How Etsy can tackle Threats of substitutes products or services : The threat of a substitute product or service is high if it offers a value proposition that is uniquely different from present offerings of the industry. For example services like Dropbox and Google Drive are substitute to storage hardware drives.
When a new product or service meets a similar customer needs in different ways, industry profitability suffers. Threats of substitutes products or services This way it will be able to attract a large number of buyers. Etsy Inc can take advantage of its economies of scale to develop a cost advantage and sell at low prices to the low-income buyers of the industry.It can do this through marketing efforts aimed at building brand loyalty. Etsy Inc needs to build a large customer base, as the bargaining power of buyers is weak.Product differentiation and quality of products are important to buyers within the industry, and Etsy Inc can attract a large number of customers by focusing on these. Etsy Inc can focus on innovation and differentiation to attract more buyers.How Etsy can tackle Bargaining power of buyers : the higher the bargaining power of the customers and higher their ability to seek increasing discounts and offers. The smaller and more powerful the customer base is of Etsy, Inc. They want to buy the best offerings available by paying the minimum price as possible. As the industry is an important customer for its suppliers, Etsy Inc can benefit from developing close relationships with its suppliers where both of them benefit.īuyers are often a demanding lot.This way it can ensure efficiency within its supply chain. For example, Etsy Inc can have different suppliers for its different geographic locations. It can have multiple suppliers within its supply chain.If the costs or products are not suitable for Etsy Inc, it can then switch its suppliers because switching costs are low. Etsy Inc can purchase raw materials from its suppliers at a low cost.How Etsy can tackle Bargaining power of suppliers : The overall impact of higher supplier bargaining power is that it lowers the overall profitability of Specialty Retail, Other Powerful suppliers in Services sector use their negotiating power to extract higher prices from the firms in Specialty Retail, Other field. Suppliers in dominant position can decrease the margins Etsy, Inc. This will help it retain its customers rather than losing them to new entrantsĪll most all the companies in the Specialty Retail, Other industry buy their raw material from numerous suppliers. It can spend on marketing to build strong brand identification.