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Social Listening: Can Porter's Five Forces Help Determine Brand Impact?

Social Listening: Can Porter’s Five Forces Help Determine Brand Impact?

As more organizations emerge, close-knit competition has become unavoidable. Therefore, to stand out from the crowd, social listening or social media listening is an important skill to master. 

In the age of social media, brands have begun reaching out to customers through social networking sites. About 51% of brands have already started utilizing social listening, whereas 63% believe that by the following year, social media listening will become one of the topmost priorities of every business. 

51% of brands have already started utilizing social listening.

Thus, as more than 3.6 billion people are on social media worldwide, it will be advantageous for companies to use social networking sites to connect with customers and market their products. It is so because the number will rise to 4.41 billion by 2025.

3.6 billion people are on social media worldwide.

But before delving into exploring the aspects of social listening as a marketer, it would be better first to evaluate the competitive edge your company holds. This way, you will be able to identify the strengths, weaknesses, and how to best capitalize on opportunities for future developments. 

Hence, Michael Porter’s Five Forces Model is one of the best ways to begin an evaluation of your company’s competitive advantage in the market across different sectors. 

Porter's Five Forces

What is the Porter’s Five Forces Model?

Michael Porter’s Five Forces is an analytical model introduced in 1979 to understand the attractiveness of an industry. It describes the five main economic forces to explore the environment in which a product or company operates. 

The model intends to help managers and entrepreneurs understand the industry’s competitiveness through the economic forces. 

Thus, Porter’s Five Forces are responsible for pinpointing the strengths and position of a company in the market. It also lists the three significant aspects of corporate planning:

Statistical Analysis

The five forces analysis model deals with the attractiveness of an enterprise in the industry. It decides the entry or exit of a company into the market. Thus, the statistical analysis involves exploring its profitability. 

Under this, you can also compare the competitive rivalry with competitors in the market segment. As an entrepreneur, you can learn about the competitive market’s impacts on your company. 

Here, you might also glimpse at various other options and resources that the competitors would propose to influence the industry structure. 


Dynamical Analysis

A dynamical analysis identifies the growth drivers after garnering an overview of possible competitive challenges faced by the company. Moreover, it uses PESTLE and SWOT analysis to find the growth stimulating factors. 

Besides providing a deeper insight into future risks, it also gives information about political, economic, social, technological, legal, and other company demographics. 

Dynamic Analysis

Available Options

After analyzing most of the competitive aspects, this part proposes the possible solutions for the organization lest they combat the stiff competition. For example, to improve the competitive attractiveness of your company, you have probably come up with solutions to either start a new product or service or make modifications to the existing one.

But to apply social listening with Porter’s 5 Forces, a deeper understanding of the model is essential. 

Understanding it in detail

Generally, companies and marketers utilize Porter’s Five Forces to explore the profitability of their enterprise in the market. The analysis is usually done when a company enters a new market or starts a new service/product. The five economic forces are responsible for the model.

The five forces of the model are as follows: 

Competitive threat

As an entrepreneur, the first and foremost aspect of the analysis is how much competitive pressure your company faces. It is so because the more competitive rivalry your firm faces, the more challenging it will be to earn profits. Competitors can provide the same product at lower prices, attracting buyers’ attention. 

Thus, the more competition, the more options for buyers and more room for negotiation. It results in dismal profits. 

Some of the points to consider in this situation include the following:

✅   Number and strength of existing competitors in the market

✅  About the competitors (the type of products sold, quality of products, and prices)

✅  Difference in products between you and your competitor

✅  Will it be beneficial for customers if they switch sides?


Threat from new entrants

A company’s competitive edge is affected by the entry of new and existing competitors. The less capital and startup costs are required for setting up a company, the more it can weaken an already established company and vice versa. 

Therefore, an industry that has imposed significant barriers to letting in entrants will likely have fewer competitors. Thus, the company can charge higher prices without negotiating with buyers or suppliers. 

