Why a 57% Growth in E Cigarettes is Touted as a Win for Big Tobacco
Not many people can deny that E cigarettes are a phenomena. The industry has seen an astounding triple digit growth every year for the last 5 years, which is enough to have the fat cats of big tobacco quaking in their snake skin boots. In recent months a slowdown in growth has had some quarters shouting that finally e cigarettes have ran out of steam.
According to Euromonitor International, the e cigarette industry can only expect a 54% growth next year, compared to its standard fair of around 114%. The Wall Street Journal calls this a ‘rapid decline in sales’ and is labelling e cigarettes to be more of a ‘fad’ than a real threat to big tobacco.
A 54% growth in any industry would be seen as a huge success, so why are the media pouncing on this as some kind of precursor to the end of the e cigarette industry?
The reasons given for the slowdown in sales include: growing dissatisfaction among customers, new state laws and rising safety concerns.
Lets’ look at these points individually:
Growing dissatisfaction among customers
The devices that cause the most customer dissatisfaction are ‘cig-a-like’ e cigarettes. These fell by 21% in the 12 week period ending 30th October 2015.
Cig-a-like e cigarettes are developed and championed by Big Tobacco companies such as Reynolds and Altria. Bonnie Herzog, an analyst with Wells Fargo stated that “Consumers are disenchanted right now with these products.” Reasons being that the current devices fail to deliver nicotine into the bloodstream as quickly as cigarettes and lack the same so-called “throat hit” that cigarettes offer.
It has long been thought by conspiracy theorists that Big Tobacco companies are trying to sabotage the e cigarette industry. Big tobacco makes almost half a trillion in profits each year, so it’s understandable they have a lot to lose when a product appears that threatens their existence.
Various tobacco companies have bought into e cigarettes, and now manufacture their own products. This can be seen as an enlightened way of doing business along the lines of ‘if you can’t beat them, join them’. But, are they deliberately manufacturing an inferior product?
Reynolds and Altria recently finished a campaign in the States that delivered their Vuse and MarkTen E Cigarettes to over 100,000 stores. They offered promotions that offered starter kits for as little as $1. Tellingly Ms Herzog said in her report, “Many e-cigarette users have found them so disappointing, they have returned to cigarettes.”
The Wall Street Journal states:
“Nick Pepper, a 31-year-old waiter in Providence, R.I., had a similar experience with the Blu C-Cigarette brand owned by Imperial Tobacco Group PLC. He had to draw “really, really hard on it to get the vapour out.” He’s back to smoking a half pack of cigarettes a day.”
You can do the math on that one.
New State Laws
There has been much lobbying in the States about the safety of e cigarettes and this has led to the FDA stalling on the classification of e cigs. In Europe there is an ongoing court case that if successful will make it much harder for independent companies to trade in e cigarettes, and limit the range and supply of different flavoured e liquids. Vaping in public places has seen widespread bans in countries around the world, and this is a benefit of e cigarettes that has now been neutralised. Governments, institutions and federal bodies all seem to class e cigarettes as a ‘tobacco product’, even though there are zero tobacco products involved.
The uncertainty around e cigarettes has indeed put many smaller companies off, with most waiting until 2016 when new rulings are announced. Strict regulations on the sales and manufacture of e cigarettes can only play into the hands of Big Tobacco, who can collectively take over the entire industry.
If this happens then consumers may find they are only left with the cig-a-like e cigs they find dissatisfying. This could lead to millions of vapers switching back to cigarettes.
Something we are sure Big Tobacco wouldn't find too disheartening.
Rising Safety Concerns
The one thing the majority of scientists can agree on is that e cigarettes are less harmful than tobacco, with some saying they are 95% less harmful. This is a discussion that isn’t even up for debate, so why are there continual reports in the press about the safety of e cigarettes? No one would claim that e cigarettes are entirely safe, but they are proven to be safer than tobacco. So if a cigarette smoker switches to e cigarettes it can only be a good thing, right?
Recently there was a scandal in the press about the presence of formaldehyde in e liquid. This led to many consumers being frightened for their health, as no one wants to vape formaldehyde. What many of these news stories failed to report is that formaldehyde is found in tobacco cigarettes, and smokers are subjected to it every time they light up. Furthermore, the level of formaldehyde is only exceeded in e cigarettes if heated to ‘extreme’ conditions. Something that is unlikely to happen with ordinary vapers.
It seems the scaremongers would rather we switched back to cigarettes where they know we are 100% at risk as opposed to vaping e cigs where the long term risks are relatively unknown.
The common sense in this debate is that tobacco is proven to kill people. E cigarettes are proven to be less harmful. If a government wants to protect the lives of their citizens they should encourage us to give up smoking tobacco, even if it means switching to something less dangerous.
Unfortunately it is more complicated when there is a trillion dollar industry involved. I’ll leave the summary to one of the commentators on the Wall Street Journal:
“I am unsure about the health risks of e-cigarettes....so let me rather return to cigarettes which I at least have certainty, will kill me. It seems that uncertainty is life threatening.”