Porter's 5 Forces Polar, connected watches, sports-related objects, smartphones, fitness, physical health, connected watch market, GPS, heart-rate monitors
Polar is a group that was founded in Finland in 1976. It markets watches and other connected or sports-related objects. Connected watches have enjoyed growing success over the past ten years, particularly due to the fact that consumers are paying more and more attention to their physical health as well as their well-being. The first watches connected to smartphones were launched in 2014. It is from this date that users will be able to receive their notifications directly to their wrist. In the connected watches and fitness segment as a whole, this has created a real change in the expectations and needs of new consumers, the youngest, many of whom today find this type of equipment as essential in their private lives as their professional ones.
The Polar group has various activities and is now positioned both in connected watches and in heart rate monitors. The company employs 1,200 people worldwide and has a presence in 80 countries. There are also 26 subsidiaries in France and abroad.
[...] Consumers certainly want reliability, but they also want low prices. One of the many advantages of the Polar brand is that it offers different products at different prices, in order to reach as many athletes and other users as possible. The clients bargaining power is high, in the sense that they have a wide choice in the market, which helps to increase their decision-making power. The net has become over time an essential tool, which allows them to compare products with each other and to watch demonstration videos concerning them. [...]
[...] In fact, the more a product is sought after by customers, the more suppliers can impose their prices, this product being essential for the manufacturer or the distributor. While relationships between suppliers and distributors have, at times, been complicated, today they tend towards something more collaborative and partnership-based, rather than conflict. The two parties involved could not exist without each other. In the case of Polar, the suppliers need the group to work in the best possible conditions and to continue to supply quality materials to continue to exist. [...]
[...] We will first discuss the threat posed by the entry of potential new entrants into the market, as well as the threat posed by substitute products. We will then see the bargaining power of suppliers as well as that of customers. We will finish our analysis by studying the existing competition. II. Porter's 5 Forces for Polar A. The Threat to New Entrants This threat is generally quite high in the field of connected watches. Despite the strong notoriety of the Polar group, new players are gradually entering the market because they are aware of the commercial niche that surrounds it. [...]
[...] Garmin and Polar are in the top 10 manufacturers, with other players such as Xiaomi in particular. This is a segment that has seen its notoriety increase over the years, as well as its number of users. At the end of 2019, the connected watch market was worth several million euros; it also grew by more than 48% in 2020. Growth of 56% is expected by 2025. It should be noted that only 9 brands share the market, which represents 75% of sales, with Apple in the lead. [...]
[...] Pedometers can also give the number of steps, calories burned, or distance travelled to fewer than 30 euros. III. Conclusion and Strategic Recommendations The Polar group, therefore, has a very important reputation throughout the world. Specializing in the sports and fitness sector, the group offers products of various kinds, such as connected watches or even bicycle computers or cardio frequency monitors. We have seen in this article that the threat from new entrants can be relatively high for the Polar group. [...]
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