Vaping involves the use of electronic cigarettes, commonly known as e-cigarettes, to replicate the

experience of traditional cigarette smoking. E-cigarettes function as battery-powered or rechargeable smoking devices, with various designs resembling traditional cigarettes, pipes, pens, or USB memory sticks. These devices utilize a cartridge or pod filled with liquid, typically comprising nicotine, flavorings, and additional chemicals. Upon puffing on the mouthpiece, the heating

element within the device is activated, heating the liquid in the pod and transforming it into vapor. The inhalation of this vapor is what gives rise to the term “vaping.” 

Introduced in 2015, Juul swiftly ascended to prominence, earning widespread recognition for its sleek design and innovative technology that delivered a satisfying nicotine hit. With a discreet appearance and user-friendly features, the brand resonated with a diverse audience, contributing to its rapid success. The surge in popularity among minors prompted public health concerns, triggering regulatory scrutiny and legal actions. Juul found itself at the center of accusations, with critics contending that the brand had contributed to a youth vaping epidemic. Governments, particularly in the United States, responded with the implementation of stricter regulations on vaping products. Flavor bans and restrictions on sales to minors were among the measures enacted, directly impacting Juul’s market reach and sales. Amidst these regulatory challenges, Juul faced additional hurdles in the form of health controversies. Increasing reports of vaping-related lung illnesses and growing concerns about the long-term health effects of vaping cast a shadow over the entire industry. Juul, as a market leader, found itself under intense scrutiny, with the company facing lawsuits and investigations related to health issues associated with its products. The ongoing legal battles have proven to be a significant impediment to Juul’s recovery. The company is entangled in numerous lawsuits, including claims of deceptive marketing practices and allegations of deliberately targeting minors. These legal challenges have not only added financial strain to the company but have also tarnished its once-positive reputation. In response to these challenges, Juul has undergone significant internal restructuring. Changes in leadership and adjustments to marketing practices have been part of a broader effort to address the issues that led to the brand’s fall from grace. However, the journey towards redemption remains an uphill battle as Juul navigates a complex landscape shaped by evolving regulations, shifting public perceptions, and ongoing health concerns associated with vaping.

Presently, an estimated 35 million individuals worldwide are using electronic cigarettes or “heat-not-burn” tobacco products. Although the global market for electronic cigarettes remains modest when compared to traditional tobacco cigarettes, its expansion is notably rapid. In the previous year, global sales of tobacco cigarettes surpassed $713 billion, while electronic cigarettes accounted for $15.7 billion in sales. Projections indicate that by 2023, the sales of vaping products are anticipated to more than double, reaching $40 billion, while cigarette sales are expected to experience a slight decline.(Link 01) Governments across the globe are grappling with the challenge of addressing the vaping epidemic. The optimal resolution would prioritize enhancing public health without jeopardizing national economies, risking societal opposition or political repercussions, and becoming entangled in a wave of litigations, likely instigated by the vaping industry, tobacco companies, and other stakeholders.

The market for electronic cigarettes faces intense competition, characterized by the participation of numerous local, domestic, and international players. The rivalry among these competitors is strong, prompting players to predominantly focus on product innovation and development as key strategies. In response to the growing population of health-conscious consumers globally, major industry players are implementing various tactics to capture consumer interest, such as launching products with innovative technological features. Additionally, heightened competition is evident through increased firm concentration ratios and elevated advertising expenditures by companies. Notable leaders in the market, in order of market share are Imperial Brands PLC, JUUL Labs Inc.,British American Tobacco PLC, Philip Morris International Inc., and Japan Tobacco Inc. (Source – Mordor Intelligence)

Prominent tobacco corporations transitioning to novel nicotine products, such as Philip Morris International (PMI)and British American Tobacco, stand to encounter significant setbacks if alternative tobacco options become subject to identical regulations as traditional cigarettes, according to investors and analysts. In a recent development, the World Health Organization (WHO) urged governments to implement tobacco-style controls on vaping products, asserting that these alternatives are enticing new users into nicotine dependency. PMI, holding the title of the world’s largest tobacco company by market value, has spearheaded the shift towards smoking alternatives, resulting in a substantial increase in its price-earnings ratio, a crucial metric for evaluating company valuations, in comparison to its competitors. The WHO’s recommendations on vaping precede a biennial conference for 183 governments participating in a global tobacco control treaty, scheduled for the coming year. During this conference, countries will deliberate on emerging nicotine products, including vapes and heated tobacco. While the U.N. agency lacks authority over national nicotine regulations and solely offers guidance, the binding nature of the treaty makes it unlikely for governments involved to promptly adopt new regulations on alternatives as part of the agreement. The regulation of new nicotine products has proven challenging in various nations. In the United States, an influx of illicitly flavored vapes from Chinese manufacturers has saturated the market in recent years, taking advantage of lax enforcement after regulatory efforts to restrict e-cigarettes. Australia, where individuals need a prescription to acquire nicotine-containing e-cigarettes, has also grappled with an influx of unlawful products. Consequently, tobacco companies find themselves in competition with numerous smaller entities, often disregarding established regulations. (Link 01)