With the
2012 U.S. presidential election and Hurricane Sandy dominating the news
headlines, several recent media stories and coverage of electronic cigarettes
indicating their growth toward mainstream consumer acceptance might be lost in the shuffle.
These
stories include items in Forbes.com and Convenience Store Decisions about the
increasing acceptance of electronic cigarettes in the consumer marketplace, and
another about actor Stephen Dorff’s video ad endorsing Blu Cigs as a major way
to avoid traditional cigarettes.
In fact, the
headline of the Forbes.com story used a rather loaded term in the e-cig world
saying that “E-cigs are ready to explode.” Well, those close to the e-cig industry
and others might recall stories from early 2012 about some e-cigs supposedly
dangerously exploding. Those incidents apparently turned out to be more
frivolous than factual as they were due to significant device modifications and
little has been heard on the subject since they occurred.
The fact
that the fledgling e-cig industry survived that early scare regarding possible
product defects now seems like a distant memory. However, it may well be
remembered as an early victory in the larger campaign toward electronic
cigarette popularity.
The Forbes
story focused on White Cloud e-cigs as just one of several of the more
successful brands like V2, Blu, NJoy and Green Smoke. It also explores the
issue of major tobacco companies becoming more involved in electronic
cigarettes.
Some
interesting numbers from the Forbes’ story include that White Cloud enjoys 77
percent annual revenue growth, Blu Cigs brought in $30 million revenue in 2011,
the e-cig industry generates $250-500 million annually compared to the $100
billion overall U.S. tobacco industry, and 2.7 percent of U.S. adults tried an
e-cig in 2010 compared to just 0.6 percent a year earlier.
While Forbes
predicts that e-cigs are about to “explode” from a combination of technology
and marketing, the trade publication Convenience Store Decisions (CSD) makes a
compelling comparison to the energy drink industry.
CSD claims
the e-cig industry currently generates about $300 million in the retail with
the potential to grow to $1 billion within 10 years, while other industry
experts think it could grow even faster.
The Tobacco Vapor
Electronic Cigarette Association says there are currently 1.5 million
e-cigarette users in the U.S. compared to 46 million traditional tobacco users,
with the big difference being that e-cig use is increasing while tobacco-based
cigarettes are decreasing.
The story
also summarizes regulatory issues facing e-cigs noting that while some smokers may
use e-cigs as a way to cut back or quit smoking regular cigarettes, they are
regulated more like traditional cigarettes than as a health care option to quit
smoking. While government regulation and taxation of e-cigs is being discussed
at various levels, it may also stay just talk as long as e-cigs continue remain
low profile when it comes to marketing, advertising and promotion, which have
been mainly online, word of mouth and smaller promotional efforts until
recently.
One higher
profile advertising effort in recent weeks is actor Stephen Dorff’s partnership
with Blu Cigs on their “Rise from the Ashes” video. While other celebrities and
athletes have either more casually endorsed e-cigs or openly enjoyed them
publicly, Dorff’s video for Blu has received more media coverage. Blu was also
purchased by Lorillard Tobacco earlier this year and helped contribute $14
million in third quarter sales.
Dorff, who has
appeared in numerous films and television such as the movies “Blade” and
“Backbeat,” was a smoker for 20 years. In the black and white Blu (get it) video ad seen
online and on age appropriate cable outlets, Dorff says he now uses Blu Cigs as
a “smarter alternative” to cigarettes and that e-cigs will let us “take our
freedom back.” The YouTube clip already
has more than 14,000 views.
So, as we
move on past the elections, hurricanes and toward 2013, electronic cigarette
brands and their customers should have reason to be optimistic. However, since
nothing is certain these days, E Cig Werks will keep you posted and let us know what you think.
