Answer the following 6 questions, given the articles.

Alternative Solutions In order to limit the impact of e-cigarettes on the sales of tobacco cigarettes, tobacco companies can lobby for additional regulation of this new product category. Increased regulation will help to "level the playing eld\" and reduce the advantages enjoyed by e-cigs as a consequence of their largely unrestricted marketing. Among the areas for increased regulation of e-cigarettes, the tobacco companies can lob by federal, state, and local governments to ban television and radio broadcasting of e-cig advertising, prohibit online sales ofthis product category, and proscri be e-cig use in public places. These changes will reduce some of the advantages of e-cigs over tobacco products, thereby presumably slowing the market acceptance of this product category. The tobacco oom panies can also lobby the federal government to regulate e-cigarettes as an over-the- counter pharmaceutical. The Food and Drug Administration {FDA} would then regulate product approvals and monitor the distribution of e-cigs across the United States. Compliance, in the form of application submissions, clinical testing, and pre-market approvals, will be costly for applicants. This will likely limit the number of new entrants in this market, and will therefore help to reduce the intensity of market competition. In order to further blunt the effect of new entrants in the marketplace, tobacco companies can acquire any promising e-cig brands in order to manage the marketing communications and distribution of these products or perhaps to simply discontinue these lines. Lorillard acquired Blue ggi'gsand is seeking to grow this product without cannibalizing the sales of its tobacco cigarettes. Similarly, Altria and Reynolds American could acquire existing product lines in order to manage competition in the tobacco industry. Recommendations The best solution for dealing with the threat posed by e-cigs is to seek new legislation to regulate this growing product category. By lobbying for new product clinical trials and pre-market approvals, the tobacco 2 companies will raise the cost of entry for new competitors. Similarly, bans on broadcast advertising and online sales will reduce the advantages currently enjoyed by e-cig marketers over tobacco ma rketers. The advantage of these solutions to the tobacco companies stem from their substantial existing capabilities for lobbying federal, state, and local governments. The tobacco companies would only need to shift their lobbying emphasis from their tobacco products to the new e-cigarettes. Program Performance Metrics An intermediate metric to determine the effectiveness of any new regulatory legislation is the number of new entrants in the e-cigarette product category. If the newly erected entry barriers reduce the number of entrants, this would provide an early indication of success. Also on an intermediate basis, it will be possible to determine the success of newly implemented marketing regulation of e-cigs by tracking current and potential Program Performance Metrics An interm ediate metric to determine the effectiveness of any new regulatory legislation is the number of new entrants in the e-cigarette product category. If the newly erected entry barriers reduce the number of entrants, this would provide an early indication of success. Also on an intermediate basis, it will be possible to determine the success of newly implemented marketing regulation of e-cigs by tracking current and potential customers' awareness of e-cigarette brands prior to and following the enactment of such regulations. There should be a statistically signicant decline in awareness levels following the enforcement of regulations. A conclusive metric of the success of tobacco companies\" lobbying programs is the goodwill premium associated with the market capitalization of e-cigarette companies. If the entry barriers and marketing regulations are successful. the goodwill premium of these rms should decline. The resulting higher cost of capital will presumably reduce their ability to compete in the market and thereby to take market share from the tobacco companies. \"hat I Have Learned from This Critical Analysis Exercise The e-cigarette product category is a disruptive innovation because of its potential to reduce demand for tobacco products. There are clear indications that tobacco companies are taking the necessary steps to defend their very lucrative market, but these efforts are still at an early stage. We can expect further efforts by the tobacco companies to protect their positions, perhaps by lobbying more intensively for the regulation of e- cigarettes. [The Macro Environment Analysis "What every strategic manager should know!" Discovering Strategy The three types 01 Strategic Environmental Analysis Analysis r' . + _, '- .-T-.. {Industry} (Internal) _,_.____E a """ 3" _,______~ f/' . H' n.\" \\ \\\\\\ I" I \""H.\\ [1/ Strategic \\_ 3/ Strategic \\ \\ Review / You am new K Decision /' \"RE-' ___)'/I \\'M -.__'_ {3'1/ ,./"_____h"\"'~\\ Strategic \\\\melemenlation _." a. ,.-"l ~~._ _,_F The Macro Environment Analysis is traditionally the rst step of a strategic analysis; it is sometimes referred to as an external analysis, a pest analysis or a pestle analysis. The purpose of the Macro Environment Analysis is to identify possible opportunities and threats to your industry as a whole that are outside the control of your industry. (Note: You will often he forecasting trends like \"interest rates will remain static" which may or may not be the case) When completing a macro environment analyses you will be seeking to answer the questions \"what will affect the growth of our industry as a whole" and \"What is the likely impact of al] of the things that affect the growth of your industry\