Is Altria Trying to Corner the E-Cig Market?

Its latest investment in the cigarette alternative sector suggests it might have bigger plans.

Want to know how you can tell tobacco giant Altria is serious about electronic cigarettes? It’s now investing in vape shops.

The leading U.S. cigarette manufacturer — which is also hoping to reap a windfall if Philip Morris International is successful in winning FDA marketing approval for its heat-not-burn Marlboro Heatsticks e-cig — said it took a minority position in one of the country’s largest e-cig retailers because doing so will give it greater insight into customers’ purchasing habits.

Clearing the air

The electronic cigarette market has the potential to change dramatically in size and scope this year. If Philip Morris can earn a reduced-risk classification for iQOS, it may gain a competitive edge over other e-cig manufacturers that aren’t legally able to advertise their products as a safer alternative to traditional cigarettes.

If it fails on that score, but still wins approval to sell the device in the U.S., it will introduce a new technology into the market that will eventually be followed by similar products, such as British American Tobacco‘s iFuse glo, which the U.K.-based tobacco company has said it will seek approval for later this year.

Heat-not-burn technology elies wholly on real tobacco to create a vapor that delivers both the nicotine hit and the tobacco flavor smokers crave. The devices now available in the U.S. market rely upon nicotine-infused ejuices to provide the same effect, and many users feel the result comes up short of the real thing.

But the element common to all the devices is that they’re sold in drug stores, convenience stores, and vape shops, stores dedicated to the  promotion of such products.

A new direction

Avail Vapor is one of the biggest chains of vape shops, and also manufactures its own e-liquids, which Altria says are produced in state-of-the-art, ISO-certified clean rooms. The company also has a full-service analytical laboratory where it conducts tests to ensure it’s in compliance with federal regulations.

Altria already has its own electronic cigarettes on the market: the MarkTen XL from its Nu Mark subsidiary, as well as Green Smoke, one of the early players in the space that Altria acquired several years ago. These devices are often referred to as cig-a-likes because they’re shaped like combustible cigarettes, and often come with rechargeable batteries and replaceable cartridges containing the eliquids that are heated to create a vapor.

Larger vaping systems are referred to as tanks or mods, and users can customize them to to their own personal designs.

Read more at fool.com

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