Hello to fellow vapers everywhere! It’s been a rocky litle bit, but things here at SMOKELESS are finally getting up off he ground and then some it seems after unrelated tribulations…. I DO assure you we’ll be having many posts a week (aim is 3 a day soon) so I thank your patience, will be worth it. Now On With the Latest Article – A Bit of A Long One (and i will add some pizzazz – visually and editing wise :-0 just eager to get it up!)
NJOY is probably the biggest ‘non Big-tobacco’ owned electronic cigarette brand – in America at any rate – and have been in the industry a long time in ecig years (they were the main guys who took FDA to court years ago to wrestle back the right to sell e-cigs and stop having products seized by the FDA the first time around, when it could have killed ecigs from even getting out of the starting gate. For that we all owe them a debt of gratitude certainly.
This is a piece about bigger vaping trends more than it is meant to specifically profile NJOY. They happen to be a particularly interesting example however – I would suggest one of the more potent ones to date – illustrating the broader movement towards portable vaporizers (aka APVs, Vape Pens, EGOs/EVOD style tank systems) and how significant the trend has become.
NJOY have taken a very ‘cig-a-like’ centric view for years – NJOY made their intent clear in 2012 (as they hyped the launch of their ‘NJOY King’) to create the most realistic emulation of a cigarette. Re-reading PR from the time remind just how fast things change when it comes to smokeless cigarettes and the vaping market.
Bonnie Herzog, an analyst at Wells Fargo & Co. (known well for her projecting that ecigs may likely outsell their tobacco counterparts within the decade) states in a Bloomberg article (http://www.bloomberg.com/news/2012-12-05/e-cigarette-maker-njoy-seen-as-takeover-target-amid-innovation.html) about NJOY’s product:
“The market for e-cigs … may rise to $1 billion in the next three years from $300 million in 2012”
We know that undershot the mark now, with the market well into the multiple billions in 2014. Discussing what were a new product type to most American’s still as what we now call ‘Cig-A-Likes’ (a term I slightly despise, to me it wreaks of cynicism and snobbery – quaint and obsolete products only noobs might buy). While it still represents a massive market segment, Herzog’s further comments in the same article illustrate her enthusiasm for what NJOY chased more intensely than any other brand.
“It is truly a wakeup call for Big Tobacco,” Herzog said this week by telephone from New York. “If manufacturers can create something that tastes, looks, feels and smokes like a traditional cigarette with substantially less risk or harm, more consumers are going to try them and retailers are going to give them more shelf space.”
It seemed back then more than reasonable to assume that would be the pinnacle ‘killer-app’ for smokers, and what the ecig market wanted. The finish-line for which would spill endless riches to whomever managed to reach it first.
Many a brand still claim in their marketing cliché riddled copy to be ‘the best e-cigarette’ in part due to being ‘the most realistic’ smoke-like experience. But while most continued to market and resell the same OEM products as everyone else was, NJOY in particular embraced the aim to achieve a truly ‘cigarette-like’ vaping experience. Creating a cigarette in all but the smoke and tobacco. Their every effort went on to focus on creating the idealized, archetypal ‘electronic cigarette’ as many imagined it at the time (a whopping 2 years back!).
NJOY’s own advertising made it pretty clear, with the tagline “Cigarettes, You’ve Met Your Match.”
Roy Anise spent 24 years working at Altria on new products before joining NJOY in Executive Vice President role. In 2012 he stated NJOY’s company goal was to make cigarettes obsolete, and that NJOY would accomplish that was through “Replacing them as they are currently designed … Our goal is to take a look at a cigarette like a Marlboro. How do we not just be as good, but how do we become a superior smoking experience?”
Cementing the commitment to ‘cigarette-like’ products that accurately mimic the smoking experience he concluded:
“We are going to become the new way to smoke with a product that as closely as humanly possible replicates the actual smoking experience.”
If You Can’t Tell It’s Not A Cigarette (Can You TRULY Have You’re Smoke and Smoke it too?)
To me its as if the unquestioned race NJOY lead was towards a mythical ultimate ‘ecig’ that might pass some odd version of a smokers ’Turing Test’ – hopefully absent the AI! Lol, now I can’t help but envision some sci-fi vaping nightmare where Blu’s ridiculous social ‘smart pack’ cases version X – after being bought by Apple in a parallel universe – feature SIRI cheerfully demanding you buy it some refills – notifying how conveniently they’re on sale at the corner store 8 steps away.
