More Bad News for Lorillard/Blu

[Nate760]

Despite aggressive (some might say reckless) ad spending, and the rollout of ostensibly exciting new product lines (the phrase "lipstick on a pig" comes to mind), things are looking increasingly dire for our friends at Blu. Second quarter 2013, their net market share gain over the previous quarter was +19%. First quarter 2014, however, they're off 2% (which doesn't sound like much, but when your net market share loses 21% in less than a calendar year, it's time to start panicking).

Looks like Jenny Mac will be going back to her regularly scheduled career as a full-time antivaxxer pretty soon.

Lorillard's Dominance Over the E-cigarette Market Is Slipping

 

[rothenbj]

I'm seeing a lot of newbies bypassing the cigalikes and going directly to APVs. I think word of mouth and a growing number of B&Ms starting to take the training wheels off the convert market.

 

[Roger_Lafayette]

There are two things about this piece that really annoy me.

First of all, the only writer at Motley Fool who appears to know a darned thing about vaping is Rich Duprey (who happens to be almost as knowledgeable as Melissa Vondar Haar of CSPNet, which is saying great deal).

Motley, on the other hand, doesn't think that vaping is important enough to assign someone who actually has a clue about this area, and keep them there. In all likelihood the honchos don't know the first thing about vaping themselves, so they can't possibly tell the difference between a reporter who knows very little and one who's about as close to being an expert as one can find in the American mainstream media. (Not that CSPNet and Motley Fool are "mainstream." But none of the other big publications seems to have cultivated experts. We only get lucky from time to time because we end up with a careful reporter.)

So-o what happens when an editor who doesn't know a blessed thing about vaping assigns a quack reporter? You get this (the other aspect of this story that annoys me):

At present, e-cigs are for the most part unregulated, allowing companies to aggressively market them and claim that they are relatively safe. This approach can't be used with conventional cigarettes, and it's a strategy for growth that Lorillard has been using heavily.

Baloney. Blu has always been extremely careful not to make any form of health or reduced risk claims. This boneheaded reporter is mixing up some junk rumor that he picked up in the media equivalent of a bar (i.e. mainstream US media myths and legends) and just repeating it as fact, without checking it.

Should there be a difference between a reporter and someone who goes to a bar and puts stuff scribbled on a bathroom wall into print?

 

[Nate760]

Baloney. Blu has always been extremely careful not to make any form of health or reduced risk claims. This boneheaded reporter is mixing up some junk rumor that he picked up in the media equivalent of a bar (i.e. mainstream US media myths and legends) and just repeating it as fact, without checking it.

Should there be a difference between a reporter and someone who goes to a bar and puts stuff scribbled on a bathroom wall into print?

One of my favorite tropes in e-cig-related journalism (term used loosely) is that the word "aggressive" is always used to accompany any description of e-cig marketing. I, for one, would love to hear one of these reporters explain the difference, in their estimation, between "aggressive" and "non-aggressive" advertising practices. But then, they probably don't even realize they're doing it, since the vast majority of "journalists" have been so effectively programmed that they all reflexively use the same smorgasbord of weasel words designed to make e-cigs and their manufacturers sound as sinister as possible.

 

[FlamingoTutu]

One of my favorite tropes in e-cig-related journalism (term used loosely) is that the word "aggressive" is always used to accompany any description of e-cig marketing. I, for one, would love to hear one of these reporters explain the difference, in their estimation, between "aggressive" and "non-aggressive" advertising practices. But then, they probably don't even realize they're doing it, since the vast majority of "journalists" have been so effectively programmed that they all reflexively use the same smorgasbord of weasel words designed to make e-cigs and their manufacturers sound as sinister as possible.

That and most editors worth their salt have been laid off.

 

[Nate760]

I'm seeing a lot of newbies bypassing the cigalikes and going directly to APVs. I think word of mouth and a growing number of B&Ms starting to take the training wheels off the convert market.

I know there are a great many B&Ms (perhaps a majority at this point) whose owners refuse to sell any product owned by the tobacco industry, so as the number of local vape shops continues to proliferate and fewer people make their initial entry purchases at Walmart or 7-11, that could have something to do with it as well; at least I'd like to think it does. The vaping community, vendors and users alike, absolutely can and should reject any association with BT, and that's one of the best ways to go about it. Vote their brands off the island.

 

[catilley1092]

Part of the dropoff of the Blu & other similar alternatives has to be attributed to they're more expensive than mods & tanks. Though the initial up front cost will be more, those who vapes will save money over the long haul. Even if it's simple ego devices used, there are many quality tanks to choose from.

Buying e-juice by the 30ml or larger bottles are also a huge cash saver.

Personally, I've never tried Blu or any of that line of products. But I know those who does & they spend way more than I do.

As far as The Motley Fool goes, I take many of their articles with a grain of salt. Their targeted clientele seems to be investors, going by the ones that I've read.

Cat

 

[OBDave]

I smell a lucrative future in e-cig reporting...hay editurs, e-maul me fer bio an werk sampeels!

Lorillard introduced Blu to the market?
They aggressively market to juveniles and/or base their business strategy off such sales?
Claims of improved safety are prevalent in mass-market campaigns?

I'm just some podunk writer for the #2 paper in a one-horse town, but those kind of assertions would get me (if I'm lucky) a very stern talking-to. I'm no cigalike pro, given I gave up on them back in 2010 when the 808 v. 510 debate was all the rage, but from what I gather Altria/PM is killing it because Greensmoke has a killer marketing strategy in independent liquor stores (I know a few owners) and PM's Vuse is eating everyone else's lunch because their product sucks less than their direct competitors.

