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Juul and Today's Market

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Juul and Today's Market

We’re settling down after some commotion around the controversies about Juul, the infamous e-cigarette giant that was in the news for the wrong reasons. To bring you up to speed, here’s everything that’s happened with Juul until now - 

 

  • 2015, Juul Labs enters the Market - started by two Stanford Product Design graduates Adam Bowen and James Monses
  • Juul becomes wildly popular due to its unique and compact product design, aggressive distribution and ease of availability along with the flavored pods - almost every mainstream celebrity is seen with one and it doesn’t take much time before it becomes a phenomenon.
  • In 2018, Juul sold $2 billion worth of product and was worth $15 billion, went on to raise $650 million from various investors.
  • Altria, the Company that owns Marlboro, and largest Cigarette manufacturer in the World, acquires 35% of Juul Labs as Juul overtakes Altria’s own brand of E-Cigarettes in sales
  • Altria draws a lot of negative attention to Juul - regulators started cracking down on Juul’s methods to reaching out to its audience, which unfortunately includes minors.

 

Ever since then, all the stories seen throughout has been regarding the fact how Juul was made easily accessible to minors, kids through its advertising coverage apart from the way Juul’s products are offered in various different flavors, which makes up for a huge part of the appeal for underage smokers/vapers. 

 

Initially, it has been claimed that Juul hired young actors to play a part in their commercials and photos to specifically target minors along with using their message to communicate that Juuls are safer than cigarettes - the FDA sent a warning letter to Juul Labs asking them to discontinue promoting Juul as a safer alternative to cigarettes. The letter has mentioned instances where Juul has particularly stated to underage consumers about how safe Juul’s are compared to cigarettes and how they should introduce their friends to it.

 

Teen Vaping

Being growth hungry as any other Silicon Valley firm would be, Juul pushed a lot of its Marketing Budget into Social Media. It’s been said that because of this approach, Juul was able to influence the most active demographic on Social Media Platforms like Instagram and TikTok, i.e. teenagers. Part of the problem was making it easily accessible at convenience stores and even large format retailers like Walmart - where there were effectively no restrictions in place to avoid minors from purchasing Juul Labs’ products. When a few kids were seen with Juul, the rest of them would be easily influenced as well and thanks to the ‘vaping’ phenomenon and Juul’s portrayal of being a safer alternative, the popularity of Juul Labs’ products skyrocketed.  A research conducted in 2018 concluded that 6% of 15-17 year olds and 8% of 18-21 year olds where using Juul on a regular basis, which is really disturbing. What is also surprising is that number is only 1% for 24-35 year olds. 

 

What’s next for Juul Labs

While Juul Labs’ management has started taking steps to make it less appealing to the teenage audience, they especially should take firm steps to slow down the distribution of their products in places where they’re easily accessible vs. Speciality Vape shops and distributors, where better control measures can be exercised. Now that Juul has already made a name for itself, it can also cut down on heavy promotional activities that it used to engage itself in. 


Since the recent ban in the US was declared - CEO Kevin Burns has stepped down and Juul indeed has discontinued all forms of advertising and promotional activities. The Trump administration initially suggested banning e-cigarettes nationally and later adjusted that statement to focus on black-market products that weren’t developed under more careful conditions. Juul Labs itself is now part of multiple investigations with regards to its Marketing Practices. New York and Michigan have banned sales of flavoured e-cigarettes, and last week, Walmart stopped selling all brands of e-cigarettes on it premises. A solution to youth vaping needs to be addressed as no person who is underage or not already a smoker/vaper should be using a vape product of any kind.  Banning flavours would be like taking a shotgun to the fly sitting on your foot; only a small portion of the problem is resolved while sending countless smokers who switched to vaping back to cigarettes. The solution is to ensure that retailers are held responsible for selling to minors.


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