Built-In Advantages Give Big Tobacco an Edge in E-Cigs

The Big Three are now in it to win it. 

If there was ever any doubt that major tobacco companies have designs on the emerging electronic cigarette market, a recent roundup in the Wall Street Journal makes the case with ease, something that eager acolytes of e-cigs are anxious to avoid. No doubt about it, Big Tobacco wants in.

Results from intensive test marketing in Colorado have, like a political primary, provided an early indication of where the popularity lies. Reynolds American, the nation’s 2nd largest tobacco company (Camel), led the, uh, pack with its offering, the Vuse e-cigarette, introduced in July. Vuse racked up a 55% market share in that state. Next in line, with 25%, was Blu, owned by the 3rd largest cigarette maker, Lorillard (Newport). NJOY, an independent company, came in third.  The elephant in the room, Altria Group, the largest U.S. tobacco firm (Marlboro), is still in the test marketing stage with its e-cigarette entry, the MarkTen. Altria began testing the MarkTen in Indiana and Arizona in late summer.

It took Reynolds less than 16 weeks to achieve market dominance in Colorado, and the company made sure that investors heard about it. With 1,800 retail outlets in Colorado, and a database of 12 million tobacco consumers, Reynolds is perfectly poised to benefit from the inherent advantages of being Big Tobacco. The Big Three have three major head starts, the Wall Street Journal reported: “extensive distribution networks, existing customer relationships numbering in the millions, and deep pockets.”

The market for electronic cigarettes has broken a billion dollars, say stock watchers. This magic number seems to have energized the Big Three to take a heavy step into a market that has been around in nascent form since 2006, even though it’s still small change compared to the $100 billion U.S. tobacco market. It was not clear, in the beginning, whether Reynolds, Lorillard, and Altria would attempt to, pardon me, snuff out the competition, or dominate it. That decision now appears to have been made, and the game is on.

Stephanie Cordisco, president of R.J. Reynolds Vapor Company, which markets Vuse, said the marketing tagline in Colorado was: “A perfect puff. First time, every time.” 

So far, e-cigarettes, which heat nicotine-based liquid to create a vaporized mist, have benefitted from the fact that they are not, at present, savagely taxed like regular cigarettes. And e-cigs come in flavors, cherry and pina colada being among the favorites.

In April of 2012, Lorillard broke the e-cig barrier when it acquired Blu Ecigs for $135 million. At the Wall Street Journal, Mike Esterl suggested that the move came “as the Food and Drug Administration weighs a possible crackdown on menthol-flavored cigarettes, which represent about 90% of revenue at Greensboro, N.C.-based Lorillard, owner of the popular Newport brand. The FDA already has banned all other cigarette flavors.”

Reynolds followed Lorillard into the market early in 2013 with Vuse. And the giant Altria Group announced in October that it planned to expand sales of the MarkTen after successful “lead market” sales. It’s too early too say how it will go for the MarkTen, but Altria CEO Marty Barrington said in a conference call reported by the Richmond Times-Dispatch that the company is not overly worried about cannibalizing Marlboro sales: “I can tell you that with respect to who is trying the products in e-vapor generally,” he said, “ we do know that there is dual use. As adult smokers try e-vapor products, we know that some of them are satisfied and others are not. Some of them use [e-cigarettes] situationally.”

That does not sound like an executive rolling out a stop-smoking therapy tool.

Graphics Credit: http://seekingalpha.com

Author’s Debut is a Tough, Lyrical Addiction Memoir

"If we don't change direction soon, we'll end up where we're going."

 –Prof. Irwin Corey

I’ve never made a secret of the fact that I don’t really like addiction memoirs—with notable literary exceptions, from Thomas de Quincey to William S. Burroughs, including worthy modern efforts from James Brown, Jerry Stahl, Sacha Z. Scoblic, and others. Writing well about addiction is a rare gift, and newcomer Jessica Hendry Nelson, in If Only You People Could Follow Directions: A Memoir, comes at the problem elliptically, in some cases deliberately pruned of strong emotion. This works in her favor, as she eschews over-the-top bravado for the facts of life. The book is, heartbreakingly, a book about family—about the power of substance abuse, self-destruction, grief, and remorse to tear away at every connection human beings share.

Childhood: We found his battered truck in a Shop Rite parking lot, the smashed headlights still pulsing lazily into the mist like two dying fireflies. The parking lot was empty except for the truck, a few wayward shopping carts, and the streetlight that had blocked my father’s passage. I wasn’t yet able to distinguish my waking life from my dream life, and so it all felt like fantastic fun.

Childhood’s End:  There were a couple sober years, when Eric and I were in early elementary school. Since then, he’s had at least two DUIs a year, and cycles from jail to rehab to halfway house and back again. Occasionally, he’ll manage a few sober months in a halfway house and occasionally he’ll stay with his mother in anticipation of getting his own place. During those months, there is lots of talk of the future, of our own bedrooms and weekends spent watching movies and skiing at the Pocono Mountains, but it never happens.

