Real-world examples of Porter's Five Forces model in 2025

Why real examples of Porter’s Five Forces model matter

Porter’s Five Forces is everywhere in business plans, pitch decks, and MBA assignments. The problem is that most explanations stay abstract. They define the forces, then stop short of showing how the model explains what’s happening in today’s markets.

Working through concrete examples of Porter’s Five Forces model examples forces you to answer sharper questions:

• Why did Netflix shift so aggressively into original content?
• How did Apple’s control over suppliers reshape smartphone margins?
• Why are low-cost airlines constantly under pricing pressure?

Once you see how the forces play out in real markets with real money at stake, the model stops being a diagram and becomes a decision tool.

Tech industry: example of Porter’s Five Forces in smartphones

The global smartphone market is a textbook example of Porter’s Five Forces in action, but with a 2025 twist: slowing unit growth, premium pricing, and heavy ecosystem lock-in.

Competitive rivalry is intense among Apple, Samsung, and Chinese manufacturers like Xiaomi and Oppo. The products look similar on paper, so brands lean on ecosystem, camera quality, and status. Annual launch cycles keep the rivalry hot.

Threat of new entrants is low. Designing a competitive phone, building a brand, securing carrier distribution, and investing in software support requires billions. The cost of failure is brutal. Even brands like LG exited the market after years of losses.

Bargaining power of suppliers is mixed. Commodity components (memory, standard chips) are sourced from multiple vendors, so suppliers have limited power. But for specialized parts—think high-end OLED displays or advanced chip fabrication—power shifts. Apple’s long-term deals and investments in chip design (e.g., its A-series and M-series chips) help it keep more value in-house and reduce supplier leverage.

Bargaining power of buyers (carriers and end consumers) is high in some segments and low in others. In the premium segment, Apple’s brand power allows pricing that would be impossible for a smaller manufacturer. But in mid-range Android phones, buyers can easily switch brands for a better deal, which drags prices down.

Threat of substitutes comes from longer upgrade cycles and secondary markets. As phones get better and more durable, consumers hold onto devices longer or buy refurbished models. That’s a subtle but real example of Porter’s Five Forces model examples influencing revenue forecasts: the “substitute” is not another brand, but time and the used-device ecosystem.

Streaming wars: examples of Porter’s Five Forces model examples in media

The streaming industry might be the best examples of Porter’s Five Forces model examples for explaining how content, pricing, and churn interact.

Competitive rivalry is brutal. Netflix, Disney+, Max, Amazon Prime Video, and newer players fight for the same hours of viewer attention. Content budgets run into tens of billions of dollars per year. As of 2024, Netflix alone reported content obligations in the tens of billions, reflecting how rivalry translates directly into spending and risk.

Threat of new entrants is moderate. Launching a streaming service is technically easier than launching a cable network, but the real barrier is content rights and brand. A small new entrant without exclusive content gets buried on the app grid.

Bargaining power of suppliers (studios, independent producers, sports leagues) has increased. When Netflix and Disney+ both want the same hit series or sports package, content owners can push for higher licensing fees. Sports rights in particular have become a powerful example of suppliers driving up costs for platforms.

Bargaining power of buyers (subscribers) is very high. With month-to-month contracts, customers cancel as soon as they finish a show. That’s why you see aggressive discounts, bundles with mobile plans, and ad-supported tiers. Churn data is now a central metric in streaming strategy.

Threat of substitutes includes not just other streaming services, but social platforms like YouTube and TikTok. Time spent scrolling TikTok is time not spent on Netflix. From a Five Forces perspective, those are substitutes competing for the same scarce resource: attention.

This streaming case is one of the best examples of Porter’s Five Forces model examples for markets where digital products have low marginal cost but high acquisition and retention costs.

Airline industry: classic example of Porter’s Five Forces under pressure

Airlines are a classic example of Porter’s Five Forces model examples where most forces push margins down.

Competitive rivalry is fierce on popular routes. Carriers fight on price, loyalty programs, and schedule frequency. Low-cost carriers (LCCs) like Southwest or Ryanair (in Europe) keep pressure on legacy airlines by stripping down service and undercutting fares.

Threat of new entrants is low to moderate. Regulatory approvals, airport slots, aircraft financing, and safety compliance create serious barriers. Still, new low-cost carriers occasionally appear, especially in underserved regional markets.

