personally went to the college grounds, explained, and enrolled members onto the platform, and on that first day itself, we had about 200 users. Initially, a lot of individuals looked at us with absolute disbelief, that through simply earning SSG coins by walking they could potentially buy clothes, gadgets etc.

    However, the minute one user witnessed a member within their social circle actually reap the benefits of their walking rewards, a proof-of-concept was established and it created a ripple effect where we landed up gaining almost 55,000+ users everyday within out first quarter.

    Anshul Gupta- Co-founder of BOX8 (Poncho Hospitality Pvt Ltd) and MOJO Pizza

    The community that we largely focus on is our repeat customer audience. We do everything to pass on maximum value to them – whether it is providing 2X toppings on the pizzas, or delivering the orders within 30 minutes, or giving them the best discount offers.

    We listen to their feedback at every step through various channels. Our Brand Managers write to customers personally asking them about their experience, and go through every response. We have a dedicated team that constantly works on analyzing the feedback & making necessary changes.

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    A large chunk of our orders come from repeat customers. Focusing on them helps us gain customer loyalty and word of mouth. Most of our customers have told us that they got to know about MOJO Pizza via their friends & family.

    Rohit Gera- Managing Director, Gera Developments

    Rohit Gera- Managing Director, Gera Developments

    We have been conducting on-ground workshops and events for our customers anchored in our goal to nurture communities. With celebrity academy tie-ups as part of our ChildCentric® Homes product segment, these have ranged from star-studded events with Shankar Mahadevan, Shiamak Davar, Mahesh Bhupathi, Bhaichung Bhutia to name a few, to concerts by Shankar Ehsaan and Loy to tailored learning and engagement workshops for children to launching our business engagement platform, LINT expanded as Learning Inspiration Networking Training, for our commercial project customers.

    We believe in going beyond just constructing homes and offices to building communities and nurturing ecosystems. Through the lockdown, while everyone was adhering to the lockdown guidelines, the monotony of the routine, we learnt, was becoming a dampener. To enliven the situation and give our customers’ families fun opportunities to bond over, we initiated virtual workshops with experts from our celebrity learning academies.

    This initiative is our way of telling our loyal customers that we are with them even in these difficult times. Excelling at customer service and giving them the best experiences, is at the core of our service philosophy. Businesses will go through changes so also customer engagement approaches, we must adapt quickly and embrace the new normal to be relevant and outdo.

    Sujay Kalele- Founder, Trurealty

    Sujay Kalele- Founder, Trurealty

    At TRU Realty, the concept of keeping our customers at the heart of all our activities has been etched in our very fabric. We put tremendous efforts in delighting our customers at each stage of the sales cycle and hence, have created many touchpoints for flawless experience with the help of AI, big data analytics and 24*7 access to TRU portal. Simultaneously, we strongly believe that communities have the potential to run businesses with lower risks and higher returns.

    An exhilarating experience coupled with risk free investment in a project can be the most sought-after proposition for customers. When we create a community of such delighted customers, we inevitably get accepted in their closed circles, and word of mouth and personal references lead to higher reliability and trustworthiness. Apart from customers, we also work with other stakeholders and create communities for them.

    We recently concluded an event for the Architects community (Design Competition) wherein approx. 1000 Architects registered with us.

  • The Five Forces Model to Determine Your Industry Competition

    The competitions are increasing rapidly in marketplace. These increasing competition can cause threat to every ongoing business. So it becomes important to determine such competitions and make strategies to exist in the market.

    What is Five Forces Model?
    Five Factors to Analyse Industry Competition

    What is Five Forces Model?

    Porter's Five Forces Model
    An Insight of Porter’s Five Forces Model

    The Porter’s Five Forces of Model is a tool which analyses a business competition and helps determining the level of competition an industry can face. This model was given by Michael Porter (a Harvard Business School researcher) in 1979.

    The tool focuses on five forces which can have an impact on the whole industry. Even after 40 years, it’s one of the effective methods widely used to do competition analysis.

