This year, the usage of the word “vapers” isn’t a reference to a hip hop, Biz Markie song, but the slow, melancholic, soliloquy Big Tobacco is currently singing as sales for cigarettes drop, as well as sales for basic e-cigarette disposables and rechargeable cig-a-likes.
We know that users aren’t returning to cigarettes, as Big Tobacco wants users to think. Not so fast, Big Tobacco. We saw in the most recent quarter that cigarette sales didn’t support these claims.
Like cigarette sales, e-cigs are not seeing the growth they once realized. Until the beginning of May, sales for e-cigarettes were growing steadily. Wells Fargo researchers recently highlighted the fact that e-cigs had significant growth at 71%, until they took a dive. So, what’s behind the drop in sales for traditional cigarettes and electronic cigarettes? We think it is vaporizers.
Vaporizers are growing twice as fast as e-cigarettes, claims Wells Fargo, and we agree.
Vaporizers are bought online and at vape shops like VapeRite, not the gas stations, convenience stores and supermarkets where Altria, Reynolds and Lorillard have huge distribution networks. There are about 16,000 vape shops in the U.S., up from 10,000 last autumn, according to the Smoke-Free Alternatives Trade Association, an e-cigarette industry group …
… Tobacco-industry leader Altria Inc., maker of Marlboro cigarettes, and No. 2 tobacco player Reynolds American Inc., which sells Camel smokes, both are launching their own brands of e-cigarettes nationally next month as they try to offset falling sales for traditional cigarettes. Altria, which is readying a national launch of MarkTen said it is “monitoring” vaporizers but declined to say if it would launch a competing product. Reynolds said it remains focused on rolling out its Vuse brand and has no plans to launch a vaporizer.
What Are Vaporizers?
Where have you been? (you’re here on our site and ask this question?! Just kidding, everyone can ask away here, no silly questions – the terminology and state of this market changes so quick anyway it’s hard to not get more than a little confused once in a while).
PVs or Personal Vaporizers are gadgets used to vaporize e-cig liquid containing nicotine, or as increasingly we are seeing in the coming together of essentially identical devices (other than specific details of the atomizer designs) new vapor pens – like the breakthrough V2 PRO Series 3 – can excel while puffing on e-liquid plumes as expected, but do equally well with other ‘mediums’ such as dry herb, wax and oils (with a specially optimized slide in tankomizer cart optimized for each).
There are many varieties including fountain pen looking vaporizers, powered by battery. Vapers, individuals who use vaporizers, can pick and choose what style vaporizer they want, depending on their mood, or the day, for that matter.
Vapors See Value
We think cigalikes and e-cigarettes were a great option to avoid the negative stigma surrounding smoking, initially. Users were relatively satisfied, while smoking, but the costs could be expensive. For instance, Blu, the leading e-cig, offers refillables in a pack of five for $12, yet smokers weren’t completely satisfied with the experience. Converting to vaporizers saved users money and they didn’t have to deal with sideways looks. Now, after the initial purchase, vapers can purchase e-liquid containing nicotine for $10, and they get the equivalent of 40 cigarettes; that’s a great value for users.
Customization Entices Smokers
We understand that it’s not just about the value, though. Vapers enjoy the ability to customize their devices. Vape shops sell a host of gadgets that allow vapers to make their experience truly their own. Customization is only limited to their imagination. Users can purchase hands free attachments, glass domes, and custom mouthpieces. We can’t forget about the ability to smoke customized cocktails of e-cig liquid; that kicks it up a notch.
Bigger Throat Hits Are Alluring
Another contributing factor we’ve found leading to declining sales in cigalikes is their inability to completely satisfy users. Yes, it feels similar to inhaling a real cigarette, but it doesn’t quite hit the spot. But, vaporizers give users that throat hit they’ve longed for since they quit smoking. Even Murray Kessler, Chief Executive of Lorillard Inc, creator of the Blu electronic cigarette, told the Wall Street Journal, that vaporizers “deliver a superior consumer experience at a better value.” Vapers get that good ole feeling of smoking, and they have money to burn.
Vapping is Social Experience
Vaporizers are a part of a social movement, away from cigarettes and cigalikes. Vapers can smoke until their heart is content in vape shops, or use their very own custom-built vaporizer while hanging with friends at home. We recognize that vaporizers offer more than a quality puff, they offer user an experience. Images of vapers in vape shops are all over social media pages. From stars to entertainers and people just like you, many people are using vaporizers with their friends.
Big Tobacco, Jumping on the Bandwagon
After a significant delay, R.J. Reynolds decided to enter the market with their introduction of Vuse. It is small, rechargeable and developed to provide vapers with the optimal puff. R.J. Reynolds told USA Today that Vuse captured two-thirds of the e-cigarette market in Colorado when they tested it on the market. Additionally, Altria introduced their MarkTen e-cig to 60,000 retailers, but is it enough?
Will the No.1 and 2 tobacco industry leaders regain market share lost to vaporizers? R.J. Reynolds is reporting market share gain, but is that due to the impending merger and uncertainty surrounding Blu? We know that only time will tell.