Question

Barb, a single mother of five children, chooses to go to Payless Shoes to purchase her children's shoes rather than shopping at Zappos.com. This is an example of which of Porter's Five Forces?

A) rivalry among existing competitors
B) supplier power
C) threat of new entrants
D) MIS

Answer 1

A) rivalry among existing competitors

Step-by-step explanation:

Since Barb chooses to go to Payless Shoes to purchase her children's shoes rather than shopping at another shoe seller Zappos.com, this is an example of rivalry among existing competitors .

In Porters' five forces, Competitive rivalry measures the extent of competition between existing firms. This rivalry can trigger price wars (including price cutting) which result in limitation of profits. It also involves increased advertising costs, higher research and development on service/product improvements and innovation, etc.