Another Big Tobacco player Altria Group Inc. has announced plans to release its own take on the electronic cigarette later this year. Altria is the largest tobacco distributor in the United States and is better known to consumers for its Marlboro brand. After watching sales continue to slump, Altria has decided follow in the footsteps of its traditional competition and move forward with plans to develop a new electronic cigarette.
Other tobacco companies have already began marketing electronic cigarettes, so we’re in no doubt that Altria is making the move in order to stay competitive and develop a foothold in our emerging industry. Lorillard Inc. now owns Blu Cigs, and has managed to keep sales strong by diversifying products to include tobacco free alternatives.
Given Altria’s size and financial weight, we can probably expect their offering to be a significant player in the market. Marlboro is already one of the most recognizable brands in the tobacco industry, so there is no doubt that their move into electronic cigarettes is another watershed moment for both industries.
On April 25, Altria’s chairman Marty Barrington said, “We are pleased to announce another step in our efforts to address the changing preferences of adult tobacco consumers.” Barrington went on to explain that they will release an e-cigarette through its ‘tobacco alternative’ subsidiary Nu Mark later in 2013.
Altria reported a noted decline in cigarette sales for the first quarter of 2013, with total sales falling by 5.2 percent. Marlboro brand in particular fell by 5.5 percent in the first quarter. Total revenue decreased by only 2 percent. They are pinning their hopes that the release of an electronic cigarette will bring an increase in sales later this year.
Given the success of competitors and the industry, rolling out a new electronic cigarette seems a no brainer. With the industry appearing to be blooming further in 2013, right across the world, the stakes seem to be rising by the day. We’re sure e-cig users and smokers alike will be interested to see what hand Altria’s, and indeed big tobacco, continues to play with their moves into our industry.