Players, innovation and regulation: the evolution of e-cigs over the last decade

This is part of a series of articles celebrating the tenth anniversary of Tamarind Intelligence. 

In some ways you could say e-cigarette design has almost come full circle over the ten years that ECigIntelligence has been covering the industry. But really that’s the case in name only. What are termed disposables now have little in common with what used to be called disposables back in the cigalike era at the start of vaping’s mainstream takeoff.

Amazingly, disposable cigalikes are somehow still available for purchase despite such products not offering much in the way of satisfaction, unable as they are to efficiently convert nicotine e-liquid into an aerosol for inhalation.

The development of the cartomiser provided something of a technological revolution for the sector. It meant bigger tanks of e-liquid could be used and, consequently, larger-capacity batteries were needed to power the more powerful devices through the longer periods the larger capacity allowed – all in the name of better satisfying nicotine cravings.

These so-called second-generation or pen-like devices were themselves quickly replaced as consumers started to experiment with products. Modding led to demand for mainstream devices that could be built using different components.

This in turn contributed to advancements in cartridge vaping devices, which had been around but really started to take off with the entry of Big Tobacco into the sector.


The early mismatch of vaping and Big Tobacco


Tobacco companies had taken a wait-and-see approach to the early development of the vaping sector, correctly assessing that if the new product proved to be an opportunity or a threat to existing business, they could swoop in and pick up significant market share through merger-and-acquisition activity relatively easily and for little to no money at all – at least in tobacco terms.

Those that got involved began to focus attention on various cartridge devices over concentrating on e-liquid refills that could be used with a variety of devices. The thinking appeared to be that proprietary technology was the way forward.

But really it was a bad match. Tobacco companies had neither the technological experience to manufacture the electronic hardware necessary nor the know-how to produce significant amounts of nicotine e-liquids from existing tobacco plant supply chains.

There were already companies that could do both better, and most tobacco players appeared to take on their initial brands (previously established ones acquired through buyouts) and then subcontract much of the future product development out to third parties.


China and the golden age of vaping


Companies in China quickly grew to become the leaders in hardware design and production. China always had a large presence in hardware manufacturing. But like in many other industries, a significant enough chunk of that was contract manufacturing, with design and thought leadership still occurring elsewhere.

That began to change. And it soon was Chinese companies developing the latest hardware innovations. Modding also continued to be an important, if niche, part of the sector. However, its impact on the overall sector would get somewhat overstated due to the preponderance of advocates and “celebrity users” who either modded devices themselves or used the products of others involved in the activities.

But tinkerers in sheds in Yorkshire were never going to be able to develop the sort of numbers necessary to significantly impact the overall smoking consumer market. At least not without making the sacrifices to mass production that would have moved them away from their grassroots foundations – a move some did attempt to navigate.

Instead the industry fell into something of a relatively steady pace for a time, with largely Chinese manufacturers providing the hardware and an ever-widening array of international startups creating newer and wilder flavours. In hindsight, this was something of the golden age of vaping.


The rise and fall of Juul in the US


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    In the US, Juul rose quickly based on an innovative piece of hardware that was easier to use and more convenient than pretty much any cartridge product out there. It was small, discreet, quick-charging and, most of all, effective as an e-cigarette. The company combined this with the burgeoning trend of nicotine salt e-liquids for a more effective cessation product.

    But Juul made the fatal mistake of letting all the talk of its being “the Apple of vaping” get to its head. The company forgot what products it was selling and embarked on a massive marketing campaign much in the vein of Apple or other “disrupter” firms that it considered peers.

    The only thing was, none of those other companies’ products contained an addictive chemical. Maybe some of their offerings, such as smartphones and social media, could still be branded as an addictive menace to public health, but as things stood, it was only nicotine-containing products that required government warnings.

    Juul had forgotten this and made some truly questionable marketing decisions, like using models who looked younger than 30. And it came back to bite the company. Hard. A series of lawsuits were launched accusing Juul of underhanded marketing practices.


    Big Tobacco gets back in the game, and changes it


    At the same time the e-cigarette, or vaping, product use associated lung injury (Evali) crisis started to emerge. Although almost entirely linked to the use of THC-containing vaping products due to the inclusion of vitamin E acetate as a thinning agent, all of vaping got tarred with the same brush.

    Vaping never truly recovered in the US market in that its meteoric growth slowed down, and rather than being seen as an intriguing new technological innovation with possible public health benefits, it began to be viewed as a menace to society with Big Tobacco connections.

    This was somewhat ironic as so many in the sector were opposed to tobacco company interference, and, even before such scandals started hitting, Big Tobacco had also already begun to cast its eyes elsewhere.

    As previously mentioned, vaping did not really suit much of Big Tobacco’s existing commercial infrastructure. Products using cut tobacco leaf required much less retooling and modification to processes already in place. Companies such as Philip Morris International had already looked at reduced-risk technology that would utilise such products, but for various reasons found them lacking.

    Nevertheless, advances in technology made a second look worthwhile. So while vaping was burning, Big Tobacco was fiddling away with new ideas that led to the widespread rollout of heated tobacco, leaving vaping as an afterthought – at best – for pretty much all of the tobacco giants.


    Disposables bring a boom, big concerns and ban bills


    At the same time, new players in China were opening shop. Companies such as Heavenly Gifts began to bring a new type of disposable e-cigarette to global markets. Some saw a parallel in this to the early days of vaping. The devices came in a wide variety of flavours, were free of the taint of Big Tobacco in many people’s eyes, and were very, very efficient and effective as nicotine replacement therapy.

    But the products were practically a victim of their own success. By being produced and then sold at such low prices, and because they were so successful at nicotine delivery, concern started brewing over non-users – in particular, young people picking them up to experiment. Reams can be and already have been written about whether the youth vaping epidemic is indeed an epidemic and, beyond that, if some youth use is in fact a bad thing.

    Regardless, these days it looks like regulation will put paid to disposables in their current form. But then, innovation would almost certainly have done the same thing soon enough. Similar to the evolution from cigalikes to second-generation devices, something new would have come along that worked better or was easier to use.

    Looking back at the recent history of vaping, it does seem that the next logical step is for the new version of disposable vaping technology to be beefed up a bit and relaunched as a device with some capacity for refilling and recharging.

    Questions remain over whether such a course then undermines the cheap price that is the main selling point for many of the new wave of disposables. But, as in previous encounters, the main players appear to want to keep playing ball in some form.

    The trouble is, illicit products continue to be produced and find a route to market. To what extent that then undermines legitimate sales will go some way to determining how things progress from here.

    – Freddie Dawson ECigIntelligence staff

    Photo: Centers for Disease Control and Prevention, public domain

    Freddie Dawson

    Senior news editor
    Freddie studied at King’s College, London and City University and worked for publications including The Times, The Malay Mail, PathfinderBuzz and Solar Summary before joining the ECigIntelligence team. He has extensive experience in covering fast-moving consumer goods (FMCG), manufacturing and technological innovation.

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