Michael Porter's Five Challenges Of Eharmony And Its Competitive Advantages

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eHarmony and its Competitive advantages

The most important framework introduced to a business student is Michael Porter’s five forces and it is considered as the most prevalent framework to analyze the structure of an industry. The five forces are:
a. Barrier to Entry
b. Existing industry rivalry
c. Threat of substitutes
d. Bargaining power of suppliers
e. Bargaining power of buyers.

In my opinion, the most important force of this model is Barrier to Entry which if implemented properly can help a business gain the competitive advantage in the industry. The barrier to entry can not only help business to stop new competitors to enter but it also gives the power of monopoly or leadership in the industry. The outcome is an out-sized return on capital for long period of time. Competitive advantage is created either by unique capabilities or unique positioning, however, the better unique positioning serves the purpose in depth by giving businesses demand advantages in the form of customer captivity, supply advantages in the form of patents and unique technologies and most important regulatory advantages. When any industry has the above advantages, it is indeed very
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eHarmony imposed several measures of control. They almost rejected 20% of their membership as they felt are not a good fit for the website. The business made his name in the market by portraying the seriousness and commitment of business to pool the right people for the right ones. This cost them almost $1 million of loss but later proved to be a great competitive advantage. Subscribers became more serious towards the product and showed loyalty and felt a sense of achievement of being a member of eHarmony. This restriction made sense as it also helped to stop artificial competition among the member and helped the subscribers to concentrate on a correct choice of people. This was an indeed a perfect strategy to stand on the company’s true motto and

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