A New Technology... Picking Up Another Market's Customers

Yesterday in class we talked about how the increase in the demand of fish was met by an increase in the supply of fish by new technology in the boats that are used to supply those fish. With this in mind I started thinking about how new technologies could be benefited by the falling demand of a similar market.

Take for instance the electronic cigarette. With the tobacco use at a steady decrease it looks as if the tobacco/cigarette companies will be nearly obsolete in the near future. With more than 20 states having a public smoking ban, talk of an open air smoking ban, increasing "sin-taxes", and a decline in the number of smokers the future for cigarette companies looks fairly grim. But on the flipside; a nicotine addicted smoker has a new option. The invention of an electronic cigarette, or e-cig, may permit smokers to enjoy their nicotine buzz in public. The e-cig looks, feels, and tastes like a real cigarette, but doesn't create the hazardous chemicals that real tobacco smoke does. The e-cig creates a nicotine vapor that is emitted into the mouth piece that has no residual smoke. Producers of the e-cig claim that the e-cig will help those who are wanting to quit smoking by the ability to adjust the nicotine output level so they can wean themselves off of nicotine, the addictive agent in real cigarettes. The average price of an e-cig is about $140 plus tax.

Taking into consideration this new invention I ask... Is this invention really aiming to wean smokers away from nicotine? If so, then I predict the market for these e-cigs to eventually suffer heavy losses. Smokers would take to this product because it would allow them to "smoke" in public, and if they decided to quit smoking it would aid in the process. Knowing that nicotine is the addictive agent in cigarettes and providing the nicotine in the e-cig is just another way to get the smokers addicted to a new form of nicotine, which serves as a way to get customers addicted to thier new product and keep the demand for the components of the e-cig fairly steady.

This invention is brilliant because keeping in mind the dying cigarette market this invention has the possibility to absorb some of the customers that are dropping out of the real cigarette market, and possibly steal members of the real cig market. This invention also has the ability to creat new smokers. If the e-cig produces no harmful chemicals as the makers claim then there would be no harm in starting to smoke because there is no risk. Producers of the e-cig state that the only product that is given off is nicotine and
"propylene glycol, which is used in everything from Hollywood smoke machines to food colorings to hydraulic fluids". The fact that it is used in hydraulic fluids doesn't really sound too appealing. They also state "That, e-cig supporters say, allows smokers to wean themselves from nicotine, which most doctors say is highly addictive but not, as far as they know, a carcinogen." The main part that I would like to highlight in this sentance is how they say "as far as they know".

If people believe that this product is a harmless way to feed a nicotine addiction, or to start one for that matter, then why wouldn't they use this product. Aside from how I personally feel about this product it is a brilliant invention because it will pick up a variety of smokers: Quitting smokers, current smokers, and aspiring smokers. Looking at this invention as an economist there are numerous possibilities for profit in this market.

Image provided by: http://www.cdc.gov/tobacco/data_statistics/tables/trends/cig_smoking/

For more info: http://www.mercurynews.com/extra/ci_11873938?nclick_check=1