NJOY’s Gimmick Was At Least Directly Related To The Product and User Experience
The NJOY approach seemed one of ‘betting the farm’ so to speak on this product category when expanding and moving away from their early starter kits. I recall the NJOY of the day, peddling what were simple OEM branded versions of generic rechargeable e-cig models (and not very good – though the same ‘super cigarette’ converted myself, that was 5 years ago – things have sure changed for the better since then).
It used to seem that these companies chose what ecig to sell almost at random, that any ecig was an ecig was an ecig.
This type of decision, however it was made, haunts or helps to an unfortunate degree too many brands to this day (and probably contributed to some of the ones no longer in business). Many locked themselves to specs that did not evolve gracefully, yet presumably afraid of messing with their customer base and their brand compatibility don’t want to shake the boat (Blu Cigs and Green Smoke both are in this spot). NJOY at least have shown they have the balls and the brains to not let any of that type of potential lock-in prevent change when it is called for. It appears they’ve let go of all the products that should stay in the past while evolving in-line with their own convictions and vision – whether you argree with the directions personally or not, it looks good on them to make the moves many couldn’t.
As pioneers in the industry NJOY certainly deserve credit in taking a bold move with the KING product; but one they seem to have finally realized was not the right bet (not that they have abandoned the ecig or anything). Taking bold risks and following a clear vision is what can make huge success in any industry – many would say it’s a necessary trait of all iconic leaders (brands or their CEOs). But for every iconic name that goes down in history for getting it right – over the long haul, how many corpses rest in their wake?
In this story its looking more and more like NJOY’s big bet may have been off the mark entirely.
It’s clear they can suck it up and change – but I’m left wondering if NJOY can embrace and thrive while following consumer demand somewhere so unlike the path they had laid down.
Can NJOY ‘pivot’ (to insert even more über silicon valley / VC speak) quickly and succeed in a market going in the opposite direction?
No story of grand success would be complete without a collapse and rise from the ashes (pun intended – did they use that line in an ad?). I do question whether it will be possible to thrive with a new vision that necessarily is not in-line with their professed instincts that drove those initial bold decisive steps – can such a changed vision truly be embraced and succeed?
Re-reading company quotes from 2012, while considering and exploring NJOY’s change of focus – which definitely seems to center on their new EGO-style ‘NJOY VAPING’ unit – does if anything convince me of the significant money being spent on vaping class devices. If you have any doubt about the extent of NJOY’s ‘change of heart’ check out their official ‘assistance’ website, http://www.howtonjoyvaping.com, designed to guide the ‘vaping-virgin’ new user through the complexities of operating a non-cigalike… clearly they want to cover all the bases, its um fairly basic yet very extensive).
A Trip Down NJOY Memory Lane – They Would Be Kings
When NJOY released their ‘NJOY Kings’ (complete with a squishy feel, a paper-wrapped ‘filter’ look and feel, truly heavy hits of nicotine at very high strength concentrations – able to achieve the intense throat hit of ‘real’ cigarettes and a flavor said to mimic traditional tobacco’s nasty ashy taste, yipee!).
While industry analysts cited NJOY’s accomplishment as a milestone in what was assumed to be ‘the goal’ of emulating cigarettes most accurately, many vapers didn’t particularly like it for the very reason of it being so ‘realistic’. It would seem (and I speak from much personal experience) most Vapers after having adjusted to ecigs, having acclimatized their expectations to the novel experiences and range of flavor embraced through what have been called ‘electronic cigarettes’ (perhaps unfortunately in some ways) something that is so cigarette-like is no longer all that appealing.
To me it would seem NJOY if anything created a great transition product – first time users could do a whole lot worse, but very quickly they realize they want a whole lot better and a whole lot more. Leaving many repeat purchases unlikely.
The King packaging had been in the style of a traditional tobacco cigarette branding; with gold and red emblems and a pack shaped (albeit made of polycarbonate durable plastic) to match traditional smoke packs and sold next to them. Like Big Tobacco that has meant predominantly in retail outlets, all the typical gas and convenience stores where smokes are sold.
Again in fairness they seem to have achieved their goal rather well, and the bet on pushing the whole cig-a-like concept to its extreme of ‘cigarette likeness’ wasn’t altogether a naive or misguided. I myself had expected the majority of the market’s dollars (and volume of users) would continue going to the simpler to use, ultimately way less complex cig-a-like category for years to come – though I never viewed the goal or frankly the appeal for users as emulating tobacco smokes so accurately.
