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How the Vaping Industry Rose From Nothing to Disrupt Big Tobacco

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Vaping Industry Disrupt Big Tobacco

In just one short decade, the vaping industry has emerged from nothing, created thousands of new jobs across the world and made one of the world’s most powerful and most deeply established industries – the Big Tobacco industry – stand up, take notice and fight back to reclaim lost market share.

The story of the vaping industry is an incredible one, and it’s made even more amazing by the fact that e-cigarettes may actually have the potential to reduce the harm caused by smoking. How we got to this point, though, is a most improbable story, and it’s full of lessons for anyone who wants to jump into an established industry and disrupt an entrenched leader.

Find and Solve a Problem

No matter how mature an industry may be, there are always problems – and there’s always room for an upstart to appear with a solution. The problem with the tobacco industry has always been obvious; its flagship product kills the user. Tobacco companies, therefore, must constantly focus their efforts on acquiring new users if they want to survive.

When they first appeared in the late 2000s, it was obvious that e-cigarettes had solved that problem. Since they didn’t generate smoke, it seemed highly likely that e-cigarettes were safer than combustible cigarettes – and scientific research has largely confirmed that assumption.

Even better, the earliest e-cigarettes didn’t deliver nicotine nearly as efficiently as tobacco cigarettes. While that made switching to vaping difficult for some, it also meant that those who switched to vaping greatly reduced their addiction to nicotine.

Release the Right Product at the Right Time

E-cigarettes rapidly gained traction after appearing on the market, and that didn’t only happen because they delivered nicotine without smoke. It also happened because they appeared at the perfect time – in the midst of a major recession.

Many smokers are hopelessly addicted to cigarettes and find quitting virtually impossible. Governments take advantage of that fact by using tobacco sales as a source of tax revenue. Since most smokers can’t quit, they’ll pay whatever cigarettes cost. Nonsmokers, meanwhile, don’t fight tobacco tax hikes because the taxes don’t affect them.

When e-cigarettes appeared on the American market, people had less money available than ever due to the recession, and e-cigarettes presented a far more affordable alternative to coping with constant tobacco tax hikes. The lure of saving thousands of dollars per year helped e-cigarettes gain market share rapidly. Had the e-cigarette appeared in a time of higher wages and lower taxes, it might not have been so successful.

Online vape shop Triple 7 Vaping owner Jason Cugle says, “I never get tired of seeing a new customer’s eyes light up when he realizes how much money he’ll save just by switching to vaping. For some people, the savings are almost like eliminating a car payment.”

Create a Unique Value Proposition

Another reason why the vaping industry became so large in such a short amount of time is because the e-cigarette had a unique value proposition that wasn’t just a low price. The value proposition was the fact that vaping was truly a better experience than smoking. While many smokers love the flavor of high-quality tobacco, that isn’t what companies put into cigarettes. Cigarettes essentially contain the reconstituted powder of whole tobacco leaves. The best stuff gets saved for cigars and pipe tobacco.

How is vaping better than the cigarette smoking experience? It’s better because it can taste like absolutely anything. Companies flavor their vape juices to taste like popular candies, breakfast cereals, frozen soft drinks and more. A cigarette, meanwhile, can only ever taste like a cigarette – and most cigarette smokers don’t truly like the taste of cigarettes. As soon as you show a smoker that he can get his nicotine and inhale something that tastes like blue raspberry rather than cheap tobacco, you’ve made a sale – and you can find parallels to that in just about any industry. If you can find your product’s unique value proposition and get the word out about it, you’re almost guaranteed to find success.

Never Stop Disrupting

Before the release of the iPhone, the mobile phone industry was completely different from today. Phones were slow and difficult to use. They were physically unappealing. They didn’t deliver a good web browsing experience. There was almost no worthwhile third-party software available. One company – Apple – thought differently, and everything changed. The flip phones of the past are virtually nonexistent today, and every mobile phone maker on the planet copies Apple’s designs.

The e-cigarette industry before the release of the JUUL was much like the mobile phone market before the iPhone. Companies were happy to sell mediocre products because people were going to buy them either way. The industry had no clear leaders because no company was willing to put forth the R&D capital necessary to do something really groundbreaking. The lack of innovation held the vaping industry back and prevented a clear leader from emerging. Quite simply, no company was willing to stick its neck out.

That changed with the release of the JUUL e-cigarette in 2015. To create the JUUL, maker PAX Labs essentially threw out everything about the standard e-cigarette except the basic concept and started from scratch in designing something that would truly be satisfying, simple, user friendly and fashionable. With its head-turning design, intuitive operation and new “nicotine salt” e-liquid, the JUUL e-cigarette blindsided the industry and forced entrenched players to scramble to keep up.

Today, JUUL has a valuation of $38 billion, making the company by far the biggest player in the vaping industry. JUUL itself is now about as big as the entire vaping industry was a few years ago. No matter how big JUUL ultimately becomes, though, it is just one product in an industry that’s still growing. There is still plenty of room for another disruptive product to come along. As long as you’re willing to think differently, it’s possible to unseat the biggest players in virtually any industry.

Image Credit: prostooleh / 123RF Stock Photo

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Jason Artman Jason Artman is the owner and author of eCigOne.com. A professional freelance writer and SEO consultant with more than a decade of experience, Jason works with vaping companies around the world to increase their targeted web traffic and improve their revenue.
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