Juul’s dominance of the electronic cigarette sector has grown to the point that its nearest rival no longer has a double-digit market share.
Wells Fargo Securities analyst Bonnie Herzog issued her latest report Wednesday, based primarily on Nielsen data.
Juul’s market share increased from 70.5 percent to 72.1 percent during the four-week period that ended Aug. 11. Meanwhile, Vuse’s market share dropped from 10.8 percent to 9.6 percent even as it lowered some product pricing to drive sales.
Juul, made by Juul Labs Inc. of San Francisco, entered the mainstream retail marketplace in 2015, and is sold in the form of a pen or a USB device. That design makes it easy to hide its usage.
A year ago, Juul was at 55.7 percent, Vuse at 17.5 percent, MarkTen XL of NuMark was third at 9.9 percent, blu eCigs of Fontem Ventures was fourth at 8.4 percent and Logic of Japan Tobacco was fifth at 4.7 percent.
By comparison, for the most recent period, MarkTen is at 7.5 percent, blu eCigs at 5.4 percent and Logic at 3 percent.
The Juul growth comes despite increased scrutiny from the Food and Drug Administration and criticism from anti-tobacco advocates about anecdotal reports on youths using the product, including while they’re in school.
On April 22, the FDA expanded and tightened its oversight over Juul products, including taking steps to halt online sales to youths on eBay. Although the four steps announced by FDA Commissioner Scott Gottlieb in a new youth tobacco-prevention plan apply to other e-cigs, the focus clearly was on Juul.
Two days later, Juul Labs agreed to take significant steps to address federal and state regulatory concerns, including “actively supporting” initiatives to raise the minimum age to at least 21 to purchase tobacco products.
In August, Juul began requiring purchasers of Juul on its website to be at least 21.
Juul also pledged an initial investment of $30 million over three years dedicated to independent research, youth and parent education, and community engagement efforts.
On July 17, Reynolds said it is preparing a nationwide launch in August of its version of a “pod mod” similar to the Juul vaping delivery mechanism.
The goal is to have Vuse Alto in national distribution by November. Sneak peeks of Vuse Alto show it being offered at retail in a mixed pack containing one flavoring pod each of original, rich tobacco, menthol and mixed berry.
On the traditional cigarette side, top-selling Marlboro’s volume fell 1.6 percent during the latest period, its leading market share inched up 0.1 percentage point to 47.3 percent.
Meanwhile, No. 2 Newport of Reynolds had a 2.2 percent sales decrease. Its market share increased 0.1 percentage point to 12.8 percent. Herzog said the brief decline continues to be caused by consumer disappointment with the launch of Newport Platinum.
“For 2018, we continue to expect cigarette industry volume to decline towards the high end of the historic range of minus 3 percent to minus 4 percent.
Natural American Spirit’s market share was unchanged 3.4 percent. Camel was unchanged at an 8.8 percent market share, and Pall Mall was unchanged at 6.6 percent.
ITG Brands’ Winston brand was unchanged at 2.2 percent, while Kool was at 1.6 percent.
ITG Brands’ market share was unchanged at 7.3 percent.