Competitive Rivalry
The intensity of competition among the businesses already operating in a market.
Three determinants set it: how many rivals there are, how differentiated the products are, and how much pricing power the sellers hold. Rivalry is typically the strongest determinant of competition in an environment, and the threat rates strong when many rivals sell equivalent products with little pricing power.
Often confused with
- Threat of New Entrants
- Rivalry is about competitors already in the market; threat of new entrants is about how easily more can arrive.
- Threat of Substitutes
- A substitute meets the same need with a different product; a rival meets the same need with the same product.
Taught in
See also
4.4.A.3 · 4.4.B.2