E-Cigs: Cottage Industry To Big Business

Snowdon reported the Lorillard purchase of US e-cig company Blu Ecigs last month, noting quite rightly that this could be a boon for the industry.

The Lorillard buy-out is good news, especially if they pump serious money into developing better products. I've said before that e-cigarettes can replicate the sensation of smoking very well but there's room for improvement when it comes to taste (at least to these lips, many thousands of people disagree). I fully expect e-cigarettes to come on leaps and bounds in the next few years unless they are suppressed by the prohibitionists.

There have, however, been fears expressed by some vapers that there is something sinister going on.

I own a fairly successful business myself, and have always thought these fears not only far-fetched, but also rather naïve, considering some of those expressing them have been loudly trumpeting e-cigs as 'the future' for quite a while now.

As Lorillard CEO Murray Kessler expresses in this fascinating and highly recommended Ecig Advanced video, why would a major listed company not want to be on board with such a hugely promising product? Or indeed, 'the future'?

His promise of placing Blu Ecigs in every retailer in the US is not so bold when coupled with the fact that, as highlighted by the ever-vigilant SteveVape, their potential has been noted by investment heavyweights UBS and Wells Fargo.

In their investor report [pdf], UBS are particularly upbeat about the massive continuing increase in sales.

(1) Since being introduced to the US from China in 2007, the e-cig category has been growing in triple-digit territory, reaching an estimated $250 mm during 2011 and is expected to double to $500 mm by the end of 2012. Looking ahead the Tobacco Vapor Electronic Cigarette Association expects the category to quadruple by mid 2014.

Or, if you'd prefer something more readily digestable ...


So mahoosive are the amounts of cash being discussed that it eclipses even tobacco industry sales of alternatives such as chew, snus and dissolvables. And growing at an alarming (for grinchy smoke-haters) or exciting (for vapers) rate, depending on your point of view. The sales growth is certainly not restricted to the US either, it's a western phenomenon which has even reached Peterborough!

Now, if anyone truly believes that Lorillard would buyout a fraction of that market for $135m in a futile attempt to close the industry down, David Icke probably has a spare turquoise shell suit they could borrow.

No. As I've said many times before, the popularity of e-cigs, and the loyal support they engender, has attracted extremely big players to the market. So much so that e-cigs are becoming a nicotine juggernaut which it would be irresponsible to halt, if not impossible.

Of course, even in a scenario where harm is reduced and happiness is distributed more widely, there will still be losers.

Fortunately, they will mostly come from the ranks of hysterical tobacco industry-hating dinosaurs who still live their lives in the 60s and 70s. The types who produce desperate press releases in a pathetic bid to stay in control of a world which has moved on from their obsessive prejudice; the types who would rather see hundreds of thousands die rather than allow tobacco companies to profit from harm reduction and also insist on e-cig bans; and the plainly mad.

There's also this guy.


In the current climate of inexorable e-cig growth, that tweet - which I'll admit to taking great delight in publishing on a regular basis - could become legendary.

Additionally, now that tobacco companies are increasingly moving into the business - which can arguably only enhance its profile and appeal - one wonders where that leaves passionate e-cig afficionados like the Electronic Cigarette Industry Trade Association (ECITA). In March, their representative thought it a clever move to pitch e-cigs to EU Commissioner John Dalli - who is already more than sceptical about recreational nicotine - by describing the tobacco industry as "Big Death", with some of those very same companies soon to be big hitters for e-cig promotion in attendance.

Perhaps the biggest argument yet for involvement from more professional advocates, I'd say.

All things considered, it's an interesting time for vapers. Big business weighing in with hefty financial investment looks set to transform a little-known niche product into something far more visible and part of everyday life than it is now. From cottage industry status, the electronic cigarette could be on the verge of breaking into the big time.