Some of the points to consider in this situation include the following:

✅   Know about the requirements for entry into the industry

✅   Keep backup money and plan a scalable business

✅   Be updated regarding the latest news for policy changes

Terror from substitute products

When a customer switches to other sellers for a service or product you used to provide, it harms the profit of your business and overall brand loyalty. It is so because, following one person, other people might also join. That is why it is vital to know the substitute products on the market and how to keep improving yours. 

Some of the points to consider in this situation include the following: 

✅   Is the substitute product better in terms of price, quality, durability, and long-term solutions?

✅   Why do the customers prefer it over yours?

The bargaining potential of suppliers

The profit of a business depends upon the difference between its cost price (the price at which it buys from suppliers) and the selling price (price at which it sells to buyers). Therefore, if in an industry, the suppliers are limited (like in aviation, where fuel prices are non-negotiable), the company will have no choice but to abide. 

Hence, this results in a sudden shift in favor of suppliers’ bargaining power. However, if in an industry there are ample suppliers available (like automobile and electronic spare parts vendors), the bargaining power of suppliers will subside because now the company has room for negotiation. 

Some of the points to consider in this situation include the following:

✅   Explore the nature of suppliers or vendors in this field.

✅   Find as many suppliers as possible by keeping in mind that the budget is affordable.

✅   Negotiate the price accordingly with the suppliers. 

The bargaining potential of buyers

The bargaining power of buyers is quite determinative, especially if the company faces stiff competition. The bargaining potential of buyers fluctuates with price changes. Hence, if:

✅   The competitors provide products or services of better quality

✅   The competitors provide products or services at lower prices. 

Thus, the company will either be forced to reduce its prices or willfully allow the customers to switch their sides. However, if the number of competitors in the field is lower, the customers will have to put up with the price and quality offered by the company. 

Some of the points to consider in this situation include the following: 

✅   Evaluate the options present for buyers in the market

✅   Evaluate how the competitors are setting prices 

✅   In what scenarios can a customer switch sides, and how to stop it?

Benefits for brands

Porter’s Five Forces model demonstrates how relative industry forces affect your company in the market. By applying the five forces model, organizations can yield the following benefits:

Understand the competitive market

The analytical model measures the threat from each of its segments (competitive rivalry, the threat from new entrants, switching to substitute products, and bargaining power of sellers and buyers) to provide a detailed layout of your company’s position in the industry. 

It will help you identify at least three strong competitors in the marketplace. This way, you can brace yourselves and prepare a corporate strategy to combat stiff competition.

Competitive Market

Identify your strengths and weaknesses to create opportunities

The Porter’s Five Forces Model helps to pinpoint the strengths and weaknesses of your company while analyzing its competitive attractiveness. It is so because once you know the pain points, you can conjure solutions for them. 

The model more or less also evaluates the possible threats or pressures in the marketplace. Therefore, the management teams can take precautionary steps by finding where the threats exist. Ultimately, it will also enhance the strengths to create better opportunities. 

This happens when a business expands prosperously because of strength enhancement and threat minimization. Once the business grows, you can move forward with integration and incur favor from consumers. It reduces the bargaining power of consumers, suppliers, and threats from new entrants. 


Assist with future threats and changes

The model will look into all aspects of a company. Therefore, its report will also reveal possible future challenges besides evaluating present risks and opportunities. That is how you can prepare your responses to those threats in advance. 

If you keep conducting the model survey regularly, it will also update you on the recent changes in the marketplace. Hence, you can make appropriate adjustments to your corporate strategy accordingly. 


Formulation of helpful vision strategies

Corporate strategy planning is a critical part of a company because it acts as its growth driver across all sectors. That is why to create a formidable future vision; the company should develop an accurate corporate strategy by considering the dynamic changes in the industry. 

How to leverage it?

