Home Security Market in the U.S.A., Australia Term Paper

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¶ … home security market in the U.S.A., Australia, and Finland

Taking into account the increased need for security expressed by both private and public sectors as a result of the terrorist attacks occurring worldwide, the security industry has evolved significantly for the last decade. This promising reconfiguration of the world's security coordinates has offered new perspectives for manufacturers providing products and services within this domain.

One of the companies which have seized the new opportunities arising on the security market was Sequiam Corporation. This was founded in 1999, by Nick VandenBrekel who successfully combined his military background (based on security aspects, in general, and human security, in particular) with his knowledge concerning biosciences and neuro-physiology. The know-how resulted was exclusively dedicated to biometrics, a concept implying human recognition on the basis of unique biological features (fingerprints, iris, retina etc.). After founding the company in 1999, an impressive research and development process started. This lasted five years and culminated in introducing the "consumer lifestyle biometrics" concept. As Nick VandenBrekel has stated, the syntagm designates low-priced security products, useful and enticing enough in order to make people's life "easier and more secure" (http://www.findbiometrics.com/Pages/feature_sequiam.htm).

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Some of the products that Sequiam boasts are: BioLock / Smart Scan; BioVault - a safe recommended by the National Rifle Association that can be operated on biometric principles, ideal in terms of both protecting jewels, important papers or other valuable things and keeping guns out of the reach of children or strangers; the Universal Biometric Interface (the UBI) - "a device replacing anything you activate with a remote control, pin code, pin pad, regular switch," used at garbage disposals, garage doors and so on (http://www.findbiometrics.com/Pages/feature_sequiam.htm).

Term Paper on Home Security Market in the U.S.A., Australia, Assignment

The new product that Sequiem has recently launched on the American market is a biometric fingerprint door lock which has been designed after a three-year research process which took into account all the significant features of the consumers' behavior. First of all, the product targeting the home security market has considered the difficulties that clients may find in turning from the traditional key systems to the new biometric ones. In order to ensure a smooth transition, the company has made a keyhole in the lock and has provided users with a key backup although it is aware that this will never be used.

Secondly, Sequiem has paid attention to the customers' social needs claiming higher aesthetic standards. Therefore, the biometric door lock was thought to be a safety provider and a refined adornment, at the same time.

Thirdly, when designing and launching the product, the company has focused on credibility to a high extent. Thus, it has decided to work with Black & Decker, the brand having the largest awareness among Americans (surveys emphasized that out of 100 people, 95 had heard of Black & Decker before). Consequently, the company has proved to be an excellent expert in human psychology whose requirements have been complied with in order to ensure a strong adherence on the security market. Moreover, Sequiem has launched the product at a low price (about $199) which made it affordable to the middle class, too. Additionally, the American company has succeeded to build a favorable image of biometrics within the consumers' segment due to Fortune 50 partners which after buying the product have announced their intention to organize marketing campaigns which are tens of millions of dollars' worth (http://www.findbiometrics.com/Pages/feature_sequiam.htm).

2. Evaluating and contrasting the American, Finnish, and Australian markets

In order to decide whether the biometric fingerprint door lock will address only to domestic users or it will also target overseas consumers, a snapshot analysis of the American and foreign markets becomes compulsory. For this case study, the foreign debouches chosen are Finland and Australia.

Finland is a North European country that takes pride in high living standards. Despite the country's economic aura, the security sector remains an insignificant branch of the service sector industry, a thing which is otherwise proved by the poor data that national statistics provide. Still, an optimistic perspective seems to arise as a result of the Statistics Finland's findings. The institution referring to guarding, detective and overall security services as a whole announced a 10% increase in the sales volume, in 2003. Moreover, according to local sources, the private security industry amounted to $510 million, in 2003. This optimistic trend is explained through the Finnish government's decision to reduce the funds of local police. Therefore, people and institutions have replied to the state's security support withdrawal by purchasing various systems that specialized companies offer.

