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Atomization e-cigarette industry expands rapidly but disorderly, traditional cigarette enterprises may wait for market development

2021/03/04|Knowledge

In recent years, e-cigarettes as a new product has been widely concerned by the market. The reporter of Financial Association visited Chengdu e-cigarette exhibition and learned that although the e-cigarette industry has experienced many years of development, it is still in its infancy, with many problems such as low entry threshold, poor sustainable development ability and unclear audience positioning. Some market participants believe that e-cigarette has eroded the traditional cigarette market of China tobacco, and China tobacco may rely on HNB differentiated products after waiting for the market to develop by itself Seize the market.

Accelerated expansion of the industry and disordered development damage the interests of agents

Recently, the blue hole electronic atomization city tour was held in Chengdu for the first time. The offline tour includes 25 e-cigarette brands, including Yueke, Bode, Magic Flute, Sichuan Zhongyan kungfu, etc. According to the organizers, more than 2000 people signed in after the conference, which was very crowded.

The reporter noticed that Zippo, a well-known American metal lighter brand, is also among them. The reporter went up to talk with the staff and expressed his surprise at Zippo's entry into the e-cigarette industry. The other side said: "the e-cigarette industry is relatively new. In the early stage, we need everyone's awareness of the brand. Now Zippo wants to use the brand influence to seize the high-end market of the industry and obtain high profits."

Subsequently, the staff introduced several series of products to the reporter, and their outer packaging left a deep impression. In the exchange with the staff, the reporter learned that the threshold of e-cigarette industry is low, and the industry status is uneven. "Now you can set up a brand with tens of millions of dollars, as long as you have" production of electronic products "in your business scope." The other side said so.

Indeed, according to AI media consulting data, as of February 4, 2021, there were 174399 existing e-cigarette enterprises in China, and this number was only 457 in 2013. In terms of growth rate, the growth rate of domestic e-cigarette enterprises will reach 30.27% in 2020.

However, the rapid expansion of e-cigarette industry has triggered a "stock game" among agents. An agent who came to select brands and prepare to open stores told reporters that although the overall scale of RLX is very large, the distribution of goods is particularly fierce, diluting the profits of a single store. "I'm not optimistic about Yueke. Now I can't get its agency right. There are dozens of stores in a small place, and the scope of the stores is reduced to 200 meters. Even the barber shops are selling goods, and there is no market for the exclusive stores." The above-mentioned agent said so, and disclosed that his relatives and friends opened several Yueke stores in Yibin. Because of the new entrants, the profits dropped rapidly.

The person said that he intended to join the magic flute brand, but Magic Flute told reporters that the brand is also accelerating its expansion this year: "there are about 70 stores in Chengdu, and it is expected that there will be 200 stores this year. At present, there are about 3000 shops in the first tier cities and more than 200 in Southwest China. This year, 650-800 shops are planned in Southwest China. "

The publicity audience is not clear, and the original intention is contrary to the reality

The reporter noticed that the people who came to know about the brands of each booth all said that e-cigarette is a product to reduce the harm of cigarettes. Compared with traditional cigarettes, it reduces tar, carbon monoxide, nicotine and other harmful substances. However, it seems that its target is not "old smokers".

In terms of advertising, A series of Vazo's slogan is "new trend of national style", and vvlid Ono invited Edison Chen as the spokesperson. In terms of packaging design, all brands have made great efforts on cigarette poles. In front of gradient colors and various theme colors, color is the basic style, and the GTR series cigarette poles of Bode also have luminous effect. In terms of taste, an agent of Magic Flute booth told reporters: "most old smokers are only smokers I like to smoke prairie style cigarette bombs. " However, there are not many tobacco flavored cigarette bombs in the display cabinet, but all kinds of fruit flavor, cola flavor and Matcha flavor, which are quite similar to milk tea shop.