I’m not aware of any partnerships with existing tobacco brands NJOY may have entered into as its not exactly a small undertaking breaking into the supply chain for maximum saturation. Checking their site today in October 2014 I see:
_**NJOY is the only national brand in all 50 states that is not owned by big tobacco, making NJOY truly America’s favorite electronic cigarette.
With more than 90,000 retail locations nationwide, you can find NJOY Kings and other leading NJOY products at your favorite local convenience stores. To find a store that carries NJOY near you, simply enter your city and state or ZIP code in the search box below.**_
Those are some impressive numbers indeed, but they have had time (vaping years seem to equate to silicon valley’s ‘internet years’) to make serious inroads.
This of course is just what Big Tobacco has no problem with after decades of building the logistics and relationships to have say Blu Cigs instantly available right next to Marlboros and Camels everywhere in the country – and potentially WELL beyond). OK, just checked on Blu’s claimed numbers and surprise surprise they claim 100,000+ locations (there may be some creative math going on being that close to NJOY on one side or the other!) but in either event they are both well and firmly planted. From BluCigs.com
_**blu eCigs are now in more than 100,000+ retailers nationwide, including several national retailers as well as many regional retail stores. Find and buy an array of blu eCigs products, including: blu disposables, original rechargeable kits, and flavor cartridges.**_
NJOY may have had the name recognition factor and hype from industry analysts like Bernie Herzog at the highest levels of finance wouldn’t have hurt any; though I suspect NJOY still isn’t quite as easily available as Blu – I’ll look that up and let you know.
For V2 Cigs clearly the decision to hook up with ‘National Tobacco’ of ZigZag fame was a play benefiting both companies and illustrated the savvy of V2’s business acumen for the countless time. It looks like V2 are still a way back, from a recent press release:
_**VMR’s industry-leading brand, V2, is now carried by more than 40,000 locations in the US and over 10,000 locations internationally, across 30 countries, including the UK, Germany, and Russia. **_
That said, V2 Cigs built its name and reputation – along with its customer base who are extreme loyalists – online. The brand still sell more ecigs (and have made series vaporizer inroads themselves now too) through online sales.
One of the key curveballs to come along and effect this whole trend however has been the rise of the ‘Vape Shop’. In a modern day incarnation of ‘Mom and Pop’ Cigar stores across the country specialized in person retail outlets who sell typically a massive range of generic products, often paired with their own or other boutique e-liquid brews. Recent numbers I have read are somewhere around 3,500-4,000 such novel specialty stores (some one of a franchise, many a single location small business). Those who are serious about vaping (and increasingly casual ecig users are – as NJOY’s moves help illustrate), often buy at these locations or else at their online kin. Vaping super-store’s like Dragonfly ECigs, or in my neck of the woods where the things are less legal (maybe) CanVape and HappyVaper, here in Ontario.
The Trends Are Pretty Clear, Even If The Reasons For Them Are Much More Multi-Faceted
When looking head on at dollars and marketshare – trends clearly reveal that there has been a major shift brewing (and that many signs now leave no doubt about – NJOY making the shift they have amongst them). The vaping and ecigarette market is electing for a very different product type, the upsized and more powerful ‘vaporizer pen’ aka ‘open system vaporizer’. These products have stirred some controversy (what else is new in this young industry) and red-faced big tobacco executives are shouting foul.
Big Tobacco have to-date similarly (to njoy) focussed on what made sense through their eyes and wallets perhaps more understandably than others, ecigs that look and act more or less like traditional tobacco cigarettes. Any hints of such a trend away from the category poses a massive threat to most of their key points of leverage on the ground in the ‘e-cigarette dominance wars’. Aside from the bankroll they have to market the products aggressively, the biggest single factor these corporations have going for them is well-entrenched and mammoth distribution chains, logistical networks to get the product in tens of thousands of retail stores and a snap of their fingers.
Verifying to many was the recent filing from RJ Reynolds of a 119 page complaint to the FDA urging for a ban on the ‘Vape systems’ customers have been buying in greater and greater proportion (indeed overtaking the smaller traditional e-cigarettes in the last quarter). Looking double-sided and hypocritical the giant firms state public health concerns and ask for outright bans on what are essentially up-sized versions of what they themselves have been selling while attempting to buy up the industry wholesale on a brand shopping spree.