The national market is dominated by a few large corporations which have managed to swallow smaller firms. One of the main giants controlling the security sector is Falck Security that has been operating on the Finnish market since 1922. The largest division of Finland's security sector is the guard services one, amounting to $200 million. This sub-sector is operated by two major corporations: Securitas Oy and Falck Security Oy which hold 95% of it. The second position of the hierarchy belongs to the security and alarm system installation market.

The widest end-user segments are said to be public sectors, large private companies, but also hotels and small firms which have valuable or dangerous assets to protect. In what home security is concerned, Finland doesn't represent a very encouraging business environment as the population's interest in securing households is very low. Yet, a slight increase has been noticed lately because of the insecure climate covering the entire world after September 11, 2001 and other isolated terrorist attacks threatening western countries. Thus, the best products and services which are said to be suitable for the Finnish market's requirements are the advanced guarding services and modern technologies consisting of alarms, close circuit television or access control systems. The IT security market also displays a huge potential as data crimes are becoming increasingly frequent in Finland, too.

In terms of imports, the country offers a favorable climate to international companies which have managed to gain considerable market shares within the framework of certain sub-sectors. The items responsible for this optimistic economic context are the lack of any trade barriers or market impediments and the 22% Value Added Tax which applies to all imported goods. The U.S. have made use of such facilities and brought their security products and services on the Finnish market. The latter has proved to be receptive and has helped American companies build a good reputation (http://www.buyusainfo.net/docs/x_4239321.pdf.).

Australia is another possible debouche for the U.S. security firms. Unlike Finland, Australia is actively involved in fighting against terrorism because of its military and political decisions regarding Iraq and Afghanistan. September 11, 2001, along with the terrorist attacks from Bali and Djakarta and the prompt support offered to U.S.A. And U.K. has determined an increased demand for security products. According to the study that Woolcott Research carried out in 2000, Australians may be considered "security conscious." Still, their preferences seem to favor traditional systems like back-to-base monitored security (encompassing a person who calls and a guard who checks the house), dogs and deadbolts which exist in almost 75% of the Australian homes. When being asked which was the reason that hindered them from buying new security systems, Australians answered that the high prices at which such technologies were being sold made them stick to the old ones (Brown, 2000). Yet, in spite of the fact that only 5% of the Australian homes (in comparison with 18% in U.S.A.) had security alarms, in 2000, the perspective offered by the national security market looks quite optimistic if we consider the $4.5 billion annual revenues and the personnel amounting to 150,000. (http://www.asial.com.au/default.asp?page=%2Fconsumer+information%2Fsecurity+industry+overview)

Forecasts are very positive, too, as the estimated volume of security expenditures for the coming year is said to be $30 billion. 15% of the total amount is due to the private sector. On the other hand, the 5.5% yearly grow rate which has been announced for the next five years represents an additional encouragement for those companies willing to enter the Australian market. (http://www.asial.com.au/default.asp?page=/media%20centre/research+and+articles/environmental+scan+of+the+security+industry)

At present, the backbone of the security sector in Australia is made up of two major areas: the electronic equipment including CCTV, alarms, monitoring, access control, biometrics etc., and manpower comprising concierge, reception desks, securing special events, escorts, ATM servicing, mobile patrols, airport security and so forth. In what biometric technology is concerned, it should be pinpointed that this concept is applied especially to government, health care, didactic and IT sectors (http://www.buyusainfo.net/docs/x_4239321.pdf.).

The Australian market's commuting from traditional to modern systems can be explained by invoking two reasons: the significant technological progress which results in more affordable products and the high level and random nature of crime. In 2003, the Australian Institute of Criminology carried out a research and concluded that the annual cost of crime was $32 billion. The most significant cots were generated by fraud, burglary, drug offences, while the less significant were due to homicide, vehicle theft and shop theft. (http://www.asial.com.au/default.asp?page=/media%20centre/research+and+articles/environmental+scan+of+the+security+industry).

Considering the report Best Export Markets for U.S. Security and Safety Equipment (http://www.buyusainfo.net/docs/x_4239321.pdf.),the most suitable… [END OF PREVIEW] . . . READ MORE

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