ACQUISTIONS: THE WAY FORWARD IN THE ELECTRONIC CIGARETTE INDUSTRY?

ACQUISTIONS: THE WAY FORWARD IN THE ELECTRONIC CIGARETTE INDUSTRY?

Acquisition has been identified as the key market entry strategy for tobacco giant, as per the latest report by BIS Research on global electronic cigarette market (2014-2024). Similarly, the study identifies new product launch as the key go-to-market strategy for small companies. There are strong indications of tobacco corporations taking over these independent companies in what could be seen as an effort to consolidate the cigarette and e-cigarette market.

These acquisitions and mergers provide excellent impetus for supplementary growth, leverage, and co-operations. There is an immense incentive for the existing e-cigarette companies to get validated, develop brand and market share, and attract the interest of the big tobacco companies for a buy-out as has happened in the case of Blu eCig, E-Lites, and Green Smoke. There has been a frantic search for alternatives to tobacco in recent years, primarily due to the public awareness of the health risks associated with smoking. Moreover, with the declining social acceptability of smoking, the future of tobacco companies rests on their propensity to successfully introduce smokeless products, penetrate new markets and amplify their brand portfolio internally or through acquisitions. Tobacco industry would aim to acquire independent e-cigarette companies within a few years, in order to possess both the traditional and alterative ends of the market- cigarettes and e-cigarettes.

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