September 15, 2015
Joshua Tarlow
BA 3103-010
T&R, 11:00Am-12:20PM
Big Tobacco’s E-Cigarette Dilemma
Background
Cigarette use in the United States has steadily declined from its peak of 42 percent in 1965 to 18 percent in 2013. Smoking rates for users under the age of 18 are also at record lows, presenting potential problems for tobacco companies in the future. Approximately 90 percent of smokers start before the age of 18, while 99 percent start by the age of 26 . If this trend continues, tobacco companies will continue to experience a decline in the smoking rate. Recently, e-cigarettes have begun to fill this void appealing to a young demographic. More adolescents are now likely to try an e-cigarette than a traditional cigarette. Excluding …show more content…
Alternative Solutions The Tobacco Industry should not invest its resources in promoting new regulations for e-cigarettes. Many public officials and health organizations are beginning to formulate regulations . Most likely new taxes will be levied on e-cigarettes, erasing the cost advantage for e-cigarettes. Sales of e-cigarettes will almost certainly be restricted to anyone over 18 years of age. The medical community will continue to study the long term impact of e-cigarettes . Unfortunately, any scientific evidence from long term studies are still decades away, something that no amount of money can change. Tobacco companies should continue to pursue market share in the e-cigarette market.
The e-cigarette market will continue to grow at the expense of traditional cigarettes. Netflix faced a similar predicament a decade ago and successfully transitioned from a DVD subscription service to a streaming platform. Movies were the product that people were consuming, and the DVD was simply a device that delivered it to their living room. Cigarettes are essentially a device to deliver nicotine to the consumer. There are multiple ways to consume nicotine aside from inhaling smoke. E-cigarettes simply provide an alternative method to delivery nicotine to the consumer. Tobacco companies should adopt a similar …show more content…
While this fear is not unfounded, there have been many companies that have intentionally cannibalized one product for the benefit of the other. Apple famously introduced the iPhone at the zenith of its iPod sales aware of the impact that the iPhone would have on iPod sales. Technology is constantly improving at an increasing rate. Apple knew this and saw that both products were both a medium for consumers to access music. The iPhone included newer technology and increased functionality over the iPod. If Apple had not intentionally cannibalized its own product, another company would have. The dynamic between e-cigarettes and traditional cigarettes is very similar. E-cigarettes off more functionality through customization, including flavor and cartridge options, and are cheaper. Tobacco companies have an excellent opportunity to follow Apple’s example before the competition
Joshua Tarlow
BA 3103-010
T&R, 11:00Am-12:20PM
Big Tobacco’s E-Cigarette Dilemma
Background
Cigarette use in the United States has steadily declined from its peak of 42 percent in 1965 to 18 percent in 2013. Smoking rates for users under the age of 18 are also at record lows, presenting potential problems for tobacco companies in the future. Approximately 90 percent of smokers start before the age of 18, while 99 percent start by the age of 26 . If this trend continues, tobacco companies will continue to experience a decline in the smoking rate. Recently, e-cigarettes have begun to fill this void appealing to a young demographic. More adolescents are now likely to try an e-cigarette than a traditional cigarette. Excluding …show more content…
Alternative Solutions The Tobacco Industry should not invest its resources in promoting new regulations for e-cigarettes. Many public officials and health organizations are beginning to formulate regulations . Most likely new taxes will be levied on e-cigarettes, erasing the cost advantage for e-cigarettes. Sales of e-cigarettes will almost certainly be restricted to anyone over 18 years of age. The medical community will continue to study the long term impact of e-cigarettes . Unfortunately, any scientific evidence from long term studies are still decades away, something that no amount of money can change. Tobacco companies should continue to pursue market share in the e-cigarette market.
The e-cigarette market will continue to grow at the expense of traditional cigarettes. Netflix faced a similar predicament a decade ago and successfully transitioned from a DVD subscription service to a streaming platform. Movies were the product that people were consuming, and the DVD was simply a device that delivered it to their living room. Cigarettes are essentially a device to deliver nicotine to the consumer. There are multiple ways to consume nicotine aside from inhaling smoke. E-cigarettes simply provide an alternative method to delivery nicotine to the consumer. Tobacco companies should adopt a similar …show more content…
While this fear is not unfounded, there have been many companies that have intentionally cannibalized one product for the benefit of the other. Apple famously introduced the iPhone at the zenith of its iPod sales aware of the impact that the iPhone would have on iPod sales. Technology is constantly improving at an increasing rate. Apple knew this and saw that both products were both a medium for consumers to access music. The iPhone included newer technology and increased functionality over the iPod. If Apple had not intentionally cannibalized its own product, another company would have. The dynamic between e-cigarettes and traditional cigarettes is very similar. E-cigarettes off more functionality through customization, including flavor and cartridge options, and are cheaper. Tobacco companies have an excellent opportunity to follow Apple’s example before the competition