In the early 1980’s the attractiveness of the circus industry seem to be saturated. The industry structure was not stable, being in long-term decline by alternative various type of entertainment, changes of the preference of customers, uprising concerns of animal rights and diminishing clowns in value, which they are the critical elements used by traditional players in the industry. It all brought in decreasing audience and increasing costs by accelerating competition and changing environmental factors. The traditional circus industries also had to compete with numerous competitors through similar performance and non-differentiated performance players in saturation.
The traditional circus business has faced the difficult situation with a steady decreased audience and declining both revenue and profit. The limited to expand this industry is according to the five forces analysis, even though the barrier to entry to circus industry is high because of high capital requirement in performers, equipment, workforce, etc. but, the industry suffering from the alternative form of entertainment such as sports event, home industry, and play station. Also, rivalry among firms is high; they have to compete with other entertainment businesses such as theatre, opera, and Broadway. Moreover, the competition is not a price competition but it is based on attracting customers so with the low products differentiation in typical circus industry – clown, animals, and performance lead to a strong buyer power. Thus, the existing circus industry appeared unattractive
Cirque de Soleil very successfully entered to an unattractive circus industry by reinvent the industry and creates a new market space. In this case, they did not target the existing market such as children, but they target non-customers of the industry; adults and corporate clients who pay for this entertainment experiences. Also, they invest a lot in equipment in order to raise the venues from a typical circus tent to...
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