The present world has witnessed increased competition, which has initiated pronounced levels of marketing, and consumer-focused approach in business. Consequently, increasing instances of insecurity and theft amplify the need to have effective theft prevention services.
Despite the fact that several service providers provide tracking services, few focus on personal properties such as laptops, phones, or wallets. The Theft Prevention Chip enterprise is an enterprise that provides security services using an application customized in a smartphone. Remarkably, the application customized in a smartphone of individuals raises an alarm when one takes the property away from the device.
The competitive environment of security service providers using the application is less challenging, but it is subject to the determinants posed by Porter’s five forces model. Therefore, the research paper describes the competitive environment of the technology innovation named Theft Prevention Chip, which is customized for Smartphone application.
Overview of a Competitive Environment
A competitive environment represents the environment within which a business operates and the level of competition evident in the subject location. Business outlets, which sell similar or substitute products usually determine the magnitude of competition in a region. As such, an increase in the number of sellers in a region leads to a high competition in the competitive environment.
Consequently, when the outlets selling similar or substitute products are few, the level of competition in the environment is minimal. Blythe (2013) explains that competitive environment depends on the number of competitors present in a given market. Therefore, in the context of a Theft Prevention Chip, the competitors represent those businesses that offer similar or substitute goods or services. The business outlets determine the competitive environment within which the business selling the security chips operate.
Competitive Environment of Theft Prevention Chip Enterprise
Theft prevention service is a business that modern consumers are increasingly demanding. The rising cases of theft, especially of personal properties such as wallets, phones, and laptops, amplify the essence of the service in contemporary societies. Notably, the current marketing environment is not competitive since few companies provide the service.
As such, the implication of the service providers in the marketing environment is minimal because few service providers, which provide theft prevention chips, dictate the competitive environment. By providing theft prevention chips that produce alarms when the property moves away from the customized Smartphone, individuals enjoy enhanced security for their personal properties. While some companies pose as direct competitors for the Theft Prevention Chip business, others are indirect competitors.
The competitive environment associated with service providers that provide theft prevention chips is minimal. While several companies provide tracking services, their services focus on fleet management and single properties. Therefore, the companies secure properties that have their GPS trackers (Orthmann & Hess, 2012). Consequently, mobile companies such as Samsung, Techno, Apple, and Nokia put trackers in their smartphones, which protect them from theft.
In as much as these companies provide theft prevention services for singular properties or fleets, they pose as direct competitors for the Theft Prevention Chip business. Direct competition is evident because some companies offering fleet GPS tracking services have diversified to incorporate security of the personal property. Companies such as LiveViewGps have diversified and currently provide theft prevention services of the personal property using customized chips.
Moreover, companies such as SpyBike and BikeSpike are among the major direct competitors for the Theft Prevention Chip service provider. Although the present services offered by SpyBike and BikeSpike are focused on bikes, there is a tendency that they may diversify in future and provide theft prevention services on other personal belongings.
Pride (2004) asserts that direct competition leads to selection of a product over another offered by competitors in the marketing environment. Therefore, by choosing security services from companies such as LiveViewGps or SpyBike, consumers forego services from the Theft Prevention Chip service provider.
Indirect competition is another type of competition, which is evident in a competitive environment dictated by service providers offering theft prevention services. Unlike the direct competition, indirect competitors compete with the Theft Prevention service provider by offering substitute services to the consumers. In Pride (2003) explanation, indirect competitors offer substitutes over the actual products.
As such, consumers choose the services from indirect competitors and substitute them with those of the Theft Prevention Chip service provider. Some of the indirect competitors for the service provider include companies, which provide credit cards, locks, and customized alarms.
By providing credit cards, indirect competitors minimize the contents of a wallet and cash that one carries. The implication of minimized contents and cash in a wallet leads to decreased instances of theft. Consequently, by offering good locks, which are superior quality, individuals can leave properties such as laptops in their vehicles or areas that have the locks without the worry of theft.
Orthmann and Hess (2012) elaborate that customized alarms, which work on locks or cars, are also some of the services that pose indirect competition for the Theft Prevention Chip enterprise. The indirect competition takes place because potential consumers of the enterprise may opt to have the alarms installed in their cars or locks so that they can reduce instances of theft on their personal belongings.
Determinants of the Competitive Environment
The competitive environment of security service providers is highly dependent on the marketing microenvironment. Porter’s five forces model provides an in-depth elaboration of these determinants. The determinants comprise threat of new entrants, threat of substitute products, as well as bargaining power of buyers and suppliers.
Service providers, which offer security services to clients, need to be aware of the forces and their effect on their operations. For instance, an increase in the number of service providers offering theft prevention chips means that the competitive environment heightens.
According to Elkarmi and AbuShikhah (2012), an increase in the number of service providers is a concept represented by the threat of new entrants. Moreover, the Theft Prevention Chip enterprise needs to understand that the competitive environment is subject to substitutes, which are trendy and dynamic. The concept representing the determinant is the threat of substitutes.
As such, the enterprise needs to be on the lookout for substitutes posed by indirect competitors in the market. It is fundamental to highlight that Porter’s five forces model is essential in understanding the determinants that affect the competitive environment of Theft Prevention Chip enterprises.
The competitive environment is a very important concept that businesses cannot underscore in their operations. In addition, Porter’s five forces model is requisite in understanding the determinants that affect the competitive environment. Businesses need to understand the concept and the model so that they provide products that are in line with the environment.
Theft prevention chips are very important in security, and thus, the introduction of a business selling the chips can lead to high returns if the business utilizes the concept and the model effectively. With a good understanding of the competitive environment concept, the business can outsmart its competitors and increase its consumer base
Blythe, J. (2013). Consumer Behaviour: SAGE Publications. New York: SAGE Publications.
Elkarmi, F., & AbuShikhah, N. (2012). Power System Planning Technologies and Applications: Concepts Solutions, and Management. Hershey: Engineering Science.
Orthmann, C., & Hess, K. (2012). Criminal Investigation. New York: Cengage Learning.
Pride, W. (2004). Marketing. New York: Cengage Learning.