Why hasn't Big Tobacco swallowed the entire electronic cigarette industry?
Certainly, there could be a couple of points that are playing around inside the minds of Big Tobacco. First of all, a single basic glimpse at the electronic cigarette market throws up a whole gaggle regarding smaller players all looking for a slice from the proverbial pie.
Big Tobacco is better off biding their time waiting for established electronic cigarette companies to rise within the medium time period to long term future and then overcome these products -- they may normally out-muscle and also takeover the competition, instead of eating them whole. Besides, they might not want to get at the wrong side of US anti-trust laws, that can be unpleasant with regards to dealing with oligopolistic conduct that may be deemed as anti-competitive. Several companies (Big Tobacco) buying out their competitors on the board would decidedly come under the purview of "anti-competitive."
Also, this electronic cigarette market still needs consolidation in terms of regulatory framework. The federal government's stance towards electronic cigarettes, knowing from the conduct of FDA and also the FTC so far, still gives certain measure of hope to tobacco companies.
So at this time, their actions so far can be defined as cautious and also defensive, where they attempt to keep up a foothold in the electronic cigarette market by establishing their own subsidiaries and buying a few of the bigger competitors nowadays (Lorillard acquiring blu Cigs), while waiting for more developments.
Given the risky position that they are presently in, they certainly simply cannot afford throw caution on the wind.
Why should people be aware?
Of all the choices to smoking tobacco, electronic cigarettes offer the most assurance. RJ Reynolds has already started its very own line of electronic cigarettes under the Vuse brand.
Rivals Philip Morris, British American Tobacco, Imperial Tobacco and Japan Tobacco are preparing to enter into the market. Nonetheless, as an industry observer, I would argue that their own current foray is certainly late towards the game and the offerings and planned launches to date have not been really desirable.
As the electronic cigarette market is growing rapidly and possibly cannibalize traditional tobacco sales, Big Tobacco seems to be a step behind on every move and is now only playing catch up.
Certainly, there could be a couple of points that are playing around inside the minds of Big Tobacco. First of all, a single basic glimpse at the electronic cigarette market throws up a whole gaggle regarding smaller players all looking for a slice from the proverbial pie.
Big Tobacco is better off biding their time waiting for established electronic cigarette companies to rise within the medium time period to long term future and then overcome these products -- they may normally out-muscle and also takeover the competition, instead of eating them whole. Besides, they might not want to get at the wrong side of US anti-trust laws, that can be unpleasant with regards to dealing with oligopolistic conduct that may be deemed as anti-competitive. Several companies (Big Tobacco) buying out their competitors on the board would decidedly come under the purview of "anti-competitive."
Also, this electronic cigarette market still needs consolidation in terms of regulatory framework. The federal government's stance towards electronic cigarettes, knowing from the conduct of FDA and also the FTC so far, still gives certain measure of hope to tobacco companies.
So at this time, their actions so far can be defined as cautious and also defensive, where they attempt to keep up a foothold in the electronic cigarette market by establishing their own subsidiaries and buying a few of the bigger competitors nowadays (Lorillard acquiring blu Cigs), while waiting for more developments.
Given the risky position that they are presently in, they certainly simply cannot afford throw caution on the wind.
Why should people be aware?
Of all the choices to smoking tobacco, electronic cigarettes offer the most assurance. RJ Reynolds has already started its very own line of electronic cigarettes under the Vuse brand.
Rivals Philip Morris, British American Tobacco, Imperial Tobacco and Japan Tobacco are preparing to enter into the market. Nonetheless, as an industry observer, I would argue that their own current foray is certainly late towards the game and the offerings and planned launches to date have not been really desirable.
As the electronic cigarette market is growing rapidly and possibly cannibalize traditional tobacco sales, Big Tobacco seems to be a step behind on every move and is now only playing catch up.
0 comments:
Post a Comment