Morgan Stanley Analyst Down On Current E-Cigs
According to an article from Business Insider, Morgan Stanley analyst David Adelman says electronic cigarettes have only captured about 1% of U.S. cigarette industry volume. Adelman says that this is because e-cigs don’t yet satisfy smokers’ expectations.
Adelman claims that e-cigs now have nearly universal awareness and that there is trial among about 50% of smokers. This is massive for a product that was otherwise completely unknown as of just a few years ago.
And yet, according to Adelman, the relatively small market share of e-cigs suggests a high rate of trial and rejection. This is not all too surprising right now. Those smokers that do try e-cigs (from what we’ve seen) tend to try the cheapest and most disposable versions, which largely fail to provide the kind of experience necessary to make a transition happen. The article doesn’t get into what particular shortcomings might keep a transition from happening beyond the issue of battery life.
Adelman seems a little more timid about the future of electronic cigarettes than do some other analysts. Bonnie Herzog of Wells Fargo has repeatedly said that the electronic cigarette industry could well surpass the conventional cigarette industry inside the next 10 years. Only time will tell which is correct.