Is The Vape Market Doomed?
Some financial experts are predicting the end of vaping.
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by Dave Cross
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RBC Capital Markets released a report following their investigation into retailer trends. “Fervour over e-cigarettes continues to wane,” it categorically states. While every store appears to be carrying Gen 1 and Gen 2 equipment all is not well according to RBC – and attitudes towards the hot selling stock appear to be cooling.
According to RBC, the market “continues to struggle and retailers are struggling with too much inventory on hand (which is hurting retailer ability to take on new innovation). We believe this is largely the function of too many brands in the category and brand velocity being too low.”
Monitoring a two-year period, the report highlights the market stagnation in a shocking graph.
- 80% of tobacco retailers reported that they now carry e-cigs, down from 100% in December 2014
- 60% of tobacco retailers reported carrying other vapor products, down from 79% in December 2014
- 21% of tobacco retailers who don't sell vapor products are considering entering the category, down from 70% in March 2014
- 23% of tobacco retailers who do sell e-cigarettes want to expand their offerings, down from 80% in December 2013
So what is the problem? Forums like Planet of the Vapes have never had so many subscribers and many popular brands are supporting the national vape events. Are these cigalike issues being reflected in sales of mods and tanks too?
Apparently, according to the same report, the answer is yes. Fifty percent of those surveyed said they’d seen a levelling off in demand and just 5% claim that business is “booming”. RBC claim that this has given retailers no incentive to expand their business to include third generation devices.
But there is one trend that is very clear.
“When you look at blogs and forums, consumers with cigalikes are fed up with the batteries,” said one of RBC’s analysts. “Do you really think the average smoker wants to deal with this?” Except this was in 2014 when, once again, RBC was predicting the plateau and terminal decline of the vape market. The company seems to be consistently offering a gloomy outlook that raises a question: why? Could it be that they have an interest in promoting a competitive product’s shares to their clients?
Photo Credit:
E-cigarette chart from RBC
Dave Cross
Journalist at POTVDave is a freelance writer; with articles on music, motorbikes, football, pop-science, vaping and tobacco harm reduction in Sounds, Melody Maker, UBG, AWoL, Bike, When Saturday Comes, Vape News Magazine, and syndicated across the Johnston Press group. He was published in an anthology of “Greatest Football Writing”, but still believes this was a mistake. Dave contributes sketches to comedy shows and used to co-host a radio sketch show. He’s worked with numerous start-ups to develop content for their websites.
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