The father: Before talk therapy. Before asbestos removal jobs and wrecked cars. Nights so hot and black they burned like a solar eclipse through his insides. Before little league games and parent-teacher conferences. Before he fucked the three-hundred pound housewife next door for a couple of Klonopin. Before she killed herself with the rest.

The author is young, but as my friend James Brown, who wrote the powerful addiction memoir, This River, has put it: “Jessica Hendry Nelson knows the power of clean, sparse prose, and her keen eye for the small, most telling details of character show an insight into the human psyche well beyond her years. Her story is oftentimes a dark one, but Nelson holds strong, knowing that saving those we love may first begin, and end, with saving ourselves. A remarkable debut by a wonderfully talented writer.”

The brother: The first offense is theft, though many others will follow—a wildly colorful rap sheet—but the disease that makes him do such things is just an infant now, just an infant throwing its peas.

The mother: She is sad because Eric has taken to snorting Oxycontin in her bathroom, still lying and stealing and denying in that same fucking straight-faced way as the husband once did, until she feels she’s gone completely nuts. I know how she feels, and yet I am unable to change it.

The family: We are practiced in the art of pretend. We are able to convince ourselves that drinking and smoking are incidental, and not part of the fabric of our family, of the shared anxieties that causes us, each to varying degrees, to feel so dissatisfied with our own brain chemistry. We are trying to return to a place of innocence, to the time before, when Mother could still keep us safe. We keep trying, but morning light is unforgiving.

The book reads like the product of an older, more experienced writer. It's impressive, if somewhat digressive, but Nelson is undeniably talented, working in a terse, slightly distanced style, as if the truth of it all required some detachment for her own sake. Impressionistic, episodic, the book is composed of scenes weaving in and out of chronological time. We don’t get it all put together until the end, but when we do, we see an unbroken spirit standing in front of a long and dismal line of hospitals, police stations, institutions, and halfway houses.

The treatments: My mother picks Eric up from the halfway house in North- east Philly where he’s been staying. It is ten a.m. The halfway house is the right side of a narrow duplex. Houses brick and broken. Next to the halfway house is the crack house. Next to the crack house is the whorehouse. Next to the whorehouse is a family with two adorable little girls.

The cycle: That’s the disease talking, they say, and I try to believe that too. For years, I believed, but all I see, finally, is my brother’s hard familiar face and the illness that my mother continues to try and kiss away with love and money and blunt maternal strength until she, we, are all as sick as Eric—the dead father’s legacy, this disease.....

We bring the bottle. We have learned to just bring the bottle.....

Give it up, let it go, take it back, take control. Say yes. Say no. Say no, no, no. Stick to the script. Step One through Twelve. One through Twelve. Keep coming back. It works if you work it. If only you people could follow directions.

Grab Bag of Addiction Links

Recent reading from around the net.

Can Medical Marijuana and Recreational Marijuana Coexist?

“The Washington State Liquor Control Board released recommendations for what to do with the state's medical marijuana system now that recreational marijuana is legal.” [Atlantic Cities]

Premature claims of a cannabis addiction "cure"

“Have scientists found a ‘cure’ for marijuana addiction? New treatment blocks the kick that users get from the drug,” reports the Mail Online. Based on the evidence presented in the study, which involved animals, the answer to the Mail’s question is 'not yet'. [NHS Choices]

Can Gambling Machines Prevent Addiction?

“Today's digital slot machines and poker screens in casinos and at online gambling sites are capable of amassing a wealth of behavioral data on individual players, and they are on the verge of altering game play on the fly.” [Scientific American Mind]

Food for thought: UF researcher’s book lays out evidence for food addiction

“For some, the famous potato chip slogan “Betcha can't eat just one” isn’t a wager — it’s a promise.” [University of Florida Health]

New Zealand’s bold experiment with regulating recreational drugs

“It’s been nearly a century since the United States began its experiment in prohibiting recreational drugs besides alcohol, caffeine and tobacco — and virtually no one sees the trillion dollar policy as a success.” [Reuters]

More Than 1,000 Meet in Denver to Develop Drug War Exit Strategy

“Which state will be next to legalize marijuana? What do the Obama administration's recent announcements about marijuana legalization and mandatory minimums really mean?” [Huffington Post]

This Is Why Social Media and Drinking Alcohol Don't Mix (Infographic)

“Engaging with peers and customers on social platforms can be dangerous. Doing so while you’re under the influence of alcohol is downright irresponsible. “ [Entrepreneur]

Economists Predict Marijuana Legalization Will Produce "Public-Health Benefits"

“In their 2012 book Marijuana Legalization: What Everyone Needs to Know, Jonathan Caulkins and three other drug policy scholars identify the impact of repealing pot prohibition on alcohol consumption as the most important thing no one knows.” [Forbes]

Photo Credit: http://lifeonthebalcony.com/