The marketer should garner ample market knowledge about the company and the marketplace. In this way, the leverage of the five forces model becomes easier. Here are some of the tips to consider while leveraging the analytical model. 

Evaluate your competitor’s strength

Measure the market share of the top organizations (in your field), irrespective of your capital and operational area. Do broaden your search area by finding direct competitors in your field and narrow it down to those similar in size and operation. 

Figure out the weak points of your competitors while counting the strengths. Also, see if you have many advantages over others. For this, you can:

✅   Be a diligent visitor to their social media handle and have a look at the type of posts they make.

✅   Keep an eye on the comments and see what their customers desire. You can compare that with the services you provide (you may also find customer complaints here that you can use to your advantage).

Measure your bargaining power with your suppliers and buyers

To understand the bargaining power of your suppliers:

1️⃣   See the company from a buyer’s perspective.

2️⃣   Evaluate their power by understanding whether to buy in bulk or less.

3️⃣   Try to keep buying options from various suppliers open to reduce their bargaining potential. 

Similarly, while selling to buyers, be sensitive to price fluctuations and better understand your customer volume. Once you know which section of customers is your growth driver, manipulate your market operations accordingly. 

Calculate the threat of new entrants and substitutions 

Evaluate the industry’s demographics to understand the requirements for setting up a new business or beginning a new service by:

Startup costs and capital requirements (essential to advanced), government regulations to follow, number of suppliers available, the composition of buyers, and R&D costs evaluation. 

In this way, you will be able to identify the possibility of a threat from a newcomer. Similarly, to understand the danger of substitution, find out:

✅   Uniqueness of your product compared to direct competitors

✅   How possible is it for competitors to disrupt your business?

✅   Benefits of switching from your product

In such cases, circulating feedback forms are the best option so that you can find customer dissatisfaction points and ease them. 

Draw the final strategy

After analyzing all the threats, discuss them with your management and marketing team. For further analysis of solutions to each aspect, draft a thorough report about your findings. 

Then, based on this, seek ways to implement your corporate strategy step-by-step. 

Some branding examples

Porter’s Five Forces is a clear-cut analytical framework that is a valuable tool for organizations. Hence, let’s look at examples of five forces analysis leveraged by managers and entrepreneurs across various industries. 

The International Air Transport Association (IATA)

IATA recently published its Vision 2050 Report, a prime example of Porter’s Five Forces implementation. The report shows how airlines, vendors, and buyers profit in the aviation industry. 

The cheaper the airfare (less profit for airlines through ticket prices), the more customers inflow (more passengers will board) because flying has become affordable. This reduces the bargaining power of customers. 

However, due to fluctuating fuel prices (usually high), the aviation industry has to raise its maintenance costs regularly and regulate prices to stay steady in the market. This suggests the bargaining power of suppliers. 

To summarize, the aviation industry does not face threats from new entrants because of the high cost of setting up airlines, fuel costs, and other maintenance. However, there are chances of passengers switching to different modes of transport (or other airlines) because of differences in fares (as mentioned before). 


Apple Inc.

By applying the five forces analysis to Apple Inc., you will know that although Apple has remained largely unchallenged, it still faces challenges in terms of competitive rivalry and the threat of switching to substitute products. 

Apple does not face a threat from new entrants and the bargaining power of buyers because if a new entrant does come, it will take a considerable amount of time and capital to set up a credible brand image like Apple. Thus, buyers would not be easily influenced and put up with the items from Apple without bargaining. 

It also finds fewer obstacles in terms of the bargaining power of suppliers because Apple has an ample number of suppliers. As the industry of suppliers of electronic parts is highly competitive, no supplier would lose good business to Apple. 

However, Apple faces direct competition from other sellers (like Google). Thus, there are also high chances that its buyers will switch to other products.



Starbucks is an American coffeehouse company with over 33,000 stores in over 80 countries. As a beverage seller, Starbucks faces stiff competition from various other companies in the market. 