    Five Factors to Analyse Industry Competition

    Porter's Five Forces Model
    Five Factors of Porter’s Five Forces Model

    According to this model, the five factors to analyse industry competition are:

    1. Threat of Entry

    We have already seen the rapid competition among the brands and industries. The new brands entering the market are creating competition for the existing brands as well as in the industry. But what if there are high cost and lots of process required to enter in the industry? There will an entry barrier among such industries.

    But what if it is easy to set up a business in the industry? Then there will be more threat of upcoming competitors in the market. So under this factor, the threat of entry will determine the industry competition. If there are difficult or strong barriers then business will have fewer competitors.

    For Example: It is not easy to enter in the Airlines Industry as it involves huge cost. So the industry will always have few players than most industries. But it’s easy to set up a café in the town. So there will be more players or more threat of entry in this field. The business dealing in the industry will be able to earn a limited amount of profit because there are more players in the market.

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    2. Threat of Substitute Products or Services:

    There are industries which have no or few close substitutes available in the market. But there are also industries which have one or more substitutes available in the market. The companies dealing in the industry with no or few closer substitutes will have an advantage than the ones with more substitutes. Even if the company increases its price to earn more profit, the customers will have to buy the product.

    But in the other market with more substitutes, if the companies increase the price then the customers will switch to substitute products. So the number of substitute products or services will determine the competition of the industry.

    For Example: There are more vehicles running on petrol, so the increase in the price of petrol won’t cause any change in the demand. There are no options available with them. But if the price of coffee will get increased, then people may switch towards tea (which is closer substitute of tea).

    3. Industry Competition

    An industry competition comprises the total companies which deal in particular industry. If there will be a large number of companies in the same industry, then the competition will be high. There will be cut throat competition in the market. Even a single change in the price or quantity can show more response in the market. The consumer’s enjoy lots of available opportunities with them.

    If companies increased a slight price in the competitive environment, then the customers will switch to other suppliers. If any company started giving exclusive deals and products at discounted rates, then the customers will move towards such business. The customers’ loyalty is diminishing these days. Consumers are much focused towards getting quality products at cheaper rates.

    In such a market, the businesses are dependent upon market forces to determine the prices. But if there is less competition in the industry, then the companies will have the advantage of maximising the price and earning huge profits.

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    4. Bargaining Power of Suppliers

    In the market, the powers remains among such businesses whose products are more demanded and few suppliers are there. So if you deal in such a business where the raw materials are heavily demanded and available with few suppliers, then you may have to suffer from the strong bargaining power of suppliers.

    The suppliers can sell the materials at a higher price, and you have to take it because you need raw materials to run your further business operations.On the other hand, if there are more suppliers and raw materials are easily available, and then you will be able to buy materials at fewer rates.

    Suppose, a person running a shoe manufacturing unit will be dependent upon the leather. If there are less leather suppliers then the shoe brand will have to pay more to get leather. His business unit will solely be dependent upon leather because he cannot make shoes without it. So anyhow, he will have to buy the leather even at high price.

    Also Read: How to Make Customers Loyal?

    5. Bargaining Power of Buyers

    The business enjoys huge profit if the product is scarcely available i.e. heavily demanded but quantity is less. Whenever the demand of product gets increased, its price also gets increased. The heavy demand of products requires more products to be supplied. But due to the limited availability, the product only reaches in few hands.

    There will be more buyers in the markets, but few sellers. In such a case, the buyers will have to accept the product even at high price. But consider if there are more sellers in the market? In this case, the buyers will have more power to bargain and get their price reduced.

    So the business will have to sell products at less cost. By this way, he will earn low profits. If the business doesn’t reduce cost, then the customer will switch to other seller and his stocks will remain unsold.

    The customers become more sensitive to price if they find more options in the market. If the industry has more sellers, then the company won’t be able to earn more profit. He will have to agree with the buyer, because of large number of sellers available. So companies dealing in such industry will have more threat to buyer’s bargaining power.