Total Nicotine Conference Offers New Vaping Industry Insights
Yesterday saw the conclusion of the Total Nicotine Conference in Sofitel, PA. The conference was organized by CSPnet and covered the vaping industry by providing “current analysis, as well as access to industry expertise with ideas on what to expect in the future.”
While full reports or videos of the conference are not available yet, there were two articles of note published Wednesday that are worth sharing:
The first, entitled Five Insights From Vape Shops, contained a survey of 100 vape shop owners conducted by Management Science Associates. Senior Vice President Don Burke hailed it a “pioneering survey, the first of its kind.” Indeed, not much research has been done about the vaping industry (because it is so young), so this kind of research is a rare treat.
I’d encourage you to check out the whole report, but what I found most compelling was number four, which states, “flavors are important…except for tobacco.” According to the survey, only one third of shop owners surveyed said that tobacco and menthol flavors were “very important” to their business. Burke commented that consumers “may start out with tobacco or menthol flavors, but once they move to fruit or dessert flavors, they don’t go back.”
These findings are especially interesting when you consider what is going on in the world of vaping regulation. It has become clear that the FDA may try to limit flavor availability if/when they decide to implement their “deeming rules.” However, research such as this that shows consumers have more success switching to vaping when they have access to a variety of flavors. This may make the FDA think twice about the negative effects their regulations could cause.
A second article of note summarized the State of the Union on Vape by RBC Capital Markets‘ tobacco analyst Nic Modi. While there has been a lot of optimism in the news surrounding the future of vaping, Modi’s message was one that he called “realistic.” He said that “the category (vaping) is going to be disruptive…It’s just not going to be disruptive in 2015.”
Modi cited information showing that, in convenience stores, vaping devices are losing ground to traditional cigarettes. In regards to the findings he said, “Look at the numbers. There’s a reason cigarette sales are going up. A year ago, retailers were taking on alternatives at the expense of cigarettes. That trend is being reversed.”
For those worried about these developments, there is a silver lining: Modi is specifically talking about convenience store trends. He thinks that vape-specific stores could be picking up the slack in terms of consumer sales. Unfortunately though, vape shop sales aren’t publicly tracked so there’s no way to know for certain.
Modi also mentions that the unsure regulatory environment being promoted by the FDA has caused a slow-down in vaping industry growth. But he believes an even bigger issue is that (in his mind) the technology just isn’t there yet for widespread adoption. He said, “If you really go to a core pack-a-day smoker, they’re just not getting the efficacy from current e-cigs…There’s nothing wrong with the vape category. It just needs to evolve.”
Of course, this critique ties back to the FDA regulations as well. If they implement large regulatory roadblocks it will severely impede the chances of new companies developing innovative products.
He concluded that the reward for designing a revolutionary vaping product exists thanks to consumer demand, but that the question is, “will regulations allow it to come to market?”
Something to think about:
Do you think the FDA will listen to consumers and allow for continued innovation in the vaping industry?