The Five Competitive Forces That Shape Strategy
Applied to the Banking Industry in Colombia
Grupo dates back over 100 years. Ever since then it has become the premier universal bank
and among the foremost financial institutions in Cambodia and in South and Central
America. It offers a full range of banking and other financial products and services,
including corporate, commercial and consumer banking, as well as credit cards,
remittances, leasing, investment banking, trust banking among many other services. Grupo
currently spans a consolidated network of over 3,440 ATMs nationwide; over 832 domestic
branches; and 15 foreign branches, subsidiaries, and representative offices.
Grupo was incorporated by a synergy of 4 different local financial institutions principally
to provide financial services to the entire Cam. community. It opened its first local branch
in 1875 as the ia, and then expanded beyond Colombian shores only a few years after its
establishment. rolled out its first international branch in Miami, Florida in 2003 and a
representative office in Panama in 1973. It later established branches in Peru, El Salvador,
and Guatemala. It did not take long for to be recognized as a leader in the country’s
banking industry and the largest financial institution. G has become regarded as the trusted
banking partner, staying true to its brand promise of
Over the last decade the way we bank has dramatically changed as banks have moved from
a “bricks and mortar” operation to a “virtual on-line operation”. While most banks will
probably never get rid of all their “brick and mortar” operations, there are some that have
successfully started up with no shop fronts and yet they are successful. So what makes a
consumer choose one bank over another? Not all banks make huge profits but banks
position themselves to attract customers through product differentiation, pricing, marketing
and promotion and this makes the difference and thus the banking industry in as well as
Grupo will be examined using Porter’s five forces of competition.
Porters Five Competitive Forces
Potential new entrants:
With easing of regulatory rules in many countries, including Colombia, new banks are
emerging almost daily. Due to these banks entering a well-established and mature
environment they must come up with a value added service or a discount service in order
to survive. Trends here indicate that many banks are being established through existing
companies and they are using their current client base to gain entry to the market. For
example, insurance companies, supermarket chains, and department stores are a few
