Courgeon Benjamin Master MBS

Samsung and the theme park industry in Korea

Question: Is the global theme park industry an interesting industry to be in?

To answer to this question we will use Porter’s five Forces model and explain this one:

Porter’s five Forces model:
New entrants

Suppliers
Buyers
Competitors/ field of theme park

Substitutes

Before to complete this one, we will develop each Force:

Rivalry between established competitors: The sector of theme grew strongly during the 90s as show the growth of China’s theme park industry between 1990 and 1993. (Revenues increased over 2 000%). But nowadays this sector reaches the maturity stage of the cycle life.
In each country we have few competitors so we can say that the competition is concentrate. But in the world this industry isn’t concentrate. The 4 biggest players haven’t together more than 80% of market share. Furthermore competitor haven’t the same size and haven’t a specialized offer. Indeed we find the same type of amusement machinery, the same fast food and beverage on each theme park.
Approximately theme park have the same price and provide the same services, the only difference is the “theme” of the park (example Astérix) and the type of the park (example aquatic). This service is really simple for customers who are only “spectator” (they don’t have to control the ride).
But each theme park has the same difficulties to control the seasonality and the economy of scale and the same exit barriers which are high, because you can’t easily sell a theme park and it’s not free to dismantle...
Threat substitutes: they constitute an important threat, because they are many and have many advantages with regard to theme park. Indeed most of substitutes are free or less expensive like cinema, camping trip, beaches, movie at home etc…
However other leisure activities are more easily accessible because theme parks are few and often consumer have to do many kilometers