Learn About The Development History Of E-cigarettes in One Article
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Learn about the development history of e-cigarettes in one article
After the explosive development of e-cigarettes in recent years, everyone is no longer unfamiliar with it, but everyone is not necessarily clear about the development history of e-cigarettes. If you want to understand the history of the development of e-cigarettes, just read this article.
As a popular new type of tobacco product, e-cigarettes are an industry that continues to develop and innovate driven by demand from overseas consumer markets. Some friends who pay attention to the e-cigarette industry across industries hope to know more about the e-cigarette industry. So, this article will sort out the development history of e-cigarettes. I also hope that readers can get some inspiration for future development from past history.
1. Before 2003: Early concepts related to e-cigarettes
In 1927, American Joseph Robinson applied for a patent for the first electric vaporizer. He claimed that the invention could be used to atomize medicines, making it easier for people to inhale the vapor without any possibility of being burned. . However, Robinson did not bring his patent to market.
Although the electric vaporizer designed by Joseph Robinson was not for atomizing tobacco, its appearance may have provided ideas for Herbert Gilbert's later design of smokeless cigarettes.
In 1963, American worker Herbert A Gilbert applied for a patent for an electronic smoking device. His smokeless cigarette design claimed to "replace paper and burning materials with heated, moist, scented air." tobacco".
Unfortunately, this invention was too advanced. Although some companies were willing to invest, there was no market demand under the circumstances at that time, and it was not commercialized in the end.
2. 2003-2009: The first commercial e-cigarette
It was not until 2001 that Chinese pharmacist Hon Lik invented the first nicotine-based e-cigarette product, which used ultrasonic technology to atomize a solution containing propylene glycol, nicotine and other ingredients.
In 2003, Han Li applied for and obtained an invention patent for "a non-combustible electronic atomized cigarette". He subsequently established a company to commercialize it under the brand name "Ruyan". Han Li is therefore widely regarded as the inventor of e-cigarettes.
In December 2006, Jinlong Group acquired the e-cigarette business from Han Li, one of its shareholders. In November 2007, Jinlong Group issued an announcement and changed its name to Ruyan Group. Its market value was once nearly HK$120 billion. In 2008, Ruyan's sales reached 1 billion yuan, with global sales exceeding 300,000 sticks.
But Ruyan was just a flash in the pan. On the one hand, starting from 2008, Ruyan suffered from public pressure in China due to publicity issues. On the other hand, its overseas development suffered setbacks. Just one year later, in 2009, Ruyan suffered a full-year loss of up to 444 million. Yuan.
In 2013, Ruyan, which had suffered losses for four consecutive years, was acquired by Imperial Tobacco for US$75 million, including e-cigarette patents. Hanli also served as a research and development consultant for Fontem Ventures, an e-cigarette company owned by Imperial Tobacco.
3. 2003-2018: Rapidly expanding e-cigarette industry
As the saying goes, when a whale falls, everything rises. Although Ruyan is a short-lived flash in the pan, the e-cigarette it commercialized has given birth to an industry with strong vitality.
1. The outbreak of overseas e-cigarette consumer market
In 2005, Ruyan Technology's e-cigarette products began to be exported overseas; in 2006, e-cigarettes began to be sold and used in Europe; in 2007, e-cigarettes quickly entered the U.S. market after becoming popular in the European market.
In September 2008, the WHO announced that it did not consider e-cigarettes to be the most effective aid to quit smoking, and the U.S. e-cigarette regulatory policy immediately began to tighten. In March 2009, the FDA regulated e-cigarettes as medical devices and banned imports. The development of the industry was hindered and the market size was slow growth.
In April 2009, Smoking Everywhere filed a lawsuit in federal court, arguing that e-cigarettes were tobacco and that the FDA had no jurisdiction over them. At the end of 2010, the federal district court and the Washington Court of Appeals ruled against the FDA, stipulating that the FDA could only regulate e-cigarettes as tobacco products. The following year, the FDA announced that it would regulate e-cigarettes under the Food, Drug, and Cosmetic Act.
After the FDA lost the lawsuit in 2010, the U.S. e-cigarette market was opened up. Shenzhen relied on the advantages of the electronics and foreign trade industry chain to quickly emerge a number of e-cigarette OEMs, which accepted a large number of orders from overseas, especially the United States. As a result, Song in Shenzhen Baoan An e-cigarette industry cluster has gradually formed in the Gang and Shajing areas.
Many established e-cigarette companies were established between 2009 and 2013, such as Maxwell, Heyuan, Zhuolineng, Yijiate, Green Yunda, Xinyikang, Kanger, Zhuoeryue, Jirui, and Clay Peng, Wulun Technology, Jasper, etc.
In 2014, China had more than 2,000 e-cigarette factories, producing 90% of the world's e-cigarettes. It has maintained this level since then, with about half of the products sold to the United States and one-third to Europe.
