Tokopedia Porter’s Five Forces Anaysis

Porter’s Five Forces Analysis of the strength of the company through five strengths Tokopedia. First,  Threat of new entrants, to enter competition, newcomers must provide substantial capital, on the other hand, entrants must have a reasonably good business strategy. In terms of company promotion, newcomers must work hard in marketing. So it can be concluded that the threat of new entrants in this era is not too dangerous for the Tokopedia. This can be seen from the high level of  Tokopedia transactions, and the level of promotion that is more significant compared to the newcomer companies.

Second, Bargaining power of suppliers, power suppliers in tokopedia is strong enough, because there’s a lot of interesting product in Tokopedia. Third, Bargaining power of buyers, the bargaining power of buyers is in a high position because it is adjusted to the wants and financial capabilities of the buyers of the company’s products. If the buyer has a large financial capability, then of course the buyer can choose more freely what products he wants. The products offered are very diverse and include all needs from buyers.

Then, Threat of substitutes, in this case, Tokopedia is not too strong or weak because there’s a lot of business or business services can be used as a substitute, example like there’s offline store, boutique, market, mall, etc. The last, Rivalry among existing competitors, the competition between companies engaged in e-commerce is quite weak, rival of Tokopedia is Shopee. Shopee is one of the biggest e-commerce in Indonesia, they use a lot of voucher, cashback, free shipping, and more interesting thing to attract consumers, example like big event in TV, and big brand ambassador. The conclusion is, Tokopedia is still quite in the top position and comparable to its competitors Shopee.

by: Goesniawan Kevin Dananto & Gunawan Wang