Bargaining power of suppliers is high. Aircraft manufacturers (Boeing, Airbus) and engine suppliers are a small group. Jet fuel markets can be volatile. When a supplier segment is concentrated and switching costs are high, airlines have limited leverage.

Bargaining power of buyers is high, especially on price-sensitive routes. Travelers compare fares instantly via online aggregators. Corporate contracts give large organizations even more leverage.

Threat of substitutes varies by route. High-speed rail in regions like Europe or parts of Asia can be a strong substitute for short-haul flights. Video conferencing became a powerful substitute for business travel during the pandemic and still influences demand patterns today.

For a business plan in transportation or logistics, this airline example of Porter’s Five Forces helps you think carefully about supplier concentration and buyer price sensitivity.

Fast food and QSR: examples include McDonald’s, Wendy’s, and local chains

Fast food (quick-service restaurants, or QSR) offers clear, everyday examples of Porter’s Five Forces model examples that almost any reader can relate to.

Competitive rivalry is visible on every highway sign. McDonald’s, Burger King, Wendy’s, Taco Bell, and local chains compete on price, convenience, and menu innovation. Limited-time offers and value menus are symptoms of intense rivalry.

Threat of new entrants is mixed. Starting a single independent restaurant is relatively easy. Building a large chain with brand recognition, supply chain efficiency, and consistent quality is much harder. Franchising models lower the capital barrier but raise brand and operational complexity.

Bargaining power of suppliers tends to be moderate. Big chains negotiate favorable terms for ingredients and packaging thanks to scale. Smaller operators have less leverage and are more exposed to swings in commodity prices (meat, wheat, cooking oil).

Bargaining power of buyers is significant because switching costs are low. If one chain raises prices or reduces portion sizes, customers can walk across the street. That’s why menu pricing is so sensitive and why chains test price changes carefully.

Threat of substitutes is everywhere: meal kits, grocery store prepared foods, casual dining, food delivery apps, and even home cooking. In 2024–2025, apps like DoorDash and Uber Eats blur the line between fast food and other formats, giving consumers more alternatives at similar price points.

This segment gives accessible, real examples of Porter’s Five Forces model examples that work well in teaching and in investor decks for food startups.

SaaS and B2B software: best examples for recurring revenue models

Software-as-a-service (SaaS) is one of the best examples of Porter’s Five Forces model examples for modern, subscription-based businesses.

Take a B2B collaboration platform or CRM provider.

Competitive rivalry is intense in crowded categories. Dozens of tools offer task management, messaging, or sales tracking. Vendors compete on integrations, user experience, and pricing tiers.

Threat of new entrants is higher than in hardware-heavy industries because cloud infrastructure lowers startup costs. But gaining trust, compliance certifications, and enterprise sales capabilities still takes time and capital.

Bargaining power of suppliers (cloud providers like AWS, Azure, Google Cloud) is moderate. They are concentrated, but competition among them keeps pricing somewhat in check. Open-source components reduce dependence on any single vendor.

Bargaining power of buyers depends on segment. Enterprise buyers with large contracts can demand discounts, custom features, or favorable terms. Small business customers have less individual power, but collectively they can churn quickly if pricing or product fit slips.

Threat of substitutes is often underestimated. Substitutes include spreadsheets, email, or other generic tools that “sort of” do the job. In some categories, AI-native tools emerging in 2024–2025 are substitutes for older SaaS products, changing how value is delivered.

If you’re writing a business plan for a SaaS startup, this example of Porter’s Five Forces helps you think beyond competitors and consider platform risk, switching costs, and the role of substitutes like AI automation.

Healthcare and pharmaceuticals: regulated examples of Porter’s Five Forces

Healthcare and pharmaceuticals are regulated markets where Five Forces still apply, but with policy and ethics layered on top.

Competitive rivalry in pharmaceuticals varies by drug category. For patented drugs, rivalry is limited until generics enter. Once generics arrive, prices tend to fall sharply as multiple manufacturers compete.

Threat of new entrants is low for traditional drug development. Clinical trials, regulatory approvals, and research costs create major barriers. Public sources like the U.S. National Institutes of Health (NIH) highlight how long and expensive drug development can be (NIH overview).

Bargaining power of suppliers (specialized chemical producers, biotech firms, research organizations) can be high for complex inputs or proprietary technologies.

