Another Heavy-Hitter Enters The Electronic Cigarette Business

by Jenny Spring

Another Heavy-Hitter Enters The Electronic Cigarette Business

When electronic cigarettes first began gaining popularity, the big fear within the industry was presumed opposition from big tobacco companies. The assumption was that since people were switching from analog cigarettes to electronic cigarettes, the tobacco companies would do all they could to put a stop to the rapid loss of their customers. This is precisely what the tobacco companies first attempted to do with a constant barrage of negative information regarding electronic cigarettes, coupled with intense lobbying.

However, big tobacco very quickly realized that this is not a force to be reckoned with. Smokers found it much easier to quit cigarettes with the aid of electronic cigarettes. Countless testimonials from heavy cigarette smokers claimed the same fact: they’ve tried the patch; they’ve tried the gum; they’ve even tried hypnosis, but nothing helped in the same way as electronic cigarettes. Equally important is that people, including non-smokers, simply like vaping. So, rather than fight the force, tobacco companies smartly elected to ride the wave.
This became most apparent when Lorillard, the tobacco company that makes such brands as Newport and Kent, purchased the electronic cigarette company, Blu, for $135 million. This was a shock to smokers and vapers alike, as the consensus up to that point was that the ecig industry and the tobacco industry were rivals. However, the reality that tobacco companies finally realized is that analog cigarettes are in decline, while electronic cigarettes are booming. As such, they chose to cease the opportunity and get involved.

Soon after the Blu acquisition, all eyes were on Altria, the parent company of Marlboro, as they were in reported talks with Njoy Electronic Cigarettes, one of the world’s largest manufacturers of ecigs. For a period of time, negotiations persisted between the two companies, but nothing ultimately materialized. Although the details of the negotiations are largely unknown, the likely scenario is that Altria did not offer a satisfactory amount for the purchase. Over a year has passed since the attempted acquisition of Njoy, with no further reports of any negotiations between the two companies.

Altria, as it turns out, elected to use its power to found a new electronic cigarette compay, Mark Ten under Nu Mark subsidiary. Typical to large corporations, Altria first tested the market with very limited funding and exposure to determine whether or not this was a venture they wished to pursue. They used their wide reach to introduce Mark Ten to liquor stores, convenience stores, and gas stations in select areas. Altria very rapidly realized that this is a profitable endeavor, and announced that they are going to fully roll out the Mark Ten brand, putting the companies full weight behind it.

Around the same time as Altria’s announcement to go national with Mark Ten, Nu Mark announced their acquisition of Green Smoke, another big player in the electronic cigarettes industry, for $110 million. This move gave Altria a huge boost to its customer base, and will likely help propel it to the top of the market quickly—at least much faster than if Altria were to launch Mark Ten from the ground up.

With the constant array of new legislation meant to regulate and restrict electronic cigarettes, Altria is a welcomed new player to the game. It may sound counter-intuitive, but having the lobbying power of large tobacco companies behind the electronic cigarette industry will undoubtedly help tame the relentless attack against it. Vapers come from all walks of life, but one thing they all have in common is that they enjoy vaping and want to be left to do so without being treated in the same fashion as cigarette smokers. Electronic cigarettes are odorless, so it does not offend those around, and there is absolutely no concrete evidence of any harmful effect of them on users or bystanders.

However, since electronic cigarettes are associated with analog cigarettes, the media has largely villainized them. As such, the electronic cigarette industry is in dire need of a voice. Although there are millions of voices out there in support of ecigs, there is one key element that is necessary for those voices to be heard—money, and a lot of it. Only time will tell what the ultimate fate of electronic cigarettes will be, but one thing is for certain—they are here to stay.