The US electronic-cigarette industry has tripled sales due to the help of TV ads, NASCAR sponsorships, and products giveaways, which has led to a $1.5 billion industry. However, the Food and Drug Administration may threaten this success. The FDA is set to decide whether to lump e-cigarettes in with the conventional $90 billion U.S. tobacco market. This ruling could set up greater restrictions on the product, advertising, flavorings and online sales. Greater restrictions could harm e-cigarette companies because it would diminish the notion that e-cigarettes are a healthy substitute for tobacco product. E-cigarettes could experience to restrictions like banned TV advertisements and severed ties with NASCAR. Another restriction that e-cigarette companies could face is not being able to hand out samples. The potential restrictions e-cigarette companies could face might lead to a decline in its market.
Another problem the industry faces is the alarming number of children getting hooked on nicotine. The Center for Disease Control and Prevention found that the share of U.S students in middle school and high school who use e-cigarettes doubled to 10% in 2012 from 4.7% in 2011. In comparison, regular cigarettes use by adolescents has declined from 8.3% in 2010 from 11.9% in 2004. With the lack of information about the healthiness of e-cigarettes, government officials are trying to gather more information in order to better make decisions on controlling e-cigarettes.
With the growth of society being health conscious, the implications of the FDA could affect e-cigarettes’ advertising and the healthy substitute for tobacco products. It will be interesting to see how FDA rules and how these potential restriction affects the e-cigarette market.
Due to the increase consumer spending during the holiday season, Wal-Mart Stores and Amazon.com are preparing for the expected online spending. In early October, Wal-Mart announced that it is opening two new fulfillment centers, one in Pennsylvania and one in Texas. These new fulfillment centers will help deliver online orders to its customers faster. At the same time, Amazon said it is creating 70,000 full-time seasonal jobs across its fulfillment centers to handle the increased holiday spending. This increase comes after Amazon said it was hiring 5,000 fulfillment workers two months prior.
What does this show? For starters, the similar reactions to the increased online shopping by both Wal-Mart and Amazon proves that American consumers have changed their shopping habits. For example, research firm ComScore studied and determined that online spending during last year’s holiday season jumped 14% to $42.3 billion compared to the same period the prior year. In addition to these responses to the increased holiday spending, both Wal-Mart and Amazon also react to the increased trend of online spending even during non-peak periods. By creating two more fulfillment centers, it appears that Wal-Mart is investing in more fulfillment centers in order to react to the increasing demand of online shopping. Similarly, since its customer demand rose by 40% over the last year, Amazon expects to convert thousands of its seasonal workers into full-time employees.
Last Tuesday, Drug maker Merck announced that it will lay off thousands of employees. Merck plans on cutting 8,500 jobs, which is in addition to the 7,500 job cuts that were previously announced. The company explains that these job cuts are a part of “a global initiative to sharpen its commercial and research and development (R&D) focus.” In addition to these job cuts, Merck also announced that it will move its global headquarters from Whitehouse Station, New Jersey to Kenilworth, New Jersey. Continue reading
Over the past couple years, major technology companies have taken steps towards vertically integrating themselves in an attempt to imitate Apple’s success. In order to manufacture smartphones and television set-top boxes, Google acquired mobile device maker Motorola Mobility. Amazon created the Kindle Fire tablet to bridge hardware and e-commerce. Oracle bought Sun Microsystems in order to create integrated hardware and software devices. Also, Microsoft now makes hardware for its Xbox gaming system. These are recent examples of technology companies trying to emulate Apple. Continue reading