Blu had explosive growth because 1) they were first to market; and 2) they got picked up by a big brand early with advertising money to burn. I wouldn't say that the dropoff signals that they're failing, just that they're returning to earth as their natural competitors enter the market. The early competitive advantage is gone, now it's time to see who (if anyone) can put out a quality product.

Maybe an unlimited R&D budget will result in a cigalike that's functional for the masses. My bet is that it'll just turn more people on to the idea of vaping, which in the end will be a boon for Joyetech, Smoktech, Kangertech, and the other existing big Chinese players.

 

[Kent C]

Could be just an insider play to drop prices in what appears to be 'bad news for ecigs' then at bottom buy back in before the FDA results.... I hate this but .... 'just saying'

 

[OBDave]

Could be just an insider play to drop prices in what appears to be 'bad news for ecigs' then at bottom buy back in before the FDA results.... I hate this but .... 'just saying'

We call that 'capitalism' in the US...misguided, yes. Sad, yes. But so goes the state of affairs...if I had the cash to move on a million shares of Lorillard I'd be on it like stink on a pair of week-old underwear.

 

[Kent C]

We call that 'capitalism' in the US...misguided, yes. Sad, yes. But so goes the state of affairs...if I had the cash to move on a million shares of Lorillard I'd be on it like stink on a pair of week-old underwear.

Not misguided or sad. They really don't know exactly how this will playout, but they might have a good idea... just like we may have from some suggestions. What would be sad is if someone in the FDA played that way, knowing what the outcome would be.

 

[rothenbj]

Part of the dropoff of the Blu & other similar alternatives has to be attributed to they're more expensive than mods & tanks. Though the initial up front cost will be more, those who vapes will save money over the long haul. Even if it's simple ego devices used, there are many quality tanks to choose from.

Buying e-juice by the 30ml or larger bottles are also a huge cash saver.

Personally, I've never tried Blu or any of that line of products. But I know those who does & they spend way more than I do.

As far as The Motley Fool goes, I take many of their articles with a grain of salt. Their targeted clientele seems to be investors, going by the ones that I've read.

Cat

Yes, Motley Fool aggressively markets their products to uneducated, potential clients as a good way to improve their financial situation.

 

[rothenbj]

OBDave, "Blu had explosive growth because 1) they were first to market". I think Smoking Everywhere beat them there if memory serves me correctly. I think Blu came out close to when I started in 2009. I know I was "researching what I should try and I was close to buying into SE's marketing when Blu showed up. It was even more appealing so I threw away a couple hundred before I found ECF.

 

[OBDave]

OBDave, "Blu had explosive growth because 1) they were first to market". I think Smoking Everywhere beat them there if memory serves me correctly. I think Blu came out close to when I started in 2009. I know I was "researching what I should try and I was close to buying into SE's marketing when Blu showed up. It was even more appealing so I threw away a couple hundred before I found ECF.

I stand corrected - Smoking Everywhere was also around when I started for the first time around 2009-2010, mall kiosks, right? And they did have a solid radio presence. I don't know how Blu ended up so popular - IIRC the Blu subforum was crazy active on ECF back in the day - mostly filled with people griping because it was so hard to get their hands on product mixed with a few people who'd actually received product and thought it sucked.

 

[rothenbj]

I stand corrected - Smoking Everywhere was also around when I started for the first time around 2009-2010, mall kiosks, right? And they did have a solid radio presence. I don't know how Blu ended up so popular - IIRC the Blu subforum was crazy active on ECF back in the day - mostly filled with people griping because it was so hard to get their hands on product mixed with a few people who'd actually received product and thought it sucked.

I was in that suck crowd but never visited the BLU subforum. Once I found ECF I ordered manual batteries and was ordering my liquid from various vendors looking for something I really liked. I was a 2-3 PAD smoker and, over those first 6-7 months. I basically broke even with my smoking habit costs. Since then, it's not even close and I buy a lot of new "toys" just to try them.

I doubt that I'd keep vaping if the FDA would ban the technology and allow only BLU type equipment, at least after me supplies ran out. However, I probably have enough supplies and knowledge now to continue vaping the rest of my life without buying anything but PG and VG. One of the advantages of being a senior citizen.

 

[Nate760]

I doubt that I'd keep vaping if the FDA would ban the technology and allow only BLU type equipment, at least after me supplies ran out.

That makes two of us. I spent 25 years giving my money to tobacco companies, and I'll be damned if I'm going to keep doing it when I no longer smoke. And besides, I will never need to vape so badly that I'd be inclined to buy a Blu product.

 

[TyPie]

Having quit smoking cigarettes completely because of them, I will always have a certain fondness in my heart for Blu-Cigs. (God bless Vivid Vanilla!!!)

I think Blu's current decline is due to 2 factors: the fact that many cig-a-like users seem to move on to heavier-duty equipment fairly quickly, and that any first-time users that may be considering starting on e-cigs for the first time have many more options than just a very short time ago.

It's a very big pie, but the size of the slices decrease as the number of them increase. If the FDA and the Government stay out of the way, I think that there is lots of room for many different players, not to mention the development of new products.

 

[skoony]

do to past misadventures in the online cigalike market place,and targeted banner advertising
there seems to be a lot of new cigalike companies coming online every day.
i am getting a lot of spam mail from them,and notice them in banner ads.
different company each time.same sales pitch,some have the same looking websites.
some how ever are actually offering some of there products at reasonable prices
for online purchase.
i am sure this is cutting into big blu's bottom line also.
regards
mike