Bargaining power of buyers is complex. In the U.S., large payers—government programs, insurers, hospital systems—negotiate prices and formularies. Policy changes can dramatically shift buyer power over time.

Threat of substitutes includes alternative treatments, generics, and sometimes lifestyle changes or non-pharmaceutical interventions. For example, public health guidance from organizations like the Centers for Disease Control and Prevention (CDC) can encourage prevention strategies that reduce demand for certain treatments.

Healthcare is a strong example of Porter’s Five Forces model examples when you need to show how regulation, patents, and public policy interact with market power.

Electric vehicles (EVs): modern example of Porter’s Five Forces in transition

The EV market provides timely, evolving examples of Porter’s Five Forces model examples as it moves from early adoption to mainstream.

Competitive rivalry is ramping up. Tesla, legacy automakers (GM, Ford, Volkswagen), and newer entrants from China and elsewhere compete on range, price, software, and charging networks.

Threat of new entrants remains limited due to high capital requirements, safety standards, and the need for extensive supply chains. That said, the shift from internal combustion engines to EVs has opened a window for new brands that might have struggled in the old paradigm.

Bargaining power of suppliers is significant in batteries and critical minerals. Concentration of mining and processing for materials like lithium and cobalt gives certain suppliers leverage. Automakers are responding by investing directly in battery production and long-term contracts.

Bargaining power of buyers is increasing as more EV models hit the market and incentives evolve. Consumers can compare features, range, and price across a growing set of options.

Threat of substitutes includes hybrid vehicles, improved fuel efficiency in traditional cars, and in some markets, better public transportation. Policy incentives and emissions regulations further shape how powerful these substitutes are.

For investors and planners, this EV example of Porter’s Five Forces shows how technology shifts can temporarily weaken incumbents and create openings, even in capital-intensive industries.

How to use these examples of Porter’s Five Forces model examples in your own work

Seeing real examples of Porter’s Five Forces model examples is only useful if you can adapt the logic to your own situation. A practical way to do that is to:

• Pick one industry above that feels closest to yours in terms of capital intensity, regulation, and pace of innovation.
• Map the five forces for that industry, using the examples include here as a template.
• Then, rewrite each force for your own business: who are your suppliers, your buyers, your substitutes?

If you’re writing a business plan or competitive analysis, use at least one example of Porter’s Five Forces from a well-known company as a reference point. Investors and executives understand those stories quickly, which makes it easier for them to understand your risk profile and strategy.

For deeper academic or strategic reading on industry structure and competition, university resources such as Harvard Business School’s online materials (Harvard Business School) offer additional context on how the model has been applied and critiqued over time.

FAQ: examples of Porter’s Five Forces model

Q1. What are some simple, everyday examples of Porter’s Five Forces model?
Fast food chains competing on price and convenience, airlines fighting over popular routes, and streaming services battling for your monthly subscription are all straightforward examples. In each case, you can see rivalry, buyer power, and substitutes in your daily choices.

Q2. Can you give an example of Porter’s Five Forces for a small local business?
Take a local coffee shop. Rivalry comes from other cafes and chains nearby. New entrants are any new cafes opening in the area. Suppliers include coffee roasters and equipment providers. Buyers are local customers who can easily walk to a different shop. Substitutes include making coffee at home or buying ready-to-drink options at grocery stores.

Q3. Are digital platforms and AI tools good examples of Porter’s Five Forces model?
Yes. Digital platforms like collaboration tools or AI writing assistants face rivalry from similar apps, new entrants with innovative features, supplier power from cloud providers and model developers, buyer power from enterprises demanding discounts, and substitutes such as legacy tools or in-house solutions.

Q4. How often should I update my Five Forces analysis?
In fast-moving sectors like tech, media, and EVs, revisiting the analysis at least annually makes sense, and more often if there are major regulatory or technological shifts. In slower-moving, capital-heavy industries, every couple of years may be enough, unless a major event changes supplier or buyer power.

Q5. Where can I find data to support my own examples of Porter’s Five Forces model?
Use a mix of company filings, industry reports, and public research. Government and academic sites such as the U.S. Bureau of Labor Statistics (BLS.gov), the NIH (nih.gov), and leading universities (for example, harvard.edu) often publish industry and economic data that can back up your assumptions.