NJOY for their part have been a hold-out as far as resisting any takeover bids that surely have come their way. Like V2 Cigs, NJOY seem to be pushing the very fact of their independence from Big Tobacco as a core marketing message; many vapers have stated in recent surveys that they actively avoid buying anything owned by the ‘evil empire’ of tobacco corporations (which includes Blu Cigs and Green Smoke amongst others).
NJOY’s rebranding that rolled out in the last couple of months along with radical product offering changes have illustrated the pressures and reality of the ‘Mini’ E-Cigarette move towards ‘Vaporizer Pens’ trend.
While the topic is more complex than it might first appear, the fact is money is increasingly going to the larger devices and at very least re-fillabe, re-useable, re-chargeable units – are the minimum most consumers will go for. In general Disposables are not going to cut it; a sad fact for brands focussed on them as the model is most costly for buyers (often not savings anything in contrast to smokes) and earning the most comparatively by those selling them.
NJOY’s Move Is Not The Only Similar Occurance – But It’s The One That Says The Most
While other longtime e-cigarette brands have expanded to vaporizer offerings (V2 PRO from V2 Cigs is the most clearly calculated and unique new product, clearly betting hard on this direction – SmokeStik too have released their ‘EGO Vape’ style product, the SmokeStik ULTRA). NJOY though is a bit of a special case when it comes to reading the industry through its actions
When you take a hard look at the definitive 180 degree turn NJOY seem to have made – listening to the market despite it not agreeing with previous convictions, well, its a case where actions speak volumes. NJOY E-Cigs as a public facing brand have been probably the most vocal proponent of the ultimate “cig-a-like” vision. Today they arevselling both ecigs that include re-chargeables to a much higher degree and yes, even an “EGO Tank” style portable vaporizer pen (and the flavored e-liquid offerings to go with it).
My intent in writing this piece is in no way to put down NJOY for bending to realities of the market – if anything I applaud them for having the savvy and courage to do so. Frankly like many vapers I am exceptionally distrustful of Big Tobacco and despite their role in perhaps avoiding the worst type of regulation (so far) as an outcome, the giants could and would (in fact are trying to) stomp to death anything that doesn’t play to the leverage they enjoy or that challenges them in an area where they have no chance of being competitive. The later is in my eyes the most crucial and inspiring element of the never-dull and unfolding latest vaping chapter.
As Malcom Gladwell makes the focus of his most recent pop-psychology/marketing tome ‘David and Goliath: Underdogs, Misfits, and the Art of Battling Giants’ – the BIG have many things working against them that smaller players do not. Chief amongst them being nimble, quick and adaptable; able to take the bold steps, even 180 degree changes that simply aren’t feasible with big beaurocratic approval processes and business processes holding a company back.
Maybe, Just Maybe… Could Big Tobacco’s BULK Work Against It Here?
It would certainly be a kind of poetic justice should these multinational tobacco companies collapse in on themselves – or at least have their attempts at turning ‘e-cigs’ into a corporate elixir. What looked like the perfect answer to a desperately sought “business life-extension” – Botox for a dwindling tobacco industry. An industry that most had written off to die a slow and (many WOULD say well-deserved) aggonizing death.
Note: I feel a little chill writing such a suggestion knowing that these guys still have more than a little lobbying muscle and bankroll to make things happen – or make them not happen. And they have already shown a perfect willingness to do so.
Reynolds America filed a 119 page petition to the FDA recently, decrying the need to outright ban ‘Open Vaping Systems’ (like the ‘NJOY VAPING’ product) attacking vaporizers in all shapes and forms (other than those they sell, ahem resell).
Like the prized characteristics of silicon valley startups, being nimble, energetic, not burdened with elaborate bureaucratic decision making and approval processes – smaller players of significance who actually involve themselves in innovating new products and technologies will destroy big tobacco when it comes to sheer innovation and competitiveness in this lighting paced industry of change. Most of the credit for that honestly is owed to another fanatically competitive and perhaps more nimble than even silicon valley part of the globe – schenzen china and the ecig manufacturer/brands leading the race for best, better and next. There are a few exceptions however, and admittedly NJOY (together with V2 Cigs, now more than ever) can be counted among the few.
The style and type subsequently picking up the widely used ‘cigalike’ moniker. _