Cirque du Soleil’s Future Challenges and Development

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How do you explain the success of Cirque du Soleil?

The analysis of Cirque du Soleil shows numerous features that have made it succeed in the entertainment industry. The first strength is that Cirque du Soleil employs the blue ocean strategy to penetrate and expand its market share in the entertainment industry. Since Cirque du Soleil had no capital and resources to compete effectively with leading companies, the blue ocean strategy contributed greatly to its success. Evidently, the adoption of the blue ocean strategy provided an opportunity for Cirque du Soleil to explore new markets and dominate them without experiencing stiff competition from leading companies, such as Walter Disney, Nintendo, Fox, and Netflix. The creation of new products and offering them at low costs in the market are features of the blue ocean strategy that empowered Cirque du Soleil to grow and expand into the entertainment industry. Instead of offering a direct competition, Cirque du Soleil decided to offer exclusive shows in creative ways to avoid competition. Additionally, Cirque du Soleil ventured into new arenas, such as museums, nightclubs, restaurants, spas, and hotels. These new arenas boosted the growth and expansion of Cirque du Soleil because it allowed its products to penetrate the market and experience minimal or no competition in new niches.

By employing the blue ocean strategy, Cirque du Soleil managed to venture into new markets, avoid competition, earn profits, and created a strong brand. Operating in the competitive market, the strong brand has become a major strength for Cirque du Soleil. In both local and internal markets, Cirque du Soleil owns a strong brand that is not only attractive to target customers but also competitors who require collaboration in the entertainment industry.

Cirque du Soleil has received many awards from Primetime Emmy Awards, Juno Awards, Drama Desk Awards, Hollywood Walk of Fame, and Canada’s Walk of Fame for exemplifying great contribution to the entertainment industry in Canada, the United States, and across the world. Diverse corporations across the world want collaborations with the company due to its strong brand in the market.

The diversity of performers comprises another strength that has made Cirque du Soleil a global brand in the entertainment industry. With over 4000 employees consisting of 40 nationalities, Cirque du Soleil is able to present culturally rich content and target diverse countries. Moreover, the analysis of revenues shows that Cirque du Soleil earned over $700 million from customers in four continents. Both diversity of employees and customers present Cirque du Soleil as a stable, sustainable, and global company in the entertainment industry. Creativity is a significant strength that has enabled Cirque du Soleil to generate quality products, which meet diverse and unique needs of customers. Cirque du Soleil reinvests 40% of its profits in the production of creative content. Years of experience and developed infrastructure have made Cirque du Soleil perform exemplary in the entertainment industry. With over 35 years in operation, buttressed roots in the real estate, and well-developed huge hangars, Cirque du Soleil presents itself as a competitive brand in local and international markets.

What challenges do you see in the firm’s business model and what needs to be done to ensure future success?

The analysis of Cirque du Soleil shows that it faces numerous challenges in the entertainment industry. The conservative nature of decisions is a weakness that hinders Cirque du Soleil from achieving its growth and expansion into diverse products. The focus on staged performances does not allow the company to explore great opportunities in the competitive market. By fearing to extend the creative platform, Daniel Gauthier limited the performance of Cirque du Soleil to a limited environment and stifled the growth of innovations. Although an extension of products introduces many risks, including reduced quality and loss of control, Cirque du Soleil would gain extra profits by venturing into new niches. As the second weakness, overreliance on decisions of a single person, Guy Laliberte, is risky for the company to choose valid and sustainable strategies. Diversity in the management of a company is necessary for good governance and sustainable management of the company. When compared to other companies, the earnings from the entertainment industry continue to diminish in Cirque du Soleil. Employees earn relatively low salaries from their performance, making Cirque du Soleil experience a high turnover rate.

The analysis of the external environment indicates that Cirque du Soleil faces challenges of changing consumer needs and advancing technology. Changing demographics in the entertainment industry compels Cirque du Soleil to generate new and creative content that matches the target market. Nomadic performances in various cities and towns across the world are not long feasible because they are not only expensive for the company but also create inconvenience among customers. Modern consumers in the entertainment industry require online platforms where they can access and get entertained at the comfort of their locations. In the wake of the Corona pandemic, it is impossible for Cirque du Soleil to continue with staged performances in halls, hotels, restaurants, and picnic sites. Furthermore, the advancement in technology is also another challenge that pushes Cirque du Soleil to undertake online entertainment. Competitors in the industry utilize online platforms in reaching out to their customers in different regions across the world.

As Cirque du Soleil experiences various changes, it should adopt the following recommendations to ensure its success in the competitive markets for sustainable growth.

  • The management should consider having a diverse management team to provide rich and diverse decisions, which are critical and essential in the creation of sustainable strategies for the company.
  • Cirque du Soleil needs to increase pay for its employees to reduce the rate of turnover, improve performance, and reduce the costs of human resource management in hiring and training new performers.
  • Owing to changing consumer needs, Cirque du Soleil ought to ensure that its products are not only accessible but also relevant to the demographic attributes of consumers in target generations and regions.
  • Cirque du Soleil should focus on providing its entertainment through online platforms, such as YouTube, iTunes, Netflix, Google Play, Amazon, and Vudu, to continue reaching its customers in this era of Corona pandemic in the world and remain competitive.

As the firm evolves, what types of competencies are needed to face potential competitive threats?

The increasing competition in the entertainment industry requires Cirque du Soleil to acquire new competencies. The analysis of the entertainment industry shows that it has reached a saturation point where a feasible growth strategy is a competition. Given that Cirque du Soleil employed the blue ocean strategy in creating new products, venturing into new niches, gaining new customers, and capturing novel demand, the same approach is no longer effective due to increased competition in diverse areas. In this view, the company needs to acquire a new approach of the red ocean strategy to overcome the threat of competition. This strategy is advantageous to Cirque du Soleil because it enables it to maintain the already established market share, optimize profits from the current demand, create quality products, and gain a competitive advantage.

Another important competency for Cirque du Soleil is innovation. The increasing competition in the entertainment industry requires Cirque du Soleil to generate innovative products, which meet the diverse needs of customers across the world. Godfrey et al. (2020) recommend companies employ innovations in designing their products to reduce threats of substitutes, increase entry barriers, diminish the degree of competitive rivalry, and enhance the price. Companies that generate quality products gain a competitive advantage in the market, make voluminous sales, and register huge profits.

Cost leadership strategy is also a competency that Cirque du Soleil ought to acquire for it to remain competitive in the entertainment industry. This strategy enables companies to offer products at the lowest prices based on efficient production, economies of scale, and massive experience (Godfrey et al., 2020). With the efficient production processes, large market share, and extensive experience, Cirque du Soleil is able to create cheap products and satisfy the competitive demand in the market. Additionally, the ability to come up with innovative products reduces the production cost and allows Cirque du Soleil to provide competitive prices in the market. Through cost leadership strategy, consumers would be attracted to low prices in the market, making Cirque du Soleil penetrate and expand its market share in the competitive markets.

The competency of human resource management is necessary for Cirque du Soleil to have competitive employees in the entertainment. Given that Cirque du Soleil experiences the challenge of turnover rate in human resource management, it should strive to train and retain competent employees. The loss of competent employees exposes the company to loss of innovations and enhanced competition. Hence, effective human resource management is a critical requirement for Cirque du Soleil to attract and retain competent employees in the company.


Godfrey, P. C., Lauria, E., Bugalia, J., & Narvaez, K. (2020). Strategic risk management: New tools for competitive advantage in an uncertain age. Berrett-Koehler Publishers.

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