2. The sudden emergence of e-cigarette trends in China
From the perspective of the consumer market, 2003 to 2008 was the initial development stage, with markets both at home and abroad; 2009 to 2018 was the rapid expansion stage, with the market concentrated overseas, and there was no domestic market.
However, in 2018-2019, e-cigarettes suddenly became a hot topic in China, and a large number of e-cigarette brands rushed to be established, such as RELX, YOOZ, etc. Based on the information from all parties, there were two main reasons that promoted e-cigarettes to become a trend at that time. One was high profits, and the other was high product repurchase rate.
Especially in December 2018, a piece of news went viral on WeChat Moments, [A US e-cigarette company gave out a year-end bonus of US$2 billion, with an average of US$1.3 million per capita! 】
What company is so inhumane?
It turns out that the American e-cigarette company Juul Labs plans to spend US$2 billion to issue year-end bonuses in the form of special dividends to all 1,500 employees of the company. Based on this calculation, each person can receive an average of US$1.3 million (approximately RMB 8.95 million). Yuan).
Juul first appeared in the U.S. market in 2015, but by 2016, its sales surged 700%. By September 2018, Juul had occupied 72% of the U.S. e-cigarette market, with sales that year reaching $2 billion. .
At that time, Juul was valued at US$38 billion, once surpassing Space X. At the end of 2018, U.S. tobacco giant Altria spent $12.8 billion to acquire a 35% stake in JUUL. After raising money, Juul waved its hand and offered a wave of benefits to its employees, which led to the scene of a million-dollar year-end bonus.
Different from the European and American markets, e-cigarettes have disappeared from the domestic market since 2008 after Ruyan declined in China. By 2018, many people believed that e-cigarettes were imported and foreign products.
In 2018, the domestic e-cigarette consumer market was completely blank, and it was undoubtedly a big piece of meat in the eyes of brands. Inspired by the million-dollar year-end bonus, domestic brands are full of hope and energy.
In the first half of 2019, domestic e-cigarette brands sprung up like mushrooms after a rain, and various financings continued. According to incomplete statistics, there were more than 35 capital investment projects in e-cigarettes in the first half of 2019, and 18 financings of more than 10 million yuan occurred. The total amount More than 1 billion yuan.
However, the domestic trend did not last long. By October 30, 2019, the "Notice on Further Protecting Minors from E-cigarettes" was officially released, and the "Online Sales Ban of E-cigarettes" began to be implemented.
As a result, e-cigarettes have entered a stage of strong supervision from a stage of rapid expansion.
4. 2019 to present: The beginning and strengthening of the regulatory era
The rapid development of e-cigarettes has attracted the attention of relevant organizations in various countries and regions around the world, and has also attracted a lot of controversy. The biggest controversy is the temptation of this product to teenagers. A typical case is that JUUL has fallen into a vortex of public opinion due to attracting teenagers. , the valuation fell again and again.
Based on the consideration of protecting teenagers, countries around the world have regulated e-cigarettes.
1. Regulatory policies in major overseas consumer markets
In August 2016, the "Tobacco Products Control Act" promulgated by the US FDA took effect on August 8, 2016, requiring new tobacco products to pass PMTA before they can be marketed and sold legally. At the same time, supervision to prevent teenagers from using e-cigarettes will be strengthened. In February 2020, Monthly regulatory tightening has significantly increased industry compliance costs.
In the EU, e-cigarettes are regulated and managed as recreational consumer products. Starting from 2016, e-cigarettes and related products will be regulated by Chapter 20 (article 20) of the TPD.
2. Domestic regulatory policies
After the domestic ban on online sales of e-cigarettes was issued in October 2019, on March 11, 2022, the official website of the State Tobacco Monopoly Administration issued an announcement on the "E-cigarette Management Measures", which will be effective from May 1, 2022. Be implemented.
On April 12, 2022, the mandatory national standard for e-cigarettes (GB 41700-2022) was officially released and will be implemented on October 1, 2022.
After the promulgation of management measures and national standards, e-cigarette factories need to obtain a license before producing and register on a unified trading platform. The domestic e-cigarette industry has officially entered the era of compliance.
5. Conclusion
Finally, for e-cigarettes, the era of strong regulation does not mean the end of the industry. On the contrary, it is the beginning of a longer term, and the market continues to grow.
There is data to support that in 2023, my country's total exports of e-cigarette products (including e-cigarettes and similar personal electronic atomization equipment, and other nicotine-containing products that are not burned and smoked) will reach 77.954 billion yuan, while the total exports in 2022 will be 66.286 billion yuan.
It's just that different from the simple and crude expansion stage in the past, the e-cigarette industry in the era of strong supervision needs more technological innovation to develop products that comply with regulatory policies and market demand. Again, for the e-cigarette industry, change is the only constant. There are challenges, but at the same time, there are also opportunities.