In the taste, design, publicity and other aspects, e-cigarettes are openly waving to young groups. One intended dealer said to the reporter, "e-cigarettes are aimed at young people." Yueke brand told reporters that the word "audience group" belongs to the industry taboo, unwilling to discuss the topic.

The same is true of offline sales channel feedback. The owner of an e-cigarette shop near Wangjiang campus of Sichuan University told reporters that most of the customers in the shop are college students, and this group has the phenomenon of following suit. Many new customers are recommended by friends and classmates to buy. It is worth mentioning that during the interview, the reporter also met a customer who came to change the flavor of cigarette bombs. The customer said that he was a minor, and the shopkeeper met his needs despite hesitation.

Data show that e-cigarettes only partially reduce harmful substances, and there are still nicotine, formaldehyde and other ingredients that affect human health. At the exhibition, a staff member of the company also told reporters that at present, electronic cigarette oil does volatilize a small amount of formaldehyde in the process of combustion, and the cell will emit toxic heavy metals in the process of continuous combustion. It is questionable to recommend e-cigarettes to non-smokers, especially young people.

HNB heating does not burn, China tobacco or waiting for market development

Interestingly, two HNB heating non combustion e-cigarette brands joined the exhibition, namely "Xiangyu" and "Kungfu" of Sichuan Zhongyan. Among them, Xiangyu said that the company's HNB e-cigarette has been developed for several years. The heated plant core of the product is extracted from pure natural herbs, and does not contain tobacco monopoly substances. The international mainstream homogenization slice process is used in the smoking section. It will be sold to the market in April this year, and is now soliciting first and second level agents from all over the country.

The reporter noticed that behind Xiangyu is the listed company Jiyou (603429. SH), a long-term supplier of China tobacco. According to Tianyan data, Jiyou has continued to increase its e-cigarette field in recent years, and the registered capital of its e-cigarette subsidiary "Jiyou Guangyu" will increase from 20 million yuan to 50 million yuan in 2020. However, the reporter called the relevant personnel of the company, the other side said that the market situation of e-cigarettes was not very clear, and no one answered the call from Jiyou Guangyu.

Compared with other electronic atomized cigarettes, Xiangyu doesn't have too much taste, its taste is closer to traditional cigarettes, and its packaging and publicity are not young and fashionable.

Although Xiangyu declared that its HNB products did not contain tobacco, some brands and intended agents still expressed their dissatisfaction with the products. They think that the content of harmful substances in nhB is no less than that in traditional cigarettes, and it has a paste taste when smoking. Some would-be agents who don't know the ingredients of the relevant products think that HNB is a traditional cigarette. Xiang Yufang told reporters that the product is addicted by adding nicotine salt, and the nicotine content is 5%, which is higher than 3% of other atomized e-cigarettes, close to that of traditional cigarettes.

In addition, China Tobacco Sichuan home exhibition, bringing the "Kung Fu" brand. In June last year, Sichuan China Tobacco opened the first "Kung Fu" HNB offline experience store in Chengdu, officially setting foot in the domestic e-cigarette field. Before that, the brand had been sold overseas. It is understood that China Tobacco's traditional channel is to make traditional cigarettes, so in recent years, it launched HNB (heating non combustion) differentiated products to seize the market share eroded by atomized e-cigarettes.

A person in the industry said that China tobacco has been exploring in the field of e-cigarettes, but it has not made any big moves. Maybe it is just waiting for the market to be cultivated first, and then using its brand and channel influence to cut in.

Information shows that HNB is mainly characterized by using external heat source to heat tobacco to produce flavor gas. Currently, the largest HNB brand in the world is iqos launched by Fimo international in Japan, with more than 1000 patents in this field. Because HNB is a tobacco product, the production and marketing of HNB are managed by China tobacco. At present, there is no product on sale in China. Some analysts also pointed out that the reason why China tobacco has been laying out HNB but has not dared to put it on the market may be that it is difficult to avoid the relevant patented technology.

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