Due to its small number of buyers, expensive products, and other sellers selling moderate variants at affordable prices, customers are likely to switch to substitute products and move to other sellers. Thus, to avoid the monopoly of Starbucks, its buyers buy from various sources. 

However, in terms of the bargaining power of suppliers, Starbucks sports the upper hand. It is so because Starbucks always buys its stocks from suppliers. As several supplier options are available, it would be inconvenient for any supplier to do business with Starbucks for another buyer because no other firm would buy in large quantities like Starbucks. 



Uber is a ride-hailing service where customers can book rides through the company’s app. As there are already various players in the field (like Ola), Uber faces a neck-to-neck competitive rivalry. Also, here, the bargaining power of customers is quite prominent because if the prices are deemed too high, they might switch to other alternatives.


Strategies for Success

Michael Porter’s Five Forces Model is undoubtedly beneficial for shaping your company’s competitive position. However, for its successful implementation, a suitable strategy is crucial. Therefore, here are some of the pointers that organizations can utilize for utilizing five forces analysis through social media listening:

Compile and prepare

While conducting the analysis, the survey should have answered most of your questions. Thus, start reorganizing your findings and appropriately compiling them. Side-by-side, start placing your current strategy of how you plan to put your company in the marketplace. 

You can make changes to your strategy as you proceed with further examination of your business. 

You can circulate a survey form through the company’s social media handles. There, show some options on how you plan to offer a specific service. See the responses, collect them and utilize them in your plan accordingly. 

Make your product unique

Customers tend to switch whenever a new entrant comes if the latest product from the competitor offers the same item in a better version. Therefore, you should strive to create the perfect product or service. 

Also, create a reputable brand image because, apart from relying on the product’s usability, the company’s brand name acts as a credibility guarantor for buyers (and suppliers). To do the same, you should:

✅   Be regularly active on social media to post content and respond to customer queries.

✅   Be professional, responsive, and humble while dealing with customers.

✅   Post content related to recent activities (like the launch of a new product or modifications to an existing one) innovatively.

✅   You should identify the target audience you will focus on and create your social media posts accordingly. 

Be customer-centric

Adopt a customer-centric approach by paying more attention to customer needs, pain points, and required solutions. Seek to introduce products or services that are quality-rich, affordable, and readily available to the masses. 

See how you are faring against your competition. Understand what is working for them and what is working against them. Analyze customer data from anywhere on the web and social media.

Get real-time market intelligence. Fine-tune your strategies and make valuable business decisions. Listen to the online web, social media, and a lot more. Get market intelligence and learn from your customers – to do all such things, you need to incorporate omnichannel customer experience management. 

Social listening, analytics, customer relationship management, and online reputation management can help you with your business. Konnect Insights is one solution for all your business needs.

Thus, to do the same, you can: 

✅   Start a short campaign of taking customer suggestions either through survey forms or personally.

✅   Award customers for their brand loyalty (like those who follow, regularly comment, and buy) with shoutouts, freebies, or discounts. You can also follow some of their accounts. 

✅   Genuinely consider suggestions, consider, develop, and propagate them sufficiently through your target groups. 

✅   Ask for feedback and customer service reviews. As positive reviews spread, you will attract more customers. 

If customers turn in your favor, you will successfully build a brand image, the bargaining power of customers and buyers will be reduced, and it will minimize threats from new entrants. 


Regulate the price of your product

Too pricey products or services can be afforded only by a small fraction of people (like Starbucks). This will lead to a rise in threats from new entrants, switching products, and facing even stiffer competition. 

Hence, by not compromising on quality, they maintain the best possible price. 

Final thoughts

Analyzing the competitive edge is essential to conducting business as competition is a necessary evil in the industry. 

Therefore, companies can use social listening to examine and identify threats using the Porter’s 5 Forces model to develop a prominent corporate strategy plan. It is the best way to explore the dynamic supply chain and make sound investment choices.