Member Article

What’s the future: E-cig brands following Brexit?

There are a number of markets that are hoping Brexit will result in the review of some EU regulations. The E-cigarette industry is one example. The recent revision to the Tobacco Products Directive (TPD) regulation, which came into force a couple of months ago, now prevents E-cigarette brands from any advertising. From the start, the marketing of e-cigarette products has been fraught with confusion and regulation change.

If an e-cigarette has zero nicotine then it’s not regulated by the TPD at all. However, if an e-cig has more than 20mg/ml of nicotine, under the new rules it will need to meet medical standards and be medicinally licenced – which means it will be treated like an over-the-counter drug. E-cigs regulated by the TPD, but that have not been licenced as a medicine, will need to carry a health warning covering 30 per cent of the packaging. So there’s now a market that’s giving even more mixed messages.

Andy Whitmore, co-founder at 438Marketing comments, “We are strongly backing a review of the EU’s revised TPD that banned all advertising of e-cigarette companies not regulated as medicinal products.

“Brexit means a number of brands and businesses operating within the e-cigarette market now have a chance for recent EU decisions to be reviewed. And we for one will be hoping that Britain’s powers-that-be will take a more realistic view of this category, particularly important given that forecasts say that by 2020 sales of e-cigarettes worldwide will overtake sales of tobacco cigarettes.

“Moreover, the evidence is out there that VIP E-cigarettes, like many of the other brands, can actually be an incredibly useful tool in encouraging smokers to give up smoking and that it is a healthier alternative to smoking. But as a brand, VIP is not allowed to advertise and to encourage what is surely a positive if we can get people switching to vaping versus smoking?

“I’m not anti-regulation by any means. Having worked in the marketing industry for more than 25 years, I know that regulations need to be in place and I’m all for sensible control and consumer protection. But all we ask in this post-Brexit landscape is that we offer consistency and evidence in order that informed choices can be made.”

438Marketing has worked with one of the fastest growing e-cigarette brands in the UK, VIP, since it entered the market in 2009, guiding its communications through the twists and turns of the ever-changing regulations within this category.

Over recent years, VIP’s marketing became one of the most talked about campaigns in the UK, as well as worldwide. VIP was the first brand to screen a television advert for e-cigarettes, causing outrage among some health campaigners who felt it ‘glamorised’ smoking, despite the advert showing a woman exhaling e-cigarette vapour.

While this attention increased brand awareness, and was great for 438Marketing, it increased scrutiny in terms of what brands could and couldn’t depict in advertising.

All this ‘control’ has done is lead to confusion among the estimated 3m consumers now vaping and, to a certain extent, the decision makers. From the start there has been no clear information presented or consistent messaging about the safety, or otherwise, of these products; and what the latest EU regulations have done is make this worse.

In addition, compliance is costly.

One e-cig company who contacted the MHRA was told they would need 900 licences to keep selling their current product range, which would cost in excess of £1.8 billion. So effectively what the EU regulations have done is given the bigger multinational tobacco brands an ability to dominate market share, to the detriment to smaller ‘unregulated’ brands that may not have the resources required to achieve MHRA Licensing, despite their products being comparable. With each licence costing in excess of £2m it’s a bit of a non-starter for smaller brands who will need multiple licences. So a top heavy category emerges and the retailer’s margin erodes and the price point rises.

For more information on 438Marketing’s services, please visit www.438marketing.com, email webenquiries@438marketing.com or call +44 (0) 1565 632 438.

This was posted in Bdaily's Members' News section by celine goodier .