From eCigs to iCigs

Electronic cigarette manufacturers should take a page out of Apple’s playbook when it comes to design and engineering if they want to truly stand out in the market.

“Devices need to get more ‘Apple-ish,’” said one of the retailers surveyed for a Wells Fargo Security’s Tobacco Talk survey last summer. “A good-looking, sleek, smaller device will drive more growth, period.”

Imagine a vape supplier applying Apple-level craftsmanship and user-friendliness to their e-cigarette or vapor-tank-mod (VTM) systems. Coolness factor aside, that would be one hell of a product.

According to Wells Fargo Senior Analyst Bonnie Herzog, while overall Wells Fargo remains bullish on the broad vapor category — expecting sales to surpass those of combustible cigarettes by 2025 — category growth has moderated, and an improvement in technology is needed for category growth to accelerate.

A $2.5 Billion Market
Wells Fargo estimates Vapor consumption (e-cigs and VTMs) at $2.5 billion in 2014, which includes $850 million in sales among Nielsen-tracked retailers plus the remainder coming from vape shops and online sales, which Nielsen doesn’t measure. In fact, these vape shops are becoming increasingly popular among users, particularly users of VTMs, because of their robust assortment of flavors and products, staff knowledge of the products, and expertise in the category. Plus, they take a consultative approach to selling, which is particularly helpful when it comes to VTMs, as they require a bit of education in their use and maintenance.

This has no doubt contributed to the fact that VTM category is growing three times faster than e-cigs, according to Wells Fargo, though the traditional e-cigarette companies are starting to step up their game when it comes to tech (think Logic Pro, Blu Plus, and VUSE’s new digital technology). Those retailers surveyed attributed this VTM growth to better performance, more affordability, and an “attractive Vaping lifestyle factor.”

Vaping’s Gadget Culture
This last point is an important one. When it comes VTMs, there is an entire subculture developing among users. I don’t have to go any further than ECRM’s HQ office to see this culture play out. We have more than a half-dozen users at our Solon office (I’m also a user, from my home office in NY). They are proud of their VTM systems, compare one against the other, meticulously maintain them, and are always looking for newer/better/cooler components to incorporate into their systems. They view their VTM systems as they view their other electronic gadgets such as their smartphones, tablets, fitbits, and smartwatches. It’s not uncommon for VTM users to have each one of these devices. They are gadget-people.

And just like with consumer electronics, users will gravitate toward those retailers who are knowledgeable about these products, who have the latest and greatest devices, and who take the time to discuss them in the store. Think Apple Genius Bar for vapes.

Unfortunately, most retailers of fast-moving consumer goods have a tough time doing this. They either don’t have the space to dedicate to a broad product selection (it’s dominated by combustible cigarettes, and the major tobacco companies contract for this space), or they don’t have the time and resources to dedicate to the category.

But if you want to sell to members of this growing high-tech vape culture, you have to start acting like a seller of high-tech gadgets, and provide a variety of products, dedicated resources, and education — both in-store and out via online and social media in particular.

And suppliers of e-cigarette and VTM products should seek to continually upgrade their tech, incorporating new features and enhanced usability to their systems. Just like Apple did. The iPhone 3 and iPhone 6 are light-years apart, and the 7 is set to raise the bar even higher .

In other words, like Apple, retailers and suppliers of vaping products must always strive